Korea’s Rail Operator Accelerates Sales with Cashless Payments on its Trains

OverviewCountry or Region: KoreaIndustry: Food and Beverage Retailing Industry and Transportation and Logistics Industry

Customer ProfileAs the rail operator in Korea, Korail is responsible for the journeys of more than 100,000 passengers per day. Korail operates local and national services, including the high speed KTX service.

Business SituationKorail Tour Service sought to increase efficiency, sales and business insight in railroad management by embracing technology though cashless payment options for passengers.

SolutionImplement a point-of-sale (POS) solution with more than 350 POS devices built on Windows Embedded platforms that connect remotely to financial and business systems and aid transactions from carts and cafes on the KTX.

Benefits Access to business data in real time

drives performance initiatives, increasing sales by 10%

Containment of servicing and maintenance costs through remote management and automatic updates

Secure payment capabilities

"We expect to see an increase in sales due to credit card usage, and because we now have the ability to analyze and respond to sales patterns in the data from the trains.”

Woo-Sung Park, Team Leader, Korail Tour Service

As Korea’s rail operator, Korail has a responsibility to ensure passengers reach their destinations on time and in the greatest comfort possible. The company has worked hard to achieve rapid journeys for its customers, leading to the landmark launch of the KTX high speed trains in 2004. However with cashless payments on the increase in Korea, Korail wanted to embrace this technology on its trains and give passengers further payment options besides cash. The operator decided to rollout devices for card payments running Windows Embedded for Point of Service as the operating system to support this initiative. This decision has resulted in a ten percent increase in sales, improved efficiency in sales management, and access to business data in real-time to drive future performance initiatives.

SituationEstablished in 1899, Korea Railroad Company (Korail) has made significant advancements in reducing journey times across South Korea, with a vision of opening up the ‘Iron-Silk Road’, linking North East Asia to Europe. In April 2004, Korail launched the KTX high speed trains which, as a result of their innovative design, reduced the journey time from Seoul to Busan by 35 percent. Korail has a strategic focus on improving customer service. As well as operating a world class train service and reducing journey times, the company wanted to improve the on-board service for its passengers and be able to gather data to understand purchase patterns and make accurate stock decisions.

Korail Tour Service, a subsidiary company of Korail, is in charge of Korail’s customer services such as ticketing and on board services for KTX and Saemaul-ho trains. Korail Tour Service operated a brisk business through its ‘train cafe’ and on-board carts, supplying snacks and drinks to passengers during their journeys. However the rail operator was unable to handle electronic payments. This situation meant that employees had to manage cash payments, which were not able to be tracked or accurately recorded.

Korail Tour Service decided to rollout portable point of sales (POS) devices in its trains to give passengers greater payment options and encourage sales, to simplify processes for employees, and to provide sales data for business insights into both customer preferences and stock required.

SolutionKorail Tour Services wanted a small, affordable, smart card reader for its refreshments service, and selected UMPOS

UP-3000 hardware units running Windows Embedded for Point of Service operating system for its onboard KTX train service, developed by DLX and sold by Sisnet in Korea. UMPOS is an innovative POS device, which combines desktop POS device technology with handheld device portability for retailers. Running Intel Atom Processors, DLX selected Windows Embedded Point of Service due to the operating system’ smaller hard disk drive (HDD) capacity to aid quick installation, and the highly stable environment offered by of Windows in an operating system tailored for handheld POS devices.

The solution went live in September 2008 in an onboard cafe, on a train headed for Janghang. Korail Tour Service now has over 350 POS devices running Windows Embedded for Point of Service, which are being used by its employees in the train cafes and for cart sales on the KTX. Korail Tour Service is using these portable devices to handle transactions and to send and receive critical business data in real time.

With support being a primary concern for Korail Tour Service, the operating system provides plug-and-play functionality that enables retail peripherals to be quickly and easily installed, used and managed. Due to a standard platform and familiar management technologies, Korail can easily scale to meet future needs, as well as contain servicing and maintenance costs through remote management, and by receiving automatic updates from Microsoft using Windows Update, which simplifies management of the device and provides easy and cost-effective support.

Woo-Sung Park, Team Leader, Korail Tour Service, comments: “Getting support in real-time was important to us, as well as scalability of the end solution. We knew that support would be available for the

widely used Windows products, and we could easily expand the business. We also liked the application suite installed on the Windows Embedded POSReady solution.”

Employees can now provide passengers with an alternative payment method, and the portable device quickly generates receipts because of the ability of Windows Embedded to support peripherals. DLX has made full use of this ability, by adding USB 2.0 and RS-232 serial ports to its devices, which support printers, smart card readers, and sign and PIN pad and barcode scanners, among other features, within its UMPOS UP-3000 units.

BenefitsThe device and Windows Embedded Point of Service operating system helps Korail Tour Service to improve how it sells and operates passenger services through having better access to customer and product information. Additionally, the Windows Embedded POSReady family simplifies development and deployment of future devices, and reduces maintenance and upgrade costs, by supporting plug-and-play peripheral functionality. Since rolling out its new cashless payment solution, Korail Tour Service has experienced numerous benefits and passengers on the rail network have enjoyed greater ease when purchasing refreshments.

Reduced costs The standardized platform lowers development costs because it requires minimal customization, and additional point of service applications can be easily installed after the platform is deployed, making it easy and affordable for Korail to scale. With the portable devices able to send and receive critical business data in real time, using a stable operating system, Korail Tour Service can make accurate decisions on stock levels, cater to customer

preferences, as well as decide on service cart frequencies and café hours based on data received from the devices.

Improved customer service Korail Tour Service has improved the service it provides to passengers, by giving them greater payment options when purchasing snacks and beverages on-board trains. As a direct result of this improvement in service, sales have already increased by ten percent since the solution was rolled out, due to increased convenience and portability of the devices.

Increased sales Windows Embedded has helped Korail Tour Service achieve greater efficiency through improvements in its sales management processes. By analyzing sales patterns in the data from the devices according to time and location on the train, the company can ensure it has the appropriate items available in the cafes and carts to maximize sales. This is helping Korail Tour Service to increase sales while also driving passenger satisfaction as the required items are more likely to be available. Park explains: “We expect to see an increase in sales due to credit card usage, but also because we now have the ability to analyze and respond to sales patterns in the data from the trains.”

Greater efficiency Efficiencies have been recognized as cash now comprises a lower percentage of total payments. By increasing cashless payments, employees worry less about having the correct change for passengers or making mistakes when handling cash. Meanwhile the accuracy of the accounts from refreshment sales has improved.

Rapid support Korail Tour Service operates its cashless payment solution with the knowledge that remote support is easily accessible. Furthermore, Korail Tour Service is fully

supported when expanding the solution into new areas.

Following the successful rollout of Windows Embedded on its cashless payment devices, Korail Tour Service is now looking to expand the service to include T-money payments – Korea’s cashless payment system for transportation fares, online stores, and low value sales – giving passengers an additional payment option which will further increase sales. The company also hopes to add support for payments with Railroad mileage cards, giving even more payment options to passengers.

Windows EmbeddedWindows Embedded extends the power of Windows and the cloud to intelligent systems. Encompassing operating systems, tools, and systems and services, Windows Embedded enables enterprises to generate tangible, real-time benefits with anytime, anywhere access to executable data. Microsoft entered the embedded marketplace over 15 years ago and continues to lead the evolution toward intelligent systems with an extensive suite of technologies for enterprises across a variety of industries.

For more information visit:www.windowsembedded.com

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For more information about DLX products and services, call +82 2 585 1931 or visit the Web site at: www.dlx.co.kr

For more information about Korail Tour Service products and services, call +82 1544 7788+7 or visit the Web site at: www.korail.com

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Document published July 2009

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