High street retailer Superdrug is overhauling its entire electronic point of sale (EPOS) network to meet the January 2005 chip-and-pin fraud compliance deadline.

The health and beauty chain plans to replace tills across its 700 UK stores by August 2004 using new hardware from retail systems integrator Wincor Nixdorf.

The new EPOS hardware will help cut down on rising maintenance costs resulting from ageing IT systems installed 10 years ago.

"The new chip-and-pin technology is expected to dramatically reduce card fraud, which cost UK banks and retailers more than £400m in 2003," said a Superdrug spokeswoman.

Using Mosaic's Europay Mastercard Visa compliance technology, linked to intuitive cashier software from Retalix, Superdrug's new tills will be able to cut down on credit card fraud.

"Transaction times are also expected to be reduced significantly, improving customer service," said the spokeswoman.

The new EPOS systems replace keyboards with touch screens, significantly cutting training costs by walking cashiers through the sales process step by step.

Retalix software also includes an on-screen, pull down product recognition system to identify items if scanners cannot read an individual barcode.

The embedded Windows XP operating system, adopted across Superdrug's parent company A.S. Watson, also links EPOS information to data warehousing and supply chain systems, and includes real-time monitoring to cut down on shrinkage.

The tills are installed with e-top up software from PayPoint so that the retailer can offer pre-pay mobile phone services, and Superdrug will be able to improve promotional activity by recognising two-for-one offers and coupons.

Wincor Nixdorf will roll out the new systems to 30 stores each week until completion of the project in autumn 2004.