On the floor of the National Retail Federation’s (NRF) annual Big Show, last month at New York City’s Javits Center, technology company after technology company promised to solve the age-old problem of out-of-stocks.
Retailers know as well as anyone, however, that one solution can’t wipe out the average 8% of unavailable items in grocery that has remained consistent year after year. There’s a rigid dichotomy between the promise of technology and execution.
- Technology can help grocers with real-time data, seeing what’s currently in stock, forecasting demand, generating orders and ultimately improving the shopper experience.
- Exhibitors provide new robot models to overcome such challenges as narrow aisles, deep shelves, refrigerator and freezer doors, and fresh displays.
- Time-saving computer-generated ordering is enabling grocers to keep pace with rival online entities.
With the expansion of online grocery, the importance of inventory management skyrockets. Jeff Kennedy, president and CEO of Des Moines, Iowa-based Itasca Retail, shares the story of a woman who placed an online order for laundry detergent from her local supermarket and instead received cat litter. This unacceptable substitution greatly alters the shopper’s experience with grocery ecommerce and the brick-and-mortar store.
Technology can help grocers with real-time data, seeing what’s currently in stock, forecasting demand, generating orders and ultimately improving the shopper experience.
Robots in All Forms
Robots are no doubt some of the most buzzworthy advancements in technology, although narrow aisles, deep shelves, refrigerator and freezer doors, fresh displays, and more can all be potential challenges for these automated systems.
Companies such as San Francisco-based Bossa Nova Robotics, however, have started to improve their robots’ capabilities. Bossa Nova 2020 exhibits a slimmer profile than the previous version, has 16 cameras and offers what the company calls “complete store coverage,” from fresh to freezer, and everything in between.
At NRF, Bossa Nova — fresh off a deal with Bentonville, Ark.-based Walmart to enter 650 more of its stores, for 1,000 total locations — demonstrates its real-time scanning capabilities and integration of the data into its dashboard. Atlanta-based NCR is handling all of the deployment.
According to Rowland, the top three pain points that Badger Technologies first aimed to solve were out-of-stocks, planogram intelligence and pricing. Now, some clients, including Ahold Delhaize USA, have requested additional functions such as making sure that stores are clean by alerting associates to spills.
For Wegmans, it all started with bagged salads, Wirl explains. The grocer was seeing more out-of-stocks and lack of freshness in the category, so it seemed right to implement a new system.
Instead of sending the manufacturer a forecast and having it figure out how much lettuce to send back, Wegmans worked with its growers and shippers and submitted individual, computer-generated orders for each store.
“The lettuce comes to the dock at the distribution center and then it goes from the supplier truck to the store truck,” Wirl notes, adding that it no longer sits in the warehouse. “The result of this was five days of extra time on the shelves. Instead of grabbing a bag of salad that says you’ve got three days at home, all of a sudden, you have eight days at home.”
Wade speaks of reallocating human capital to other areas of the store and higher-value activities that improve the overall shopping experience.
Itasca Retail taps into a similar sentiment — what it calls “the human side of CGO.” With highly refined CGO, employees can greatly cut down on the amount of time they spend counting items and stocking shelves and displays throughout the day.
Empowering employees and increasing the bottom line are really what inventory optimization boils down to, but don’t forget the most important part: improving the customer experience.
Technology executed in the right places and at the right times is the answer to making sure that when a customer orders laundry detergent online, it really is laundry detergent that’s delivered to her door.