Grocery Outlet Taps Into Cloud Analytics for Refrigeration Management

Extreme-value grocer teams with Axiom Cloud on tech for California stores
Marian Zboraj
Digital Editor
Marian Zboraj
Grocery Outlet
Axiom's apps will be used by Grocery Outlet to enhance refrigeration uptime, reduce refrigerant leak rates, and generate new revenue through automated demand response.

Grocery Outlet has moved from a pilot to a major regional rollout by deploying Axiom Cloud’s "apps for refrigeration" to 79 stores throughout California. Axiom's apps will be used to enhance refrigeration uptime, reduce refrigerant leak rates, and generate new revenue through automated demand response. In the first three months of operation, the apps have already helped Grocery Outlet stores save $418,000 on energy bills and maintenance costs.

"Grocery Outlet has been interested in using cloud analytics for things like predictive maintenance, energy commissioning and demand response for a few years now, but we hadn't found the right technology partner," said Frank Davis, senior director of refrigeration and sustainability at Grocery Outlet. "We are looking to install Axiom apps in more stores throughout the United States if results continue to be so positive."

[Read more: “Grocery Outlet Names New CEO”]

Axiom Cloud's mission is to use software and automation to transform how the world's cooling systems are powered, operated and maintained, to generate significant climate and financial impact. With its Facilities Analyzer, Axiom's foundational app, Grocery Outlet now has real-time access to refrigeration data across all enrolled sites in one dashboard. Grocery Outlet independent operators will also receive highly contextual notifications alerting them to urgent maintenance issues, refrigerant leaks and energy-saving opportunities.

Meanwhile, Axiom's Virtual Battery app provides the extreme-value grocery retailer with a completely new revenue stream by using low-temperature refrigeration and HVAC loads to participate in utility demand response programs. Virtual Battery also allows Grocery Outlet to take advantage of lucrative Automated Demand Response incentives, which help reduce costs and make the ROI even more attractive.

"We're thrilled to announce that Grocery Outlet has progressed from a pilot to a major regional rollout," said Amrit Robbins, CEO of Oakland, Calif.-based Axiom Cloud. "Their franchise model means that energy and maintenance costs at individual stores are always subject to additional scrutiny, and we're looking forward to helping independent operators increase their margins and better serve their communities."

Grocery Outlet recently reported results for its third quarter ended Oct. 1. Net sales increased by 19.4% to $918.2 million as inflation weary shoppers flocked to the off-price grocery retailer. Same-store sales increased by 15.4% and on a three-year stacked basis rose by 20.2%.

Net income increased by 2.1% to $17.5 million, or 17 cents per diluted share. Adjusted EBITDA increased by 15.0% to $59.1 million. Adjusted net income rose 14.2% to $26.8 million, or 27 cents per adjusted diluted share.

The company opened six new stores, ending the quarter with 431 stores in eight states.

Emeryville, Calif.-based Grocery Outlet offers products sold through a network of independently operated stores at more than 400 locations in California, Washington, Oregon, Pennsylvania, Idaho, Nevada, New Jersey and Maryland. The company is No. 70 on The PG 100, Progressive Grocer’s 2022 list of the top food and consumables retailers in North America.

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