Study Predicts Increased Investment for Online Grocery

A recent SupermarketNews article reported the “digital sector” will continue to grow in 2023.

“Grocery operators’ spending to support digital transactions will increase by 2.3% next year despite a 1% shrinkage in technology budgets,” the article said, citing an October report from Grocery Doppio, a grocery insights and data provider. ,

Other findings:

  • 23% of grocers plan to increase their technology spend on digital in 2023
  • 77% said fulfillment efficiencies will be among the three most popular investments
  • 67% identified digital basket size nurturing would be a focus
  • 55% said system-wide inventory data accuracy/transparency would be a priority

Read the full article…

SCO or MCO?

A recent SupermarketNews article reported that the number of Self Checkout lanes (SCOs) in the U.S. has increased 10% in the last five years, estimating that they now account for nearly 40% of lanes in grocery chains in the U.S. 

Sharing data from shopper intelligence leader Catalina, the article also reported that more retailers are make shifts from manual to SCO lanes to offset “shrinking margins from inflation, respond to social distancing protocols triggered by the pandemic, and take advantage of automation technology.”

Based on a small local poll, we’ve concluded that shoppers most often prefer the self checkout option when:

  • Processing smaller orders
  • Processing orders without coupons
  • Processing orders without alcohol

Some additional insights presented in the article based on the Catalina data included 39% of shoppers used both lane types in 2021, depending upon their shopping mission. 49% of shoppers preferred the personal attention offered in the manned-only lanes (MCO), while only 12% of shoppers were steadfast SCO-exclusive fans. Breaking down the behavior of the hybrid shopper, their transactions were split 50-50 between MCO and SCO, with MCO accounting for 68% of sales and SCO for 32%.

Similar to our local findings, the study said SCO-only shoppers had smaller baskets and bought less than hybrid and MCO fans.

Generally speaking, it strikes us that offering a healthy mix of MCO & SCO options enables shoppers to leverage the technology to enjoy greater flexibility and convenience.

What’s your take?

Accelerating the Customer Experience?

SupermarketNews recently reported that Schnuck Markets will be providing 30-minute delivery with its “Schnucks Now” offering on smaller orders and fast delivery. 

“The new service allows customers to shop from a limited assortment of fresh groceries, pantry, household essentials, alcohol, meals, and snacks, with delivery in as fast as 30 minutes with no priority fees and lower delivery fees,” the article said.  

In today’s competitive marketplace, this seems like another step forward in providing an enhanced customer experience. As you may know, Schnuck’s has offered delivery and pick up options for some time, and has also partnered with DoorDash to provide prepared meal delivery.

The piece went on to quote Chace MacMullan, Schnuck’s Senior Director Digital Experience, who said, “‘It’s been something we’ve been talking about for a while. We partner with Instacart and together we’re always looking at different ways to innovate. Reach the customers where they are, and where they are in the delivery schedule.”

Bigger And Better?

A recent SupermarketNews article reported Kroger and Albertsons plan to merge in a deal valued at $24.6 billion.

According to the piece, the merger will combine two of the country’s largest supermarket retailers, “creating a national company with 4,996 stores, 66 distribution centers, 52 manufacturing plants, 2,015 fuel centers and more than 710,000 associates across 48 states and the District of Columbia.”

 The merged entity also would be the fifth-largest retail pharmacy operator, with 3,972 pharmacy locations.

Given the histories of these two organizations, we’d expect the merger will result in a “bigger and better” solution!

Process Improvement at Walmart for Next-Gen Fulfillment Centers

A recent SupermarketNews article reported the grand opening of Walmart’s 1.1M square-foot Next Generation fulfillment center, which will enable faster processing and delivery of on-line orders to wider geographic areas. The new concept facility will also bring about new jobs.

The piece quoted James Bright III, general manager, Fulfillment Center FC3040, who said, “As the first-of-its-kind for Walmart, our newly opened facility introduces an array of opportunities to our associates, including brand new tech-focused jobs. There’s never been a more exciting time to join Walmart Supply Chain.”

Process Improvement
The new center will be the first of four next-gen FCs that will feature a new patent-pending process that is “powered by the combination of people, robotics and machine learning,” the article said. “This process will set a new precedent in fulfillment speed by streamlining a manual twelve-step process to just five steps. Once completed, the four new state-of-the-art FCs for Walmart could provide 75 percent of the U.S. population with next- or two-day shipping.”

Read the full article…

Inventory Issues Costing Supermarkets Dearly

SupermarketNews recently reported that, despite internal systems improvements, retailers continue to struggle with labor and supplier issues, costing North American supermarkets over $349 billion in total sales lossesmdue to out-of-stocks and overstocks.

Reports of consumer discontent are common, with shoppers claiming one-out-of-five items they want to buy are out-of-stock according to new research from analyst firm IHL Group the article said.

“While there have been considerable improvements in systems and processes in recent years, labor challenges and continued supply chain disruptions issues continue to frustrate both consumers and retailers,” said Greg Buzek, President of IHL Group. “In addition, challenges from theft, mistakes by employees, and spoilage cause retailer’s inventory counts to be off as much as 25%, resulting in consumers having a shopping experience where they left the stores without buying 1 in every 5 items they planned to buy.”

Ouch!

You can read the full article here.

Kroger Growing Grocery Sales With Spokes

A recent SupermarketNews article reported that Kroger is continuing to grow e-commerce through expansion and by leveraging technology.

The article said two more automated “spoke” supporting facilities have been opened as “The Kroger Co. continues to build out its e-commerce network driven by Ocado Group technology, a Canada based firm.

As you may know, the spokes serve as a last-mile cross-dock sites for online grocery delivery and help extend the reach of delivery service. The hub and spoke model refers to a distribution method in which a centralized “hub” exists. Everything either originates in the hub or is sent to the hub for distribution to consumers. From the hub, goods travel outward to smaller locations owned by the company, called spokes, for further processing and distribution.

“The continued expansion of the Kroger fulfillment network means improved access to fresh food for customers eager for the variety and value offered by Kroger that once could only be accessed through our stores,” Gabriel Arreaga, senior vice president and chief supply chain officer at Kroger, said in a statement. “This network enables Kroger to add scale, achieve reliability of experience, gain from the benefits of automation and ultimately widen our customer reach in current operating regions and new parts of the U.S.”

PBH to Connect Produce Industry With Retail Dietitians, Foodservice Leaders

According to a recent Progressive Grocer article, the  Produce for Better Health Foundation (PBH) will bring a number of retail dietitians and foodservice leaders to its 2022 Retail & Foodservice Immersion Event in October.

Adding a new twist to past practices, PBH will “include a group of foodservice leaders to further support the produce industry’s need to meet consumers where they are influenced to choose fruits and vegetables at the point of purchase.”

Retail and foodservice leaders will also have access to the latest produce innovations and new consumer research, along with tools to spur new fruit and vegetable consumption habits among customers.

“PBH is thrilled to be back in person supporting one of the industry’s largest trade shows, as well as connecting produce companies directly with consumers through the various points of influence – including at the point-of-sale (retail) and at the point-of-flavor (culinary and foodservice),” noted Wendy Reinhardt Kapsak, president and CEO of Brentwood, Mo.-based PBH, a nonprofit 501(c)(3) organization. “The goal of this signature PBH event is to provide retail and foodservice leaders with actionable education and intimate networking experiences that inspire them to get creative with fruits and vegetables and take back ideas and solutions that help drive produce consumption and purchases in their stores, in e-commerce and in dining establishments nationwide.”

Participating retailers are:

  • Big Y Foods
  • Coborn’s, Fresh Thyme
  • The Giant Co.,
  • Harmons Grocery Stores
  • H-E-B
  • The Kroger Co.
  • Loblaws
  • Natural Grocers
  • Rouses, ShopRite-Inserra Supermarkets Inc.
  • Stop & Shop
  • United Supermarket
  • Wegmans Food Markets
  • Weis Markets

Read the full article…

USDA Supporting SNAP Online Grocery Shopping

A recent SupermarketNews article reported that the U.S. Department of Agriculture (USDA) is launching a $5 million competitive grant program to help expand the number of retailers that offer recipients of Supplemental Nutrition Assistance Program (SNAP) benefits online grocery shopping.

Retailers will need to apply to participate in the program, which will provide support with the “technology and systems necessary to enable SNAP e-commerce,” the article said.

The piece went on to explain the objective is to give SNAP participants access a larger diversity of retailers while shopping for groceries online, according to a source at the USDA. The grant is funded by the American Rescue Plan stimulus legislation, enacted last year.

The article then quoted Stacy Dean, deputy undersecretary for food, nutrition and consumer services at USDA, who released a statement saying, “Online grocery shopping is a vital resource that improves access and convenience for all, including low-income families. We are excited about this grant’s potential to provide new and existing retailers with tools to redeem SNAP benefits in ways that improve customer service for SNAP participants, especially those that face barriers in traveling to a physical store.”

Read the full article…

2022 Top 50

SupermarketNews (SN) recently announced their list of top retailers, which is compiled by SN and TIGD, a leading UK-based analysis and insight organization for the food and consumer goods industry.

You can review their findings in an online gallery, which “showcases the rankings based on sales of the Top 50 food and grocery retailers and wholesalers in the U.S. and Canada, including supermarkets, mass merchandisers, dollar stores, convenience stores and drugstores.”

In the announcement, SN noted that sales figures were based on reports from public retail companies and, in cases of privately owned companies, IGD estimates.

You can access the SN Top 50 Retailers gallery here.