RIS: What new POS enhancements and features must grocers consider as they look to streamline the checkout experience for time-strapped shoppers?
Barnes: Self-checkout is a must. However, the challenge with self-checkout is lost prevention as a result of missed checkout, theft, lack of scanning, etc. ranging between 1% and 4% of basket size. Grocery retailers should arm customers with smart shopping carts or shelf scanners. For example, the carts contain several temperature-controlled bags that not only scans as the customer places the item in the reusable bags, but also significantly improves efficiencies and convenience to the customer and by eliminating the need to remove and re-bag items at checkout. This creates ease of at-home put-away, significantly decreases the number of times an item is touched, and reduces unscanned items/lost sales.
RIS: What are the biggest hurdles grocers face optimizing their supply chains for the omnichannel age?
Barnes: Shoppers want convenience in terms of time savings. Hence, grocers must focus their omnichannel efforts on time compression: faster and more user-friendly deliveries and pick-up experiences. The challenge with an e-commerce grocery order is the number of items (30-35 unique items) across multiple temperatures (ambient, chilled and frozen). This is unlike any other e-commerce order profile. Today’s grocers are competing against one another when it comes to time and conveniences, as well as fresh and relevant product at a valued price.
Picking groceries for e-commerce orders from the store is not effective, nor efficient in the long-term. This is why many grocery chains are creating dark stores or micro-fulfillment centers and leveraging Goods-to-Person material handling equipment. The strategic future for omnichannel grocery fulfillment is leveraging independent micro-fulfillment center sites that can deliver orders to the customer within one hour. The working capital to start a micro-fulfillment center is 10 times less expensive than building a full-service grocery store. Plus, it allows grocers to create brand awareness and loyalty within new markets.
The biggest challenge is inventory positioning within the supply chain. Grocers will leverage artificial intelligence and machine learning to predict omnichannel customer order patterns that help the grocer proactively plan for and fulfill demand, allowing for more precise and demand-driven inventory placement.