Labor productivity has never been more important in grocery retail.
And this is predominantly driven by two key factors.
One, the labor pool is shrinking. In 2023, 68%1 of grocers described ‘labor availability’ as ‘difficult’ or ‘very difficult’. Two, whilst retailers face a reduced workforce, the labor that is available is stretched as their task list increases.
Whether it's reducing stockouts, correcting inventory records, or carrying out online picks, retailers need to do more with less, and set against a backdrop of decreasing margins, the answer isn’t as simple as hiring more staff.
The reality is that retailers need to find solutions to free up existing staff to serve and sell. How? By ensuring that their workforce have the tools that are quick to learn, quick to scale and help with prioritization.
But where do you start? Do you focus on gap scans? What about inventory replenishment, online picks, or range and displays? Inevitably, it becomes an endless balancing act between competing priorities.
Thankfully, technology can help. In this blog, we share five tips that retailers should consider, to ensure shop floor productivity remains high despite the challenging grocery climate. From AI in stores to scalable data models, there’s a lot to unpack.
When retailers invest in improving productivity, associate training often comes out on top, and for good reason. When faced with high levels of labor attrition, grocers need technology that store associates can pick up from day one, without the need for extensive training or prior knowledge of the business.
New solutions need to be quick to deploy, intuitive, and should integrate into existing technology and processes. In doing so, training will be minimal and can be done on the job, but the ease of use also enables improved process compliance and productivity.
In real world terms this can involve integrating alerts, allowing for inventory record corrections or processing dynamic markdowns all from your existing handheld terminal software (HHT).
Grocers no longer have the luxury of adopting technology solutions that can’t scale.
Firstly, margins are too thin for multiple CapEx investments. Secondly, the limited scope of these solutions prevents retailers form understanding the full picture of estate-wide performance.
In order to assess a technologies scalability, you must understand a few key factors as part of that decision:
Whilst there are more variables (the list above should get you started), the right scalable technology will ensure that you break down silos, reduce the time burden on your IT teams, and put time-saving solutions into the hands of more staff, more quickly.
As a rough guide, cognitive technology, for example, is quick to roll out and scale across departments. By contrast, high CapEx solutions like cameras and robotics are less scalable, and require a higher investment.
Being busy doesn’t always equate to being productive, and a key driver of productivity is simply knowing the most valuable way to spend time. But in the fast-paced, unpredictable environment of the store box, prioritization is easier said than done. As already highlighted, there are a myriad of competing factors for retailers and store associates to consider.
Any solution that supports with task prioritization, and labor productivity, does two things really well, they understand the most profitable tasks and them communicate them to associates. As already mentioned in tip one, communication can, and should, be in the form of an alert that is served to your existing HHTs.
The true power comes from understanding what the most valuable task is. This is driven by your store data and any technology you look to procure needs to excel at this. In doing so, not only will you be able signal high-profit activities, but provide insight into which tasks should be actioned first. This approach instantly minimizes unnecessary confusion, empowering your teams to spend their time on what matters most, freeing them up to serve and sell.
If we're talking about prioritization we also need to discuss automation. In an environment where every minute matters, if you can not only direct staff to tasks that need attention but then allow associates to resolve the issue automatically, you stand to make significant gains.
Not only will you increase process compliance, but you will also reduce the time needed by your associates, freeing up their time and improving your store performance.
Technology can target numerous processes such as generating markdowns for expiring items, automatic replenishment of products that are out of stock or even updating your inventory record.
The latter is particular pertinent given the focus on margin that many retailers face. By automatically detecting and correcting inventory inaccuracies, technology eliminates the need for associates to reconcile and update stock records manually.
This can fundamentally improve record accuracy, while reducing the burden on your in-store team, a win-win for all involved.
Data is king when it comes to making informed decisions about your business. This becomes increasingly difficult if your stores act and exist in isolation, with their data existing in silos.
The technology you implement across your estate needs to enable scalable retail data analytics. Imagine having visibility of analytics across your estate with the ability to scrutinize metrics by store, day, or by the hour. Scalable data means you can assess everything from purchasing patterns per store to inventory levels in different regions, from availability issues and waste patterns to compliance.
Such large retail data sets are powerful tools. As well as quickly building a picture of local priorities, they can illuminate root causes, best practices and insights to make the most of every associate’s time. While at a senior level, executives get the visibility to make more informed decisions, improving revenue, the customer experience, and ultimately changing the course of business.
Ultimately, there are multiple ways that grocery retailers can improve productivity through technology, and we can see this represented in the market with the influx of solutions. Whether it’s camera technology to detect stockouts, electronic shelf-edge labels that can update prices remotely, or AI based data solutions that can prioritize labor, retailers aren’t short of choice.
Whichever route you go down, we recommend you build in the following to your decision-making process:
At Retail Insight, we can help improve your labor productivity with scalable cognitive technology solutions that can easily integrate into your existing tech stack.
Providing data-driven insights and increased visibility, you can uncover what’s really going on across your stores - resulting in prioritized, value-driven decisions. You’ll have greater confidence that your colleagues know exactly what needs to be actioned and when, with more time freed-up to serve and sell to customers.
Find out more about how we can help drive productivity across your stores.
1https://www.supermarketnews.com/technology/here-s-what-grocery-workforce-wants