Where robots fit into the online grocery store ops equation

Supermarket retailers are faced with a huge labor challenge. The explosion of ecommerce is amplifying this by creating the need for more order pickers, whether store employees or third-party providers, to manually fulfill e-grocery orders from stores.

Grocers are taking several approaches to address the issue. The initial goal is to improve manual order picking speed and accuracy. What worked when ecommerce order volumes were low no longer handles the larger volume of ecommerce orders being fulfilled today.

To get more orders out of the same headcount, retailers use a combination of technology, process improvements and sometimes shelves in the back of the store with fast-moving inventory that’s dedicated to filling online orders. Each of these steps can help retailers move toward achieving pick rate targets of 65 to 75 items per hour.

But pick rate improvements only solve part of the problem. There remains the issue of overcoming shopper dissatisfaction with substitutions and out of stocks. Compounding this is the challenge of picking orders from a dynamic inventory of live store shelves that makes it difficult to know what’s in stock.

As e-grocery volumes continue to increase, some retailers have started adding automated systems to further reduce labor and improve order accuracy. Current systems on the market can provide a variety of functions, including storing items, picking orders, handling store-picked orders and dispensing orders across ambient, refrigerated and frozen products.

Continue to read full article on Retail Wire.

Is Inflation Causing Consumers to Choose Pickup Over Delivery?

Brick Meets Click finds pickup rose 9% in May from last year, while delivery increased 5%

Online ordering continues to post strong numbers—e-grocery sales in May reached $7.1 billion, 1.7% higher than a year ago, according to Brick Meets Click and Mercatus—but as inflation persists, consumers who enjoy the convenience of pickup and delivery “are also becoming more cost conscious.”

Pickup, which captured 45% of online grocery sales in May, rose 9% from last year, while delivery, with a dollar share of 36%, increased 5%, according to a Brick Meets Click/Mercatus Grocery Shopping Survey fielded May 28-29. (Ship-to-home, orders received via common or contract carriers such as FedEx and UPS, represented 19% of e-grocery sales in May and dropped 16% vs. the prior year.)

Pickup’s increase was driven by a more than 10% growth in its monthly active user (MAU) base, while delivery saw modest gains in MAUs, the companies said in a release. It’s also an indication that inflation is influencing where and how customers shop online.

“Customers appreciate the convenience of ordering online, but they are also becoming more cost conscious,” said Sylvain Perrier, president and CEO of Toronto, Canada-based Mercatus. “To defend the base business, Grocers can promote pickup to address both issues. Assuming the pickup experience aligns with customer expectations, showcasing the savings associated with pickup’s lower fees, no fuel surcharges or zero tips can better protect your online customers and sales by highlighting a more affordable alternative to home delivery.”

grocery pickup

Continue to read full article on Winsight Grocery Business.

Expect Another Transformational Step-Change in Food Shopping

Over the past 100-plus years, the food shopping experience in the U.S. has evolved primarily through large step-changes driven by innovative new store formats. Another such step-change can be expected in the not-too-distant future.

At the turn of the 20th century, food shopping was complicated and cumbersome. Consumers purchased their meats from the butcher’s shop; produce at “green grocers” or fresh markets; breads and pastries from bakeries; and shelf-stable, packaged food products at “dry grocery” stores such as A&P, the dominant such retailer at the time. In all instances, the stores were operated by clerks to whom the order was given and who would fulfill the order by picking items off shelves and displays behind a counter. Many of these stores allowed their customers to order remotely by note and later by phone, and clerks would prepare the order for pickup or even deliver it to the customer’s home.

A radical change was ignited in 1916 the dry-grocery segment when Clarence Saunders launched Piggly Wiggly, the first successful operator of “self-serving” food stores. In these stores, there were no clerks or counters between the customers and the products on shelves. Prices were displayed on tags, and customers collected their own items in hand-carried baskets and then went through a checkout station to pay for them. Customers very much liked the 20% reduction in prices enabled by the huge improvement in operating efficiency through the elimination of clerical labor costs.

Even more importantly, though, customers actually preferred this way of shopping over clerk service for two primary reasons. First, customers had direct access to product information and prices, enabling them to make purchase decisions at their own pace without feeling the pressure of occupying the clerk’s time. Second, they didn’t have to wait to be served by a clerk during busy periods. As a result, dry-grocery stores began a rapid shift to the self-service model, which transformed not just food retail but eventually all of retail.

Digital changes everything

Even though the emergence of e-commerce has dramatically impacted almost every other segment of retail, it had very little impact on customer experience in food until quite recently. This is due to a variety of unique challenges associated with selling food online, the most fundamental of which are (a) the cost to the retailer of performing order-fulfillment processes that are free in the self-service model and (b) the fact that raising prices to cover these additional costs is not realistically feasible.

Continue to read full article on Mass Market Retailers

Answering the call for micro-fulfillment

Automation vendors, including several startups, are lining up to meet the growing interest in micro-fulfillment centers. Automation characteristics like high storage density, rapid access to totes, and high uptime are vital to success, but vendors also point to the need to iron out supply chain issues like replenishment.

Read the story here as a PDF:

Answering the call for micro-fulfillment

PODCAST: Robots! and how they will transform grocery shopping

Thank you to Peter Crosby and Rob Gonzalez for featuring Alert Innovation’s Founder and CEO on the podcast Unpacking the Digital Shelf, by the Digital Shelf Institute.

 

We got to talk about Alert Innovation, the automation of grocery stores, and all things robots. Listen to the episode or view the transcript here:

https://www.digitalshelfinstitute.org/podcasts-interview-robots-how-they-will-transform-grocery-shopping-john-lert

 

There are links on the page above to subscribe to hear it on whatever Podcast platform you use (ie Apple, Spotify, Google Play).

 

What I Learned on my Summer Internship - How to Work Alone

One of our summer Interns in electrical engineering was profiled in a story on the front page of Wall Street Journal today.

We were able to do some great work with our Interns this summer, whether that meant software coding done remotely, shipping them mechanical projects to work on remotely or having them work part time, safely,  in our lab (as Manjusha Chava did).

We had 15 paid interns this summer, down from our normal 30. We will be interviewing again this Fall for next summer’s program. Join our mailing list (email field in footer of this page) to make sure you know about the recruiting schedule.

Read the story here as a PDF:

What I Learned on My Summer Internship_ How to Work Alone – WSJ

Read the story at the Wall Street Journal website [paywall].