Successful retailers are changing their approach to smarter operations, the customer experience and inventory management, writes Mark Thomson, EMEA director of retail and hospitality Solutions at Zebra Technologies.

In recent years, retailers and grocers have prioritised building smarter operations, elevating the customer experience and optimising inventory. Although Covid-19 may have changed the way some retailers execute on these three pillars, it has not diminished their importance.

Thriving retailers will develop strategies that enable them to adapt to unanticipated challenges, such as the ones seen during the pandemic, and technology will play an important role in helping them rebuild.

Labour costs have traditionally been the retail industry’s largest expense. Increasing the productivity of store associates has always been a focus for retailers, and with the pandemic increasing the cost of labour for many retailers, ensuring associate efficiency will be even more critical.

Factors such as higher hourly wages, bonuses for front-line workers, and protective personal equipment (PPE) are all increasing labour costs. In addition, implementing new process changes to address safety and health concerns, such as door marshals, frequent store cleanings and health screenings are incurring additional cost.

Improving workflows and productivity via mobile applications

In order to help control the cost of labour, many retailers are turning to technology to improve workflows.

Of course, I could talk about robotic cleaners or automated door entry systems, but the real answers are simpler. Technologies such as mobile computers and tablets that allow employees to truly multi-task, helping increase worker productivity and optimising workflows.

Tasking applications have become increasingly important during the pandemic as they have helped guide associates through their shifts while allowing management to assign tasks and request status updates of shift activities.

These applications also allow employers to view their associates’ timestamps and location at any given time, enabling smarter use of staff where they are closer to the point of need and saving staff walk time. This is no different to the way we all use our personal smartphones to improve our personal productivity.

Retailers can also benefit from analytics applications which utilise machine learning (ML) to identify the best next action for store associates and alert them via their mobile devices. These applications also capture valuable data that can be fed back into the ML algorithm to continue to create a smarter store.

Grocery stores will evolve, even post-pandemic

The pandemic has created a shift in the grocery experience as we know it. Online grocery was already growing at over 22% per annum according to Kantar, and even in the UK where online grocery was thought to be relatively mature, the pandemic accelerated this by over 40% making online grocery over 12% of sales.

It was anticipated that it would take years for online grocery shopping to grow as quickly as it did. Customers who continued to shop in-person were faced with big changes in-store, including plexiglass barriers at checkout, one-way aisles, limits on the number of shoppers allowed inside the store at one time and more out-of-stock items than normal.

Inventory demands resulting from the pandemic broke many retailers’ supply chains and caused unprecedented out-of-stocks.

Many retailers are facing the challenge of getting their supply chains to a level at which they can fulfill their customers’ demands as well as re-tasking store staff to focus on replenishment of high demand items.

Online orders combined with shoppers buying more product than what they would traditionally purchase at one time makes it difficult, if not nearly impossible, for retailers to have the inventory they need, where they need it and when they need it.

The costs associated with online orders combined with the expense of expediting products is impacting retailers’ margins.

Online grocery shopping is here to stay but so is the in-store shopping experience. Grocers must provide shoppers with an enhanced experience both online and in the physical store to retain loyal customers and draw in new ones.

Grocers who do not offer online shopping will need to adapt so they don’t lose customers seeking those contactless experiences.

Online grocery shopping needs to be intuitive, offer accurate inventory information and enable curbside pickup and contactless payment.

Retail brands must recognise that they are now digital brands, and their future success will be determined by their selection of groceries and how well they are able to communicate their values, commitment to customers and associates, position on health and safety and role in the communities they serve.

Addressing supply chain challenges

Retailers are also utilising technology solutions to automate their supply chains and incorporate new concepts like dark stores, hybrid stores, micro-fulfilment centers (MFC) and centralised fulfilment centres (CFC).

All of these concepts allow retailers to cost-effectively fulfill online orders quicker and with fewer substitutions (a costly challenge for retailers).

Retailers are also utilising smart intelligent automation in the form of robots to help them identify on-shelf inventory gaps, planogram compliance and pricing integrity.

The robots analyse what they see on the shelf (including whether the price label is correct) and then provide the appropriate staff members with real-time information needed to take immediate action.

Shelf-edge cameras using video analytics can also monitor on-shelf inventory and send alerts to store associates instructing them to pull product from backrooms or other areas within the store to fill shelf gaps and ensure availability for shoppers.

Combine these sources of data and machine learning analytics engines capture and process data from numerous sensors including robots, shelf-edge cameras, point of sale (PoS) solutions and associate mobile devices. These engines are generating prescriptive actions for store managers and associates empowering them to create a better performing and much smarter store.

As retailers adjust to the changes caused by the pandemic and begin to implement automation and other technologies that maximise labour productivity, elevate the customer experience, and improve inventory management, they will make new adjustments to associate workflows.

Some of these workflows will be eliminated while other workflows are performed by robots and shelf-edge technology, freeing up human workers to focus on more specialised and higher-value tasks.

These new inventory management technologies will make it easier for stores to monitor stock and place orders right away when a product is no longer available. Associates will only intervene in the final step of the process when they are alerted with a task on their mobile device.

Although it’s unclear when the pandemic will be over, consumer shopping habits have changed, and retailers are adapting and will continue to do so.

As retailers continue to rebuild after the pandemic, implementing new solutions to improve productivity and optimise workflows will continue to be a priority.