As per global market research, although traditional brick-and-mortar shops and food retailers will continue to run their grocery retail businesses, the focus is growing on instant online services and a wider reach. To this end, the following two trends are going to have a substantial impact on the future of food and grocery retail businesses:
1. Online Grocery Deliveries
Online grocery/E-Grocery is poised to become the next big thing in the food and grocery retail business, as forecasts show that it will most likely touch $10.5 billion by the year 2023. In the digital era, online food and grocery delivery offer convenience and safety in the light of the present COVID-19 pandemic. Customers are looking forward to making a complete switch to e-grocery services, especially in the urban area, to cut down on time consumed for such routine chores as monthly grocery shopping.
Although there is plenty of growth potential in this business sector, the pace of growth has been slow, as many fear the non-traditional, digital model to be adopted. However, that means with proper guidance, one can make it big in this arena, going so far as to open food retail chains since there is still enough room for newer players in this online grocery business.
2. Dark Stores
The term ‘dark stores’ refers to a retail distribution outlet that solely focuses on online shopping. In other words, it is a giant warehouse that facilitates a click-and-collect service whereby a client collects their ordered item. Since dark stores act as fulfilment centres that cater to the customers online through the online mode, one does not require a lot of manpower for entertaining customers’ in-store. A Deloitte report goes on so far as to say that Dark stores, with their D2C (Direct-to-consumer) model, will be a pivotal player in the food and grocery supply chain management in years to come. Also, they enable the customers to avail of useful, time-saving services like doorstep delivery, same-day delivery, and online, pre-paid purchases.
Now that e-commerce is seeing its heyday, customers want instant services. To this end, food and grocery retailers may set up dark stores to meet real-time customer expectations across touchpoints, with far less manpower and direct customer engagement. Since customers expect a hassle-free food and grocery retail shopping experience, dark stores also enable customer pick-up options for products, which further cuts down delivery costs. TGloballyo helps in increasing profits and decreasing cart abandonment rates.
Challenges in Food and Grocery Retail
1. Inventory Management
This is amongst the toughest challenges in the food and grocery retail sector. Inflationary pressures can make sales slacken, and sudden demands in the face of global urgencies require the instant availability of products. Dealing with perishables or slow-moving products can become a real problem in these cases. To this end, a robust inventory management system can help food and grocery retail chains and shops to pick up the pace and not fall short of customer expectations. Systems such as ARS (Auto Replenishment System) and well-defined planograms have become indispensable.
2. Brand Building and Connecting With Customers
In this digital era, customers expect fast response and good product quality. In order to ensure customer satisfaction, it is important to build brand value. Companies must incite trust in consumers and use different methods for building rapport and establishing a long-term relationship. Systematically done, this will go a long way to fuel growth.
3. Grievance Management
Now that widespread social media activity on the part of the customers must ensure transparency, bad reviews/ratings can destroy the company’s reputation in seconds. A solid customer grievance redress mechanism will help solve their problems quickly and learn from such complaints about its future growth.
4. Low Margins on Products
This and high operating cost means that retailers must target volumes or lose their businesses to build profits.
5. Supply Chain Management and Logistics
These play an especially vital role for online grocery, and supermarket retailers since logistics for them account for about 45% of the reviews featuring customer dissatisfaction. Therefore a robust operations manual must be in place for the supply chain and logistics management.
6. Fragile Goods Management
The food and grocery retail sector must necessarily face the challenge of fragile/perishable goods management, which must be combated with the help of Careful packaging and expert handling of delicate products. In the words of a YRC expert, “We are focusing on packaging types and patterns more than ever. Our packaging experts are always in the hunt for innovative designs that are bound to make the customers wonderstruck.”
How YRC helps food and grocery retailers across the globe
In order to start an online food and grocery retail store or build a supermarket chain, it is better to depend on the experts in the field. Globally, over the years, YRC (Your Retail Choice) has been the trusted consultant for offline and online and retailers, providing advice on market/business strategies, or CPG (Consumer Packaged Goods) business analytics as well as supermarket expansion. Over the years, YRC has been anticipating emerging trends in the field and implementing technologies as the future of the food and grocery retail industry evolves.
YRC can help food and grocery retail shops leverage the brand value, build businesses through effective campaigns, provide technical and logistical support, aid trade activities, and streamline sales systems for maximum efficiency. It can also come up with a working SOP for the stores. YRC puts strong reporting systems in place, and its retail process manuals are bound to be helpful in the monitoring and expansion of the stock, staff, and sales.
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