The allocated area to the fresh-food section in the retail store reflects the consumer demand.
However, it is always critical to have optimal stocks for every fresh-food to fulfill the demand during high/low/medium traffic in the stores.
For that to happen retailers need to keep an eye on the fresh-food section more than anytime because Consumers’ demand for fresh food continues to be strong: Two out of three consumers in the United States report an increase in their category purchases over the last two years.
Why it is important
The fresh food is liable to rot easily and consumer demand is highly uncertain in this section. Retailers need to maintain a stock not too much to waste and not too little to lose on the sales. So, the first thing retailers should have is demand prediction analysis in place to know the optimal inventory and the second is to check whether they are keeping the stock maintained or not.
To understand the importance of this a bit more – According to a Nielsen study, fresh foods are the primary driver of growth in retail stores, accounting for 49 percent of all dollar sales growth in the fast-moving consumer goods (FMCG) industry.
How they do it
- Few stores stock in the morning and they know they do not sell more than this.
- Some stores do re-stocking rounds during the day.
- Some have ground staff in stores for keeping a check on the stocks and report for stocking.
Checking optimal availability for every individual SKUs manually is time consuming, error prone, and heavily reliant on individual planners’ experience and gut instinct. Also the follow up action of replenishment is delayed due to delay/inefficiency in information transfer.
And on top of that, Retailers always have to hire a resource for this check and spend extra for this purpose.
How to improve
First thing’s first, retailers should adopt technology where humans are doing stock measurement, so that no humans have to guess the present stock.
One emerging technology is Image recognition for gap scan. Either you place camera on the
Section and let the camera click the picture periodically and send for image processing, or a ground staff can be sent with a mobile app to capture the image and upload for image recognition.
Second thing, retailers can have a ground staff app, to get the notification of stocks measured by image processing so that they can go and replenish the stocks.
Unpredictable consumer demand makes it a tough job for retailers to maintain optimal stocks for fresh-foods. However, today’s technology has several offerings to solve such issues. Explore xTract – an Image recognition solution for retail for more information.