A confluence of globally disruptive events, shifting consumer preferences and ongoing labour challenges are eroding the effectiveness of traditional grocery retailer strategies. Grocers looking to defend and extend their competitive advantages in this quickly evolving industry can’t afford to stick to the status quo. Finding themselves at a crossroads, many grocery retailers are going beyond the ad hoc digitalisation efforts of the past few years to systematically invest in technology modernisation to enable new grocery industry strategies.
Doubling down on a data foundation is the place to start in grocery industry transformation. Whether pursuing e-commerce or quick commerce or partnering with new start-ups, many grocers have tried to optimise small parts of their value chains. But, cobbling together dozens of solutions that don’t speak to each other creates brittleness and confusion—just the opposite of what is needed in a world that demands constant adaptation. Once out of reach as an enabler of growth strategies for grocers, new integrated platforms offer interoperability and a unified enterprise-wide data backbone. By modernising their data foundations, grocers can transform the deluge of available data into contextual insights they can use. Individuals across the enterprise can collaborate in real time around a single source of truth and they can access the relevant information they need, as they need it. Ultimately, grocery retailers can use these insights, along with empathy for consumers, to evolve their offerings and options and to meet omni-channel shoppers wherever they are.
Retaining talent has become a grocery industry survival strategy. Employee churn has long plagued the grocery industry, but wage pressures, fierce competition and evolving worker expectations around flexibility and professional development have pushed the problem to a breaking point. Consider scheduling, long a point of contention between frontline workers who have varying desires for flexibility and stability and supermarket managers who must balance dynamic business needs with labour costs. Scheduling that relies on siloed data tends to be tedious for managers and out-of-step with worker wants. An integrated, cloud-based platform offers a way to empower both workers and managers. When labour spending, productivity KPIs and workforce analytics are seamlessly connected in a single system, frontline managers can automatically generate optimised schedules and assign workers at scale, while easily balancing worker availability, preferences and qualifications. Frontline workers are empowered with far more agency, using streamlined tools to update availability, request swaps or pick up additional shifts. Forward-thinking grocers are more clearly connecting the dots between employee experience and talent retention, leveraging digital tools to empower and engage workers, create frictionless workflows and enhance career development.
While it is unlikely that intelligent robots will be stocking shelves any time soon, the rapid advances in Generative Artificial Intelligence (GenAI) and machine learning are prompting grocers to reconsider their staffing and organisational models. As self-checkout adoption soars, for instance, the number of employees needed to manually scan groceries will continue to decline. But demand for digital skills among cashiers was 5x higher in 2020 than in 2017, according to a recent report from Deloitte and the Food Industry Association. As grocers seek to attain the right skills mix for in-store and multi-channel capabilities, the ability of intelligent automation to unlock human potential cannot be ignored. For example, AI can guide frontline workers on task prioritisation, helping them to be more productive and focused. It can also free significant bandwidth for store managers long consumed by performing routine tasks and transforming static data points into action plans—providing, for example, insights that connect a dip in sales to the underlying factors and helping managers figure out how to react. Beset by disruption on all sides, grocery retailers recognise that change, whether fuelled by AI or other trends, is an absolute given. Featuring five fresh grocery retailer strategies, read the full report to learn more about how Workday and Deloitte are helping grocers to adapt and grow.
In the U.S., 7 in 10 retail executives consider labour their number one challenge, according to Deloitte’s 2023 Retail Industry Outlook.
Workers who are confident in their professional growth path are 3.3x more likely to stay at their current employer for the 12 months, according to Deloitte research.
Grocery retailers have traditionally stuck to the same patterns for growth to draw customers into the shop, to keep proliferating shops into the community. But those patterns alone are no longer enough—and so you see grocery companies investing, some for really the first time, in tech modernisation.
-Thomas McElroy, Retail Industry Leader, Business Model Transformation, Deloitte
Every grocery retailer is now rethinking how they look at their staff and their organisation and asking: Have I got the right roles? Have I got the right skills
-Keith Pickens, Managing Director, Retail Industry Workday