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LS Retail’s solutions to common grocery replenishment mistakes

April 7, 2022 IN THE CATEGORY: Supply Chain

LS Retail, SPAR’s preferred supplier for retail management software for SPAR wholesale and retail partners worldwide, has identified five common replenishment bottlenecks in food retailing and offers innovative software solutions to resolve these.

Data volume

Data volume is one of the biggest challenges for food retailers today. When managed properly, data can be turned into valuable insights to support targeted, accurate replenishment, increased sales, and minimal waste. But many food retailers are not making the best use of data.

The replenishment processes need to be connected to the rest of the IT setup. The retail management system should encompass the entire organisation and all channels. Data about each product, its sales history, and availability should be gathered from all channels, locations, and sources in real-time.

Manual replenishment

It is not uncommon in food retailing for retailers to handle their replenishment without automated processes. In a recent survey published on Logistics Manager, 46% of UK grocery directors said their replenishment is still an entirely manual process that relies on ‘gut feel’.

By automating the replenishment process, food retailers can minimise errors while maximising efficiency. Manual processes are not only fraught with errors; they are also time-consuming. A huge advantage of automated systems is that they can handle all routine replenishment tasks, giving the retailer time to focus on other tasks. A good system can process real-time information about demand and stock levels across the business while applying the rules and parameters that the retailer has set for each type of product.

Too broad, or too detailed, rules

Grocery involves an incredibly diverse assortment of item types, all of which need to be treated differently. Those items have varying shelf lives and, especially when it comes to fresh produce, anything that isn’t sold in time often has to be thrown away. At the same time, a product’s demand cycles can be influenced by anything from the weather to promotions by local competitors.

An advanced replenishment system should be able to propose quantities using different rules, for example, based on store size or historical sales – of course, always leaving you the possibility to overwrite manually. To make sure that item distribution across the chain matches customer demand in each location, the retailer should select a system that works with different models.

Disconnected channels

Real-time stock information is no use if it only reflects some of the channels through which a retailer sells. With the increasing popularity of online grocery shopping, supermarkets are experiencing a pressing need for replenishment systems that provide real-time visibility into all the channels involved in the purchase. The online store or app, the warehouse or local supermarket that fulfills the order, and the delivery service must all be seamlessly connected.

Food retailers should consider how the replenishment system connects and communicates with e-commerce, brick-and-mortar, logistics, and other external partners’ systems. By using a software solution that unifies the front office, back office, inventory management, and all sales channels within the same platform, retailers can get seamless visibility into sales across the channels and ensure that inventory is always correct throughout the enterprise.

Gaps in the system

Efficient replenishment depends on a wealth of information from many systems across the store being always up-to-date. However, a surprising number of food retailers are still working with separate or loosely connected systems for their processes.

Connecting the different parts is the only way to avoid this mistake. Retailers have to build bridges between their existing systems and invest in an end-to-end, unified commerce system that integrates all aspects and processes of the operation, replenishment included. With a unified system, all the data the retailer needs for accurate stock information and forecast calculations are collected in a central place in real-time.

Read more about our preferred supplier LS Retail solutions for the replenishment bottlenecks listed above.