ZEBRA Report Examining Smarter Operations in the Grocery Sector User Guide

Helping grocers innovate for smarter operations today and in the future

An exclusive report for the grocery sector, prepared by Zebra Technologies, outlining how grocers can equip their employees with innovative technology to better serve the customer and future-proof smarter operations.

REPORT OVERVIEW
INTRODUCTION

Introduction

Building smarter operations

As a recognised leader in location solutions,* Zebra Technologies is perfectly placed to help grocers create a more agile, flexible workforce to deliver more efficient operations for today and the future. The grocery sector has an exceptionally large workforce: Over 1.1 million employees in the UK** performing a multitude of tasks at any given time, such as replenishing stock, operating checkouts and increasingly picking online orders. Our experience has shown that by equipping these employees with technology configured specifically for the grocery market, grocers can work smarter to better serve their customers.

Zebra has an award-winning portfolio of solutions, working with grocers to develop first-in-class, forward-thinking solutions. This report has been prepared based on our understanding of the sector, leveraging insights and trends uncovered from Zebra’s Annual Global Shopper Study 2022. The report will explore the changing landscape of the grocery market and will evaluate how implementing smarter technology can encourage better employee engagement and enhance customer service.

By working with many of the largest retailers and grocers, we have developed a unique portfolio of hardware, software and integrations. These combine to deliver solutions that elevate employees across the store to become product experts, encourage the adoption of automation such as self-scan/service checkouts, and optimise store operations. The result is a well-trained, agile workforce that can work smart to better serve customers irrespective if they shop online or in store.

Our analysis indicates that grocers could benefit significantly in terms of reducing the cost to serve by adopting some of the innovative grocery technologies outlined in this report. With employees being a grocer’s biggest asset, engaging and upskilling the workforce with modern, forward-looking technology would help grocers fast-track their transformation to smarter operations.

We hope you find this report useful and welcome the opportunity to partner through co-innovation, workshops, assessments and new solutions that are highlighted throughout the report.

*Source: Gartner magic quadrant 2022
https://www.gartner.com/en/documents/4012884
**Source: Statista.com
https://www.statista.com/statistics/315887/food-retailing-workforce-in-the- unitedkingdom-uk/

CONTENTS
WHAT’S INSIDE THIS REPORT

What’s inside this report?

This report describes how grocers can implement innovative technology to achieve smarter operations for today and the future. It is broken down into 5 sections:

1. The Evolving Landscape of Grocery Retail Operations
An overview of the grocery sector as it is today and how emerging trends are changing the way employees are expected to work to meet rising customer expectations. This section explores how grocers must expediate innovation in new store technology to operate smarter to stay competitive.
2. The Key Foundations of Smarter Grocery Retail
An exploration of the 4 areas of the grocery business that underpin the success of implementing new, smarter technology for a better employee and customer experience.
3. Innovative Solutions to Future-Proof Operations
A closer look at Zebra’s leading grocery solutions and how they can provide grocers with the tools needed to motivate employees and drive better, smarter working practices across the store.
4. Retail Maturity Model for Associate Performance
An introduction to Zebra’s new maturity model which enables grocers to assess where they are today and where they need to make improvements to ensure success for the future.
5. Next Steps
A summary of the report findings along with recommended next steps.

GROCERY INNOVATION
THE EVOLVING LANDSCAPE OF GROCERY RETAIL OPERATIONS

An exploration of why innovation is key for smarter grocery operations

in order to stay competitive

In recent years, market disruption has triggered significant changes in the grocery sector. Changing shopper behaviour coupled with supply challenges such as rising fuel costs are having an impact on what is expected of employees in store. Customers now demand more choice and convenience in the way they shop for food, be it in-store, delivered at home or through click and collect.

69%
of customers prefer a blend of in-store and online shopping

60%
of customers prefer stores that allow click and collect

73%
of customers prefer having items delivered rather than picked up

Grocers are pivoting their operations to invest not only in the latest technology but also in their employees to ensure better retention and to drive customer experience.

Grocery employees previously had defined roles, such as manning checkouts or restocking shelves. But this increased demand for convenience means store employees must now switch between a range of tasks:

• Picking online orders
• Handing over click and collect
• Delivering goods
• Advising customers on the store floor

This significant change in an employee’s role within grocery has caused disruption as they are now required to work over and above their previous roles. In a sector where employee tenure is exceptionally short, grocers must implement an innovative strategy to motivate and retain employees, stay competitive and keep control of the cost to serve.

Maximizing customer service while controlling costs has been aided by the increased adoption of automation in-store. Self-scan, self-service, cash-free payments and contact-free experiences are already expected by consumers in store. Grocers must ensure they continue on the path to automation innovation to stay ahead.

This increase in automation sparks a further change in employee roles in store. With less time manning checkouts, employees can switch to other tasks giving rise to more opportunities for training and upskilling. If grocers capitalise on this shift in employee duties and invest in employees through technology and training, the nature of the grocery workforce could change significantly in the coming years. Employee retention and loyalty could be achievable, which positively impacts customer experience and reduces the cost to serve.

GROCERY INNOVATION
THE KEY FOUNDATIONS OF SMARTER GROCERY RETAIL OPERATIONS

Foundations to Grocery Transformation

To future-proof success, grocers must implement innovative technology today in order to dampen the effects of market movements and customer challenges. The increasingly high expectations of shoppers are the main driver for change in grocery — from the multitude of delivery and in-store shopping options to the need for more information on products, prices and sustainability measures. Today’s customer demands have caused a seismic shift in the responsibilities of employees, with a huge impact on employee satisfaction and engagement.

Grocers need to put their employees at the heart of the store operation and invest wisely now in the core of their business. We have identified four key areas where innovation is critical for grocers to enable their employees to deliver the success they seek:

Employee Experience
The expectations placed upon employees has risen and they are now required to perform many roles in store. This can lead to confusion and inefficiencies if employees do not know what is required of them and when. By investing in technology that informs and empowers the workforce, grocers are investing in their employees, which leads to better employee experience.

Merchandising
Shoppers expect to see continuity across the product offering in-store or online, and grocers must ensure that product availability is consistent. The biggest challenge, however, is ensuring there is always the right allocation of employees to serve these customers regardless of how they choose to shop. By using technology that can alert store staff of fluctuations in e.g., the volume of online orders, they will be able to switch between tasks to meet the changing demand, therefore working smarter and more agile.

Loss Prevention
With many more outlets delivering groceries to consumers, the risk of declining profit margins is increased as operations become more complex. By providing store employees with better tracking technology that relays comprehensive stock information, store losses can be minimised through better stock rotation and replenishment of products purchased online.

Fulfilment of Orders
As a result of rising customer expectation to be able to shop flexibly, fulfilling orders has become more intricate and time-consuming, adding additional pressures to an already complicated operation. However, fulfilment- driven solutions are trailblazing the grocery technology advances. Equipping store employees with technology that enables them to pick, pack and deliver quicker and as required will allow store operations to be streamlined to meet changing customer demand.

Grocers must adopt a digital-first mindset to keep pace in an industry that constantly evolves. Streamlined workflows, more inventory transparency and an empowered workforce — all enabled by technology — combine to create a better customer and employee experience.

SMARTER GROCERY OPERATIONS
INNOVATIVE SOLUTIONS TO FUTURE PROOF OPERATIONS

Zebra’s Solutions for Smarter Grocery Retail Operations

For grocers to achieve smarter operations, they must put innovative technology at the heart of their operation, empowering their employees. Due to Zebra’s experience in the grocery sector, we have developed strong groceryfocused solutions that motivate and enable employees to do a better job to deliver exceptional customer service.

Zebra’s solutions for an agile workforce

Zebra offers solutions aimed at grocery employee engagement. With a technology suite that makes employees more informed, Zebra’s solutions enable them to work cross-functionally, stay motivated and do a better job overall.

Task Management Tools
Empower shop-floor employees to swap seamlessly between tasks as customer demand requires with minimal supervision.

Communication Tools
Better connect employees across the store to have all information on products, stock levels and in-store situations to better serve customers.

Workforce Management Tools
Accurately forecast and schedule labour-based upon expected footfall to ensure employees are utilised, motivated and engaged in their role.

Zebra’s solutions for better inventory management

Zebra’s leading technology for inventory management sparks innovation across the four key foundational areas ensuring:

On-shelf Availability
Ensure employees have visibility of product levels so they can prioritise restocking shelves ahead of an increase in footfall in-store and picking orders online.

Merchandising Compliance
Visibility across inventory platforms permits continuity in pricing, promotions and offer both online and in-store.

Inventory Accuracy and Visibility
Tracking SKUs accurately means grocers can forecast demand and can better serve customers.

Loss Prevention
Understand stock loss at an item level — where it happens and why — and develop processes for employees to minimize it.

INNOVATIVE SOLUTIONS
RETAIL MATURITY MODEL FOR ASSOCIATE PERFORMANCE

Introducing the Zebra Retail Maturity Model for Associate Performance

Zebra’s wealth of experience in the grocery sector enables grocers to implement solutions that help them better understand what motivates shoppers and develop innovative ways to elevate customer engagement. Zebra’s purpose- built solutions help grocers make every interaction count where it matters most ­ on the front line of the business, on the store floor.

Using Zebra’s new maturity model, grocers can assess where to make improvements in the customer experiences delivered by their employees:

Zebra Associate Performance

PHASES

| WORKFORCE MANAGEMENT| TASK MANAGEMENT|

COMMUNICATION AND COLLABORATION

|
---|---|---|---|---

OPTIMIZED
Maximize Labor Resources
4

| Automatically improve workforce scheduling and budget forecasts| Automatically combine all assignments into one prioritized task list|

Automatically configure talk groups and features based on roles

INTEGRATED
Integrate to Augment
3

| Automate schedules to match fluctuating demands| Integrate labor planning into task management|

Integrate inbound and outbound calls

EMERGENT
Expand Capabilities
2

| Automatically track labor compliance| Manage tasks at scale|

Expand communication features

BASELINE
Initiate Improvements
1

| Improve the manual management of your workforce| Increase task efficiency|

Digitize communication to accelerate responsiveness

Enabling associates to better serve customers and deliver a great store experience
Store employees are the front line. They need tools and data at their fingertips to deliver the best possible customer experience. From helping with on-the-spot product enquiries to serving at checkouts or pickup points, store employees must become grocery experts.

Never keep a customer waiting
Today’s shoppers don’t have time to waste buying food, especially in check-out lines. Prevent lost time for customers and potential lost sales with fast and convenient check-out options. Accelerate customers shopping trips by moving customers out of line and out the door quickly, while still feeling like they’re your top priority.

Accelerate technology adoption
Equip your employees with technology to better support customers and drive improved results. Make it easy with grocery-ready solutions that provide full visibility to the store operations and enable employees to serve customers better with accurate information across all SKUs.

Ensuring Smarter Operations with Digital Technology Across the Store

The possibilities are endless with Zebra

Grocery transformation is a constant process, but the speed at which the industry is now changing is truly unprecedented. How can grocers adapt to meet these changes? By working smarter and driving better outcomes. The only way to do this is by optimising each and every retail touchpoint through smarter digital transformation.

The best partner is the one with decades of experience. The best partner is Zebra.

This report has been prepared exclusively for the grocery sector and uses information available in the public domain combined with exclusive information and thinking from Zebra Technologies.

To discuss the contents of this report, or for a general discussion on how Zebra can support grocers on the quest to innovate and implement smarter technology in operations, please connect with the Zebra account manager.

Mark Thomson

Retail Industry Director EMEA
mthomson@zebra.com
www.zebra.com

To learn more, please visit
www.zebra.com/retail

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+1 800 423 0442
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ZEBRA and the stylized Zebra head are trademarks of Zebra Technologies Corp., registered in many jurisdictions worldwide. All other trademarks are the property of their respective owners. ©2022 Zebra Technologies Corp. and/or its affiliates. All rights reserved.

References

• Statista - The Statistics Portal for Market Data, Market Research and Market Studies
• Summary Translation: Magic Quadrant for Indoor Location Services
• Food retailing workforce UK 2022 | Statista

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