Grocery Retailers versus Online Retail
Since the boom of online retailing, there has been this discussion going on contrasting online and offline retail. Then why should be considered different than other vertical of retail? The importance of Grocery Industry can be highlighted from the fact that every household shops for groceries at least once or more in a week. Therefore, it's not just the quality that is important but also how fast you get your groceries at your doorstep!
Brick and mortar retailing does involve huge investments, including real estate, manpower, retail ERP, to manage all from inventory to POS software. And in Online, when said that lesser investment is required, it is not true. So basically it depends; mainly 3 different models are used by online grocery retailers- Inventory, Hyperlocal and Mixed Model.
In inventory based, the online retailers maintain their own inventory which is capital intensive, as they not only require a cold storage but also a smart inventory management software. But at the same time, the manpower required is less and also the delivery time can be managed more efficiently. In the Hyperlocal based model, no inventory is managed on their own, which reduces the retail software cost but also increases the manpower and the delivery time. Lastly, the mixed model uses a bit of both of the above-mentioned models. With the pros of both, it also receives all the cons, thereby, making it costlier.
But the factors that will lead to the success of Grocery Retail, through any channel, will depend on the following:
1. Figure out the last mile: The last mile — getting goods from the final delivery hub to a consumer — will continue to challenge grocery retailers. For offline it matters, how fast the customer can check-out, and in online how fast the goods are delivered to the customer's place.
2. Transparency towards the supply chain: Retailers need to adopt a multi-dimensional supply chain grid model. Both the models require adaptable supply chain processes to meet the personalized point-of-purchase, consumption and return needs of today’s customers.
3. Shopping experience over price: Now the trend for customers have shifted from price-sensitive to experience. Grocery shopping can be positioned as an extension of a health and wellness lifestyle and providing customers good loyalty programs.
4. Personalization enabled big data and analytics: Big data mining, reports and analytics will continue to gain traction among grocery retailers/online retail. As a result, retailers can provide more personalized grocery shopping experiences, which in turn could translate into increased sales and repeat visits by loyal customers.
Ginesys Retail ERP can help enhance both the channels - offline or online, by providing a smart and fast POS software, efficient supply chain management, customer loyalty programs and the new Reporting and business analytics tool; thus providing the user with a complete omnichannel experience.