How can smart store strategies streamline retail operations

As the retail industry tackles dramatic shifts in shopper behaviour, broad changes in product assortments, and huge growth in digital orders, innovative merchants are responding to these market shifts with laser-focused, technology-driven customer experience initiatives.

We applaud these efforts. But it’s not enough.

Retailers must also focus on back-office store operations to increase automation, gain efficiencies, and reduce costs because these factors are critical to successful customer-facing functions and financial health. If retailers ignore employees and internal processes, customer experience technology investments won’t have the intended positive impacts.

Don’t get me wrong. I’m not advocating that retailers choose operational efficiency over customer experience. I’m recommending that you align operations and customer initiatives to create a differentiated, tech-enabled in-store strategy.

We call this the smart store.

Below are some smart store strategic imperatives to help you increase efficiencies and improve financials so you have an advantage in today’s competitive retail market.

Combine physical and digital
For omni-channel retailers, the physical store often remains as the most effective and cost-efficient method for online order fulfillment. Some retailers fulfill up to 90 per cent of digital orders from their stores. This approach means retailers must become micro-fulfillment centers—not an ideal situation when store layouts aren’t optimised for product picking and fulfillment. The result is higher cost per order, which could negatively impact the brand.

This problem is apparent, especially in the grocery segment as customers shifted to online orders during the pandemic. Grocers need to equip store associates with mobile AI/ML-based predictive fulfillment tools to quickly and efficiently prepare orders for pickup or delivery. As part of its digital commerce strategy, Co-op, a UK-based grocery and convenience retailer, is using technology solutions from Naveo Commerce and Bringg to reduce the time necessary to find and pick items for digital orders and manage the orchestration of getting the right online orders to the right customers or delivery drivers for fulfillment.

Equip retail associates to engage effectively with customers
As customers demand more engaging interactions with store associates, retailers must equip customer-facing employees with mobile tools to enhance interactions, like conveying information or transacting sales. Store associates need to personalise the discussion, understand all inventory status in real-time at the store and throughout the chain, and seamlessly complete a transaction when and where the customer wants.

Use intelligence to improve retail stock availability
Retailers must always strive to improve product availability and eliminate out-of-stocks. With real-time shelf sensors, video intelligence, and mobile robotics, retailers can quickly identify stock-outs and replenish items.

Use automation and robotics to manage repetitive tasks
There are now several advanced robotics solutions available for retailers to automate high-volume, tedious activities like floor cleaning and inventory replenishment. US grocer Giant Eagle is using AWS partner Brain Corp’s in-aisle robotic platform to analyse inventory and store conditions to streamline restocking and store upkeep.

Don’t forget store associates
Employee training is a key element of any technology deployment. As you plan smart store initiatives, be sure to include training in your project plan. Even if you perfectly implement every imperative outlined in this article, you’ll achieve higher ROI if you train your employees to use and understand the different technologies. You can’t forget about your employees. You must train and course-correct when necessary to ensure your staff is using the solutions to their maximum benefit.

Scott Langdoc is the head of worldwide grocery, chain drug and convenience retail at Amazon Web Services (AWS)