Article

5 Benefits of Automation in Digital Grocery Industry

By
Shalmali Prakash
December 11, 2022

At A Glance

  • In 2020, sales more than tripled average annual growth to 9.5%
  • The increase in digital sales, which were up more than 5 times over 2019, was the primary force
  • Leveraging automation can prove to be one of the most effective ways to ensure profitability and viability
  • Automation cannot just help improve store operations, but also make the warehouse processes seamless
  • Here, we bring to you some of the key benefits of automation in the entire digital grocery space

While the grocery industry has been more or less stagnant for years, the pandemic has brought a sudden shift in the dynamics. Year over year, sales increase by 2.7% on average, as per an Incisiv-Wynshop survey. In fact, just thrice in the previous three decades, sales have increased by more than 5% (y-o-y) - in 2011. In 2020, sales more than tripled average annual growth to 9.5%! The increase in digital sales, which were up more than 5 times over 2019, was the primary force behind this growth.

While there is constant discussion around how digital grocery retail, and as a result, shopper behavior will change over the years, it is evident that leveraging automation can prove to be one of the most effective ways to ensure profitability and viability. Since the environment of the grocery sector is highly competitive, now is a good time to assess the benefits of automation and start working towards building a sustainable growth model. 

Automation cannot just help improve store operations, but also make the warehouse processes seamless. Here, we bring to you some of the key benefits of automation in the entire digital grocery space:

Improve Efficiency

Improvement in productivity is one of the biggest positive impacts of automation. There are numerous routine tasks, including stocking shelves and cleaning aisles, which are important but can take up a considerable amount of time for the employees. This time spent on mundane tasks can otherwise be used by employees to help customers. With the help of automation, these tasks can be accomplished far more quickly while making sure that customer-facing tasks are also taken care of. 

Additionally, automation can also help make complex grocery delivery processes simpler. While purchasing groceries might sound like a fairly simple task, ensuring that grocery stores consistently provide fresh produce is complex. Grocery retailers have to take into account a number of variables, and simultaneously ensure that they can provide customers with affordable products, without any additional logistical costs. 

AI-powered automated systems are effective instruments for boosting operational efficiency. State-of-the-art distribution systems, seamless inventory management, and improved cleaning and hygiene are some of the operational benefits that automated systems provide. Not only operational efficiency, but automation can also help streamline the customer experience. 

Leverage Labor Productively 

The effects of the current labor shortages are being felt by every significant retailer, grocery store, distribution facility, and even by customers. Since the pandemic began, labor pools have shrunk across all significant verticals, and consumer demand has driven manual labor hours to their utmost limit. As a result, customer order lead times and retail stocking times have increased due to supply chain processes being stretched paper thin. One of Spain's major food merchants, Mercadona, has been able to maintain substantial growth over the past two years despite a global labor crisis thanks to automation.   

On the other hand, while grocers still require human resources to deal with customers in person and carry out more intricate and complex tasks, automating time-consuming processes like restocking can allow employees to work on more urgent, value-added tasks concurrently. Consequently, more work can also be accomplished at a quicker pace despite the ongoing labor shortages. 

Enhance Safety

Automation in stores can make them safer for both employees and customers. The most hazardous tasks, such as transporting heavy materials, can be handled by automated devices, keeping workers safe from potential dangers. Similarly, in some cases, automated safety reporting tools lowered workplace injury expenses by 35%.

The use of automated cleaning systems can reduce the risk of accidents. Robots can locate spills and clean them more quickly. Automation reduces slip dangers as a result, thereby protecting both customers and workers. To reduce risks from shared areas, cleaning robots using ultraviolet light lights and other disinfectants can sanitize surfaces. Automated checkouts can give health-conscious shoppers a means to avoid face-to-face contact and the associated airborne contamination risks.

Reduce Fulfillment Time

While a significant rise in consumer demand is excellent for revenue, it can have a detrimental effect on warehouses that are not set up to handle fluctuations in demand or interruptions brought on by seasonal peaks. Empty shelves are the last thing that a grocery store retailer desires. By quickly loading large amounts of goods onto trailers, automated picking solutions can significantly reduce fulfillment time.

For instance, automated solutions could load 21,000 pastry trays every day for Martin's Famous Pastry Shoppe in Chambersburg, Pennsylvania, reducing human labor hours for all orders by 30%. Martin's was able to promptly fill orders and sustain supply lines despite unforeseen consumer and seasonal demand increases thanks to the time efficiency.

Fast-track Shelf Stocking

The advantages of automation extend beyond the distribution center to the grocery store floor. The pallets or roller cages transported to stores are of higher quality when automated processes are used in conjunction with sophisticated software. 

This implies that the pallet's contents may be tracked and traced to ensure that the products arrive in the correct sequence. The amount of time shop operators spend replenishing shelves and interacting with consumers in stores are reduced substantially by organizing the items on the pallet shelves.

Grocery stores should carefully weigh the advantages of automated and AI-powered systems. Automation has already crept through areas such as manufacturing, and grocery stores are next in line. It is the obvious next step in the sector's quest to overcome its present difficulties. The aforementioned five benefits of automation can help better digital grocery operations, be it on the warehouse or store floor. Hence, capitalizing on this movement can help transform the sector for the better, in the long run.