Lately, we’ve focused our posts on tips, processes and techniques your retail grocery business can use to minimize cost and maximize profits, what’s known as margin management. We’ve looked at how you can optimize the types and quantities of prepared foods in your store, examined ways you can avoid unnecessary waste caused by product recalls, and dug into how electronic shelf labels can help improve your margins and what they’re going to cost.
Today, let’s dive even deeper into that last topic and talk about eight of the biggest benefits electronic shelf labels (ESL) can bring to your grocery business.
#1 - Accurate, Reliable Pricing
Paper price tags can mean frequent and costly errors. This can be due to “shelf crawl,” missing tags, or pricing that hasn’t been updated. That can lead to unhappy shoppers who feel like they have been overcharged compared to the price on the shelf, or, when the price is too high, it can mean lower sales and excess inventory. ESLs eliminate these issues by ensuring price integrity.
#2 - Channel Synchronization
With ESLs, the price on your store shelf is the same as your price online, on your mobile app, and across multiple locations. This keeps your online and offline channels synchronized to ensure a unified experience for your shoppers have no matter how they engage with you.
#3 - Improved Productivity
Price changes can come in large batches throughout the week, resulting in staffing problems and requiring employees to spend large amounts of time on a task that most find boring. ESLs allow you to improve your staff allocation and use your employees to do what matters—engage and serve your shoppers.
#4 - Price Optimization
Price optimization algorithms allow you to adjust the prices your shoppers pay based on buying practices, supplier prices, and more. ESLs allow you to make immediate price changes based on recommendations from your big data system to boost revenue and growth and enhance profit margins.
#5 - Price Agility
Pricing changes are often time critical, but with paper tags and thousands of products to update, it can be challenging if not impossible to complete this task effectively. ESLs allow your team to update prices and promos on any number of products in just a few seconds.
#6 - Decreased Inventory Shrinkage
Paper labels can fall off or be easily moved. Since ESLs are affixed more securely to the shelf edge, it can make it easier to spot inventory stockouts and ensure better compliance to the planogram. That means you can replace or discount products before they expire to avoid customer complaints and reduce shrinkage.
#7 - Access to Environmental Data
Some ESL devices even have sensors to detect additional information, such as temperature, and warn you when your refrigeration levels reach threatening levels. This allows you to fix the problem before it results in spoiled products and reduced profit margin.
#8 - 21st Century Retailing
Finally, there’s the customer service aspect. A study conducted by KPMG found that 64 percent of shoppers believe a store with ESLs provides better customer service than those stores without.
This could be due to the look of sophisticated technology ESLs bring to your store. Just having them enhances consumer perception of price accuracy. They also allow your store to share important product information, give your shopper the ability to view their savings, and offer options for customers to engage with the labels via smartphones in your aisle.
In today’s retail environment, profitability relies on efficient buying and merchandising along with ways to improve store operations and shopper experience. Electronic shelf labels provide real-time product positioning. They’re the core of any successful strategy for retail grocers and the digital future of stores everywhere.
Ready to find out how margin management solutions like ESL can boost your grocery store profit margins? Learn how TRUNO can help you right away.