Key Concepts & Topics in Grocery Store Management
Your grocery store serves customers with various preferences, levels of brand loyalty and budgets. Shoppers seek merchandise to restock their households, prepare for a special occasion or a specific meal, or complete a particular task such as cleaning. The store's profitability and community standing depends on effective management to meet their customer needs and tastes.
Your store’s management needs to anticipate and respond to customer demands. Patrons, seeking lower grocery bills, may choose lesser-known brands or private labels over national brands. Customers desire variety, but too many options may overwhelm customers, especially those on short shopping trips. Small or medium-sized stores (even some supermarket chains) can stand out by selling locally or regionally-produced foods and cooking ingredients.
Groceries account for roughly half of the business’s assets. Your store must effectively manage inventory to meet customer demand and encourage profitability. Groceries tend to move quickly. Many staples such as milk, eggs, meat and bread, have very short shelf-lives – as little as 10 days. Depending on your size, your product selection can number into the tens of thousands. Holidays and special occasions increase seasonal demand for specially-shaped or packaged foods. Tracking inventory can involve eyeballing shelves, manually counting shelves or using computer systems.
Many grocery stores rely on discounts, weekly specials and customer loyalty programs to attract customers with pricing. Small or independent stores have difficulty matching the lower prices of major chains. If you cannot compete on price, you can highlight personal customer service, fresh, locally-grown produce and community ties, especially if you run a rural, neighborhood or small-town store.
Typically, store managers group aisles and sections by product type. Product manufacturers and supplies particularly covet end-caps and other prominent space in your store. You might consider charging a slotting fee, whereby the producer pays for the space to cover the prime real estate that might have otherwise gone to a higher-selling product. Since customer tastes and needs change, your slotting arrangements should last a short time, say six months or even less.
Clean, uncluttered aisles and safe employee practices reduce the risk of workers’ compensation claims by injured workers and lawsuits from injured customers. Store staff should immediately clean spills and mark areas of wet floors. Managers should train and instruct associates in proper lifting techniques, such as using the legs and keeping items as close to the body as possible; cashiers should stand straight and avoid bending as much as possible. The Occupational Safety and Health Administration requires your store to report and record injuries and illnesses related to work at the store.
Grocery stores can avoid lost revenue and sales through shoplifting prevention, accounting controls and faster customer service. Managers should properly maintain and, if necessary, repair or update security cameras throughout the store, including cash registers. Longer check-out times cause loss prevention because customers have more time to second-guess purchases or less to wait at the store, Your store should have express lanes (accepting 12 items or less) and more lanes open during peak customer times, such as late afternoon or weekends.