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How Grocers Can Implement E-Commerce Strategy

Before the spread of COVID-19 throughout the United States, retailers were steadily adapting their operations, modernizing them to meet today’s demands and trends. In particular, more online-friendly, e-commerce solutions presented themselves, offering retailers the chance to connect with potential customers through more techy options. From online supply chain giant Amazon to food delivery apps like Postmates, direct-to-consumer services have seen massive growth.

And while the grocery industry started tinkering with the online food ordering and delivery space in recent years, the coronavirus pandemic has thrust it into a full-swing motion of e-commerce. As eCommerce’s share of overall retail sales surged past an estimated 25 percent (up from 17 percent in 2019), the consumer packaged goods (CPG) industry has rushed to change to a rapidly evolving business model. 

Companies have scrambled to add fulfillment capacity over the past several weeks as shoppers have migrated to the safety and personalization of online grocery shopping. Retailers face the hurdle of not just improving online fulfillment, but also achieving legitimate profitability on a more streamlined timeline than most initially thought.

To better understand this new grocery e-commerce model and what retailers have to do to prepare for it, here are some top strategies grocery stores can use.

Insuring the Future

With the instant shutdown of local economies and grappling with the new normal due to the coronavirus, many questions remain about how to keep business going and keep companies safe from further claims. With a pandemic among us, grocery stores find themselves with a higher potential for litigation due to being among the few businesses that have remained open consistently. Grocers must take the necessary steps to keep their customers safe, employees healthy, and to protect their business from lawsuits as best as possible.

Success can be achieved by implementing social distancing in stores, encouraging online shopping and delivery, and staying protected with grocery insurance, such as Grocers Advantage. This type of insurance is an essential piece of coverage to ensure that the unique risks that groceries face today and the foreseeable future are protected. While grocery stores have always operated with inherent risks, the COVID-19 pandemic has brought new exposures. Having this insurance can help to keep liabilities low and provide a financial backstop in times of litigation.

Dedicated Fulfillment Space

While it may have been trying for grocers to justify the costs necessary to build dedicated facilities to handle e-commerce orders and audits, that thinking is changing because of the pandemic. For most retailers, including grocery stores, e-commerce hasn’t been enough to call for separate fulfillment capabilities. Until now, grocers were able to manage by falling back on in-store staff members who pick products out for online orders, but the cost of getting products to store shelves leaves little to no room to cover expenses related to fulfillment.

 One way to navigate this effectively is to augment in-store picking services with dedicated space for setting out products and putting orders together. 

Integrate Online and In-Store

Even as grocers look for different ways to improve their online operations, they should also be looking at ways to provide customers with as many aspects of the in-store experience as possible. Grocery stores have to bridge together these two experiences. A major issue they face is that shoppers can see for themselves whether something they want to purchase is on a shelf in the store, but have to rely on a website to get the same information when going online to shop.

This means that grocery stores should prioritize developing ways to get reliable information to the consumer about what is in-stock, and offer comparable substitutions for what is out of stock.

The Long Game

Grocery stores should think in terms of short-term solutions and long-term profitability. These companies should do what needs to be done in the next few months to fulfill order demand and keep customers returning for more orders, even if it means losing money in the near future. Long term, grocery stores need to create a strategy to make e-commerce profitable for that company and then invest in automation.

It’s also important to keep transparency a critical factor in business plans and cultivating growth with customers. As retailers tackle the technical and logistical challenges that go with scaling up their online e-commerce services, they need to build a rapport and a sense of trust with customers.

This can be done by being transparent with customers about any issues that could come up with e-commerce technology and fulfillment issues. From out of stock problems to looking for solutions to glitches, keeping customers aware of the potential pitfalls makes a significant difference.

About Irving Weber Associates
At Irving Weber Associates, Inc., we understand what it takes to run a successful grocery, market, or convenience store, including investing in a comprehensive Insurance Program to ensure that they are financially protected against claims. Our program, Grocery Advantage offers overall business insurance coverages including, Food spoilage,General Liability, Property, Liability, Equipment Breakdown, Workers’ Compensation, Business Auto, and many more. For a detailed look at how we can help you safeguard your business with a custom-tailored package, please contact our experts today at (800) 243-1811.