Grocers Name Inflation, Supply Chain Disruptions as Biggest ‘Threats’

Invafresh study finds AI, automation being used to lower costs, improve in-store experiences

9/20/2022

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According to a recent study by Invafresh, 37% of grocers believe that technology can help them enhance the customer experience.

Fresh grocery platform Invafresh has revealed the findings of its “2022 Grocery Innovation Study,” which surveyed more than 100 grocery decision-makers on how their businesses are being affected by technology. According to the study’s findings, while 64% of grocers believe that digital-first grocers such as Amazon Fresh pose at least a reasonable threat to their business, their biggest challenges in reality are those brought about by COVID-19; specifically, 58% of grocers surveyed identified inflation as one of the biggest threats to their business, followed by supply chain disruptions (48%), and labor costs and availability (43%).

The study also found that overall cost reduction measures (48%) and a rising preference for fresh food and the need to maintain its quality (43%) are the main reasons for automating grocery store operations, with increasing margins (28%) and reducing food waste (27%) seen as the biggest challenges that technology can solve for the grocery industry.

“Grocers exist at the front line of consumer issues, such as price sensitivities from inflation, supply chain disruptions and staffing shortages,” noted Tim Spencer, president and CEO of Toronto-based Invafresh. “They are compelled to choose technology to address these issues and are increasingly aware of its benefits in reducing costs, optimizing processes, and in improving both product variety and their customers’ in-store experience.”

Invafresh’s study showed that grocers are willing to adopt new technology because they perceive artificial intelligence (AI) and automation as helping to solve the challenges they face. Ways that technology can help include reducing cost (43%), enhancing the customer experience (37%), dealing with the labor shortage (34%), increasing the quality of products offered (33%), and improving visibility into in-store processes (32%).

“Ultimately, grocers want to be able to see and measure the results of their technology investments,” added Spencer. “The positive ROI of automation is leading more grocers to commit to increasing their budgets next year. Grocers are thinking about how technology can be applied across their entire perimeter store operations.”

As well as automation, grocers have become increasingly focused on omnichannel, with 92% having online ordering capabilities, 89% providing online delivery and 81% offering curbside pickup.

Deployed in more than 25,000 grocery stores in 15 countries, Invafresh offers omnichannel demand forecasting, merchandising, replenishment, and sustainability and compliance.