Picking online orders is still causing headaches for grocers on multiple fronts, with customers often groaning about inadequate substitutions or bruised produce and in-store shoppers jostling with e-commerce workers to select products in the aisles.
Major players like Kroger are looking to solve those dilemmas with dedicated fulfillment sites for online orders and automation that takes the burden of order picking off store associates and gig workers. But many other grocers continue to rely on in-store fulfillment for online orders. Sometimes this is by choice — Walmart, for example, is leaning on its existing retail locations’ proximity to customers to help fulfill online orders — and sometimes it’s due to financial constraints that keep them from investing in off-site e-commerce infrastructure.
Sources in the industry outlined three key areas grocers can invest in to help make in-store order picking more efficient while also offering a quality experience to both in-store and online customers: store design, technology and training.
As an incentive to step up e-commerce fulfillment, some companies, like SpartanNash and Shipt, have positioned their workers as high-touch personal shoppers and promoted their services as a competitive advantage.
SpartanNash relies on its own workers to pick and pack orders for its Fast Lane service across more than 70 Midwest stores and for Groceries to Go, the e-commerce service available at its Martin’s banner.
“What we find is that, as our customers get used to the program and used to [SpartanNash’s personal] shoppers who are working, they’re going to say, ‘I specifically want Maria to shop my order. She knows exactly what I’m looking for,'” said Matt Van Gilder, SpartanNash’s director of digital marketing and commerce.
Designing (and redesigning) stores for picking efficiency
E-commerce fulfillment is a “huge” focus for grocers as they consider their store designs and layouts, said Craig St. Clair, associate principal at Cuningham, an architecture, design and planning firm. But the need for e-commerce infrastructure can vary store-to-store depending on customer demand and online order volume.
“It’s a very store-centric thing. Every store has its personality in terms of the customer base around it — if they’re even receptive to doing online shopping,” St. Clair said.
Grocers are hesitant to invest in dedicated e-commerce facilities as consumer interest has waned following online shopping surges early in the pandemic, St. Clair noted. Overall, grocers that are seeing high online order volumes are looking to improve shopper flow and carve out dedicated spaces for online order fulfillment inside their stores, St. Clair said along with Gregory Houck, principal and director of New York at the same firm.
Both St. Clair and Houck stressed the importance of grocers being flexible with their store design so they can accommodate e-commerce workers now and, eventually, automation, which Houck said forward-looking grocers are planning for in the next 10 to 20 years.
In some cases, grocers are moving dry goods and center store to the back-of-house and accentuating fresh foods departments and meal solutions front-of-house, they noted. This can enhance stores’ “fresh” appeal while also pushing aisle shopping, which can get crowded with online and in-store shoppers, to the margins.
Mike Demko, senior vice president and global head of AutoStore Retail, said grocers are carving out dedicated picking spaces inside their stores stocked with fast-moving products.
For example, Angelo Caputo’s Fresh Markets, a grocer in the Chicago area, uses 5,000 square feet at its flagship store to create a “fast pick area” stocked with products that have the highest online sales volume, Demko said.
“If you think about grocery orders, everybody loves bananas, everybody buys milk, so there’s some items that are much faster sellers than others,” he said, noting that grocers can organize products in those dedicated areas based on how fast they sell instead of following in-store merchandising plans, which are made with in-store shoppers in mind.
Leveraging technology to boost speed and service
Grocers and e-commerce providers have been turning to technology solutions to address picking problems, from speeding up the process to improving quality around product selection.
For example, Instacart announced earlier this year an in-store navigation tool with an interactive map of the grocery store to help locate products more easily as part of its rollout of features and services for its shopper community. Last year, Walmart said it saw customer acceptance of substitutions jump more than 95% after pivoting from a manual process for identifying substitutions to employing deep learning artificial intelligence for online grocery orders. Walmart noted deep learning allows it to consider hundreds of factors, like size, type, brand and price, when determining recommendations for out-of-stocks.
The effectiveness and usage of technology to drive picking efficiencies can vary depending on how a store operates, how much e-commerce volume it has, how quick the fulfillment window is and whether humans or robots are doing the picking and packing, sources noted. Speed and order volume, in particular, may determine which picking technology solutions retailers turn to.
A roughly 40,000-square-foot grocery store that uses software and scanning technology to pick multiple orders at a time from stores shelves can assemble roughly 60 to 90 units an hour. A “fast pick area,” like Caputo’s, more than doubles that up to about 150 to 180 units per hour, said Demko, who previously headed up pick-and-pack software company Locai Solutions, which AutoStore acquired last year. Demko also formerly oversaw operations at FreshDirect.
Automation, like robotic picking technology in the back of a store, can bring those numbers up to 400 units per hour, he said.
While automation is still off in the future, mainly due to its high costs currently, sources said they expect robots to eventually take over e-commerce fulfillment.
“The killer of productivity in a store environment is travel distance,” said Demko, noting that grocers need to maximize the amount of work done within that distance or minimize how far pickers walk.
The higher the e-commerce order volume, the more grocers can benefit from bundling batch picking — shopping more than one order at once — with zone-based picking, where certain pickers only focus on pulling items from different aisles, Demko said.
A bagging-and-tagging process where pickers scan barcodes on the products and the bags they belong in can help with that consolidation process downstream, along with ensuring items don’t end up in the wrong bags for different orders, he added.
“The benefits of that batch-zone pick process are really about throughput and volume. If I’m only doing a few orders an hour, the amount of orders that might have items in common gets lower and lower,” Demko said.
While efficient, batch picking isn’t always the speediest option and can potentially slow down rapid delivery service for one-hour or faster orders, he said.
Demko said it’s important that the mobile application used by the pickers is easy to use and aligns with visual cues in the cart, like knowing which customer’s bags are where, and that the software works for all of the areas where picking takes place, from the sales floor to the backroom to designated “fast pick” areas.
Grocers can leverage data from picking solutions to measure and analyze factors like productivity levels and order accuracy and then look for ways to become even more efficient, he said.
‘Imagine you’re picking for your grandmother’
While technology may speed up the picking process, working fast can run the risk of making quality-control mistakes. That’s where training comes in: “At the end of the day, technology is only as good as the people who use it,” Demko said.
Quality control, which is included in worker training, can play a big role in customer satisfaction and cut down on order returns, sources noted. While technology and store design can help people find the pick the correct brand of avocado quickly, the picker ultimately decides which products meet the customer’s expectation for ripeness and quality.
When Demko ran operations at FreshDirect, he said the training mindset there was: “Imagine you’re picking for your grandmother.”
“You’ve got to get that quality mindset, which is: When you pick up that leaf of that head of lettuce, look at it and make sure there isn’t a leaf wilting on it … make sure you’re opening up the eggs and make sure there’s nothing broken,” he said.
Consumers have been especially reluctant to trust workers to pick fresh produce, meat and other perishables for them, making trust and quality control important to the picking process.
Store employees who pick online orders can also help manage shrink by setting aside products they identify as spoiled or not high quality, Demko said.
Shipt, which promotes the high-touch service provided by its personal shoppers as a key differentiator in the e-commerce delivery race, provides an “education produce guide” for its Shipt Shopper community. The guide covers three main areas: sight, smell and storage, according to a post from the company in late March.
For example, Shipt encourages its shoppers to look for signs of dehydration, like wrinkling and shriveling, to help gauge freshness and to squeeze items like grapes and melons to determine the firmness.
“[A] great tip for picking out grapes is taking a look at the vine. Green vines mean the grape was freshly picked and handled properly in transport,” Shipt said in the blog.
SpartanNash workers receive training in a variety of areas for order picking, like bagging 101, how to understand expiration dates, and how to determine the quality and ripeness of produce. The training, which was developed in-house and is required for all of the company’s personal shoppers, also delves into skills like identifying produce and the right types of meat.
SpartanNash puts a “huge” emphasis on training to make its employees the “eyes and ears of the customer” and ensure customer satisfaction, Van Gilder said.
Both Shipt and SpartanNash are leaning heavily into worker training, aiming to have top-notch service fuel attachments between customers and specific pickers and help lock in customer loyalty.
“We’re training our personal shoppers to be pickier than the customers who shop themselves,” Van Gilder said.