The fruit and vegetable department is the main source of waste in supermarkets: shrinkage accounts for almost 6%, compared with 1.5% in other departments. At the root of the fruits and vegetables challenge ? The ordering process, due to a number of factors: incorrect stocks, orders placed out of habit, outdated order-taking technology, etc.
In response to this major challenge, Smartway, which supports retailers in the fight against food waste since 2012, is launching the “Fresh Operating System” (FOS), a technological innovation specifically designed for fruits and vegetables departments, which perfects the ordering process. The aim is to digitize processes and enable teams to place “THE PERFECT ORDER”, one that limits both shrinkage and out-of-stocks, by combining accurate data analysis and responsiveness to demand variations.
4 TIMES MORE FOOD WASTE IN FRUITS AND VEGETABLES THAN IN OTHER DEPARTMENTS
Because it embodies the store’s image of freshness, the fruits and vegetables section is eminently strategic. 87% of French people say that the quality and freshness of the range of fruits and vegetables influences their choice of store. For fruits and vegetables sold in bulk, this argument is even as important as price. (OpinionWay-Smartway survey – November 2023).
The need for freshness demanded by customers makes this department of fruits and vegetables really complex to manage. To maintain an optimal appearance, employees regularly renew the products on the shelves. Produce that has lost its freshness is removed, leading to more waste in a sector that is already characterized by an extremely high shrinkage rate around 6%, four times higher than other departments.
It is therefore essential to find the key to optimize the management of fruits and vegetables, to meet consumer expectations in terms of freshness with the need to minimize food waste in this department.
THE ORDERING PROCESS, THE KEY TO EFFECTIVE FRUITS AND VEGETABLES DEPARTMENT MANAGEMENT
There are many reasons explaining this poor performance of food shrinkage. Of course, this is a complex sector: there are various product categories, all perishable and each with their own particularities and methods of preservation at the store. Unlike industrial products in other departments, fruits and vegetables are living products that change throughout the day, leading to a challenging department to manage for employees.
But beyond the nature of the products themselves, there’s another issue to consider, and that’s the ordering process.
Today’s ordering tool is based on real-time stock management and demand forecasts. The problem is that the technology currently used in stores to take orders has not undergone any major changes in recent decades. As a result, demand forecasting systems do not aggregate all the data needed to make the right decisions and still ignore a number of key parameters in fruits and vegetables selection, such as the weather or seasonal variations.
Another problem is that 60 to 75% of the stocks shown in the ERP system are false, due to quick product inspections at the reception in stores, improper consumer handlings, incorrectly flashed shrinkage on a daily basis or due to the natural evolution of fruits and vegetables during the day.
Demand is already difficult to predict so it makes sense to have imperfect orders if the stock is wrong. In today’s stores, orders are often placed by habit or instinct, using pencil and paper or a spreadsheet, or relying on the filling-rate of the shelves, without checking that stocks are correct. This often leads to unnecessary shrinkage through over-ordering, or conversely to stock-outs, directly affecting the economic performance of the department.
SMARTWAY, THE FOOD WASTE EXPERT, REINVENTS THE FRUIT AND VEGETABLE ORDER
Smartway has been helping retailers to tackle food waste for 12 years. More than 2,000 stores worldwide have already adopted its Food Waste Management System, solutions based on an unique artificial intelligence that guide in-store teams to detect products approaching their use-by date and decide on the best way to revalue them: labeling them with a relevant discount or simplified donation to charities.
By 2022, Smartway had saved more than 250 million products from the trash.
Convinced that the fight against food waste can go further, Smartway is innovating once again by launching the “Fresh Operating System” (FOS), a major revolution specifically designed for fruits and vegetables departments that perfects the ordering process. It enables stores to forecast demand, make more reliable stocks and simplify the ordering process, directly in the shop in front of the shelves. The result is optimum quality and filling-rates.
Thanks to Smartway technology based on Artificial Intelligence, employees can be guided through the order-taking process based on data such as sales history, weather forecasts and forecast demand. This digital tool is adapted to their on-shelf constraints and can be used on the move, so that they can adjust their orders in real time. As a result, stock-outs and shrinkage are reduced and the store benefits from additional sales. The figures are impressive: a 3% increase in sales, a 25% reduction in shrinkage and fewer out-of-stocks.
SMARTWAY, SUPPORTING CHANGE IN THE FRUITS & VEGETABLES SECTOR
For a retailer, orchestrating a nationwide transformation is a complex challenge, requiring a well thought-out strategy and methodical implementation. To this end, Smartway is committed to a personalized approach to business operations. The objective is to support the company in rapidly and effectively transforming its business processes, and to enable every employee in the fruits and vegetables sector to intuitively integrate technology into their daily tasks.
In this way, roll-out projects can be completed quickly (less than 4 months for 300 stores in the same chain), and aligned with the retailer’s roadmap for immediate operational improvements and measurable gains in profitability.
Smartway’s influence goes far beyond reducing food waste and optimizing processes. As a catalyst for change, the company is reinventing the store experience by creating a positive impact on all aspects of the fruits and vegetables supply chain.
“At Smartway, we are convinced that it is essential to deal with all stages of the purchasing process to tackle food waste. Particularly upstream, before the product even reaches the shelves.
We are also convinced that retailers can benefit from a better management of non-gencoded products, particularly fruits and vegetables, which are the main source of waste in supermarkets. That is why we have developed the Fresh Operating System, which adds another link to the fight against food waste.”
Paul Adrien and Christophe Menez, co-founders of Smartway
PRESS CONTACT
Agence Presse & Cie
Laetitia Munoz
06 20 49 90 39
lmunoz@presse-cie.com
iloveretail.fr
Mike Hadjadj
06 27 30 52 08
mike@iloveretail.fr
About Smartway
Food stores throw away as much as they earn! We can no longer tolerate such waste as more and more consumers are needy. But food stores can now tackle this issue while improving their profitability. Smartway is has been a responsible firm since 2012 and was behind ‘zero waste’ shelves. The firm created the first-ever food waste management system to optimise the path of food products at the end of their lifespan. Smartway solutions use a unique form of artificial intelligence to help in-store teams detect soon-to-expire products and decide on the best way to preserve them: labelling them with a suitable discount or donating them to charities in a simplified way.
‘Let’s build a waste-free future together’
smartway.ai