Convenience stores need to automate or get left behind
A convenience store’s main competition was simply another c-store until relatively recently. That’s changed, however, as quick commerce businesses have made aggressive moves into the convenience space, promising delivery of small baskets within as little as 10 minutes.
Convenience retailers looking to stay relevant must improve, streamline and automate in-store operations to elevate the customer experience.
C-stores have unique challenges related to their small footprint and high cost per square foot. They must balance high availability with the ever-present risk of waste and lack of backroom space to hold safety stock. They also need to ensure that their customers can find exactly what they want and quickly make a purchase.
Space and inventory management are equally important for c-store staff.
Stores have a limited number of associates available to handle all essential tasks, such as stocking shelves (including fresh items) and keeping aisles free of clutter, while also checking out customers.
Store-level planograms, which are difficult to create manually, are highly valuable to guide staff in maximizing existing space and optimizing replenishment schedules.
Shipments to replenish existing items, stock new products or support short-term promotions must arrive on an as-needed basis and be ready to go direct-to-shelf.
C-stores must move toward a technologically advanced, unified system that uses a single source of data to inform decisions about operational tasks to stay competitive in a rapidly changing landscape where there are so many moving parts to supply chain management. They also need a system to automate these decisions, from replenishment orders to staff scheduling to space planning and further streamline store operations to ensure quality customer service.
Will brick-and-mortar convenience stores, five years from now, be replaced by delivery services? It’s unlikely. Yet, without striking a careful balance between protecting margins and maximizing the shopping experience, c-stores stand to lose in-store customers who would rather pay a bit extra to have their basket come to them, taking a hit to their top and bottom lines.
DISCUSSION QUESTIONS: How can c-store retailers stay competitive with the new series of fast commerce operators as well as traditional rivals? What technology investments do you think hold the greatest potential for generating positive results for c-stores at this point in time?