JULY 28, 2020
CMO of PULSE, the robotics and technology company. Recognized Thought Leader in strategy, retail, e-commerce and micro-fulfillment.
According to research, Americans purchased more than $680 billion in groceries in 2019. In a word, the grocery industry is big business. To meet the demand for groceries in the U.S., retailers operate over 38,000 grocery stores, with Walmart and Kroger among the largest chains.
An interesting dynamic within the grocery industry is the low margins associated with selling groceries. Grocery retailers are also challenged by the growth of online grocery ordering and delivery. Due to Covid-19, grocers experienced a significant increase in orders. That’s the good news. The bad news is that grocers lost money on every online order they fulfilled.
For an industry as critical as grocery retailing, it’s surprising how many grocers continue to operate using a business model that has changed very little over the last 100 years.
The time has come for grocery retailers to transform. The question is how.
Don’t Improve; Reimagine
The biggest challenge facing grocery retailers when it comes to transforming their companies is having the courage to make the decision to begin the process. In my experience providing consulting to the leading grocery retailers globally, including the largest grocery retailer in the world, Kroger, most grocery retailers have a low tolerance for risk.