SHAW'S SYSTEM SLICES SHRINK, SWEELS SALES

JACK ROBERTIELLO

EAST BRIDGEWATER, Mass. -- Officials at Shaw's Supermarkets here say a bakery-control program has worked so well in 49 of their in-store bakeries that they'll introduce the system into all their bakeries by this summer.

The supermarket chain says the system, developed by the retailer in concert with Sapient Corp., an information systems firm in Cambridge, Mass., has allowed it to reduce product shrink and improve sales significantly.

"It's been a positive experience," said Shaw's spokesman Bernie Rogan. "We've achieved reduction of shrink from the very outset of the program. The mere fact that we're rolling it out as quickly as we are should be indicative of that to anyone who's looking at it closely."

Introduced in September 1996, the system -- called automated bakery production, or ABP -- turns pre-existing information from previous years about sales trends, product popularity, seasonal and weather-related buying trends, and holiday and special event sales spikes into daily computer directions for in-store bakery managers.

"With the growing number of items baked in the bakery, it was a place in need of efficiencies," said Rogan.

Previously, recipes, inventories and scheduling information were likely to be kept in three-ring notebooks that were underused and inefficient, the Shaw's official said.

The bakery manager now starts the day by referring to the touch-screen computer system installed in each bakery for the department's baking schedule, ingredient quantity and portion size, how many of each specific item to bake that day, proportions used in the recipes, as well as inventory and scheduling information.

"It's the modern 'Betty Crocker Cook Book' for the bakery department," Rogan said.

The system also houses supply delivery records and inventory, and can be adjusted if the department is short-staffed.

The system also functions as a bakery retrainer.

"One of the things that Shaw's has found as a business driver, besides sales and shrink, was consistency," said Craig Kauffman, vice president of delivery for Sapient.

"They might go to their Peabody store to find the blueberry muffins were baked a little differently than in their Stoneham store," Kauffman explained.

The ABP now includes photos of what each finished product should resemble; and how products should be displayed, allowing the company to control product upgrades or changes better, by sending out new recipes electronically and eliminating old versions, Kauffman said.

Shaw's had first integrated the system into its new format store, introduced in the last 18 months. The format has a much larger bakery, which is now being implemented in all stores, Rogan said.

With European carts and trays in the in-store bakery department, the new format is easier to fine-tune in response to information that the ABP yields.

In some stores, the system unearthed information that encouraged the in-store bakery's reconfiguration.

"We were finding the layout accounted for a lot of stales and overage, but when we started to accurately forecast the department, the amount of baked goods stored on shelves was significantly less," said Kauffman.

Fully stocked shelves at all hours may have looked good, he said, but it created large-scale shrink.

Among other recommended changes, said Kauffman, was reducing the self-serve area.

Previously, all baking estimates were performed store-to-store by each manager with his or her own methods, which officials think was the cause of too many stales and throwaways, and not enough accurate sales predictions.

With previous years' sales data already available, the system configures the production estimates in a way that enables the department managers to achieve better results, Rogan said.

"Sales drive this. The information obtained from those sales drives it. It should be no revelation that more Italian bread may be purchased on any one day of the week rather than another," he commented.

In addition, the system could be applied to any other fresh department, the two officials said, which is probably why Sapient is in the midst of trying to sell other retailers -- ones that Shaw's does not compete with -- on introducing the program themselves.

Shaw's retains a financial interest in the program.

"I think Shaw's sees how this also could apply to butchers, delis and other prepared foods within the supermarket to provide forecasting of scheduling and productions," said Kauffman.