SpartanNash enlists AI-based platform to optimize store operations

In line with companywide efforts to hone execution and act on insights, SpartanNash is expanding its deployment of the Magic inventory and replenishment optimization system from store operations technology specialist Upshop.

Plans call for SpartanNash to use the artificial intelligence-based Magic solution to consolidate ordering systems, maintain planogram integrity, and facilitate the planning of merchandising resets in the center store and produce departments, the Grand Rapids, Michigan-based grocery distributor and retailer said Tuesday. Magic also is expected to give retail associates a broader view of a store’s stock in real time, enabling assortments that better cater to customers and are more in tune with demand, in turn reducing waste.

SpartanNash currently owns and operates 144 supermarkets—mainly under the Family Fare, Martin’s and D&W banners—in Michigan, Nebraska, Indiana, North Dakota, Minnesota, Wisconsin, Iowa, South Dakota and Ohio.

“We’re prioritizing technology to enhance our associate and store guest experience,” Tom Swanson, executive vice president of corporate retail at SpartanNash, said in a statement. “By leveraging advanced analytics to predict product demand, our associates can spend less time checking inventory and more time face-to-face helping serve our shoppers.”

Related:SpartanNash cuts food waste, rings up customer savings with Flashfood

Tampa, Florida-based Upshop noted that Magic is designed specifically for the grocery sector, providing one operations platform for fresh food and center store departments, e-commerce and direct-store delivery. The objective: Bring end-to-end item visibility and labor efficiencies that can hoist sales and cut down on waste. To that end, the solution reviews seasonal trends, promotional activity, allocation of displays and live sales data to yield actionable insights for improving inventory accuracy and shopper satisfaction.

On its website, Upshop said its “total store operations platform” can yield an average sales lift of over 3% and reduce waste more than 35% in fresh; produce 99.5% on-shelf availability and an average shrink savings of 53% in center store; realize a $2.34 labor savings per order and an $8.03 average sales lift in e-commerce; and boost sales by 3% and generate a $75,000-plus gross-margin dollar increase per store.

SpartanNash first partnered with Upshop, formerly known as Applied Data Corp. (ADC), in 2014 in the center store. Earlier this year, SpartanNash leveraged Upshop’s technology to bolster e-commerce fulfillment, including by reducing out-of-stocks, better aligning online and in-store inventory, improving the product substitutions process and speeding customer wait times—for both delivery and pickup service.

Related:SpartanNash goes bigger with ‘Tally’ robot deployment

“Upshop is excited to partner with innovative grocery retailers such as SpartanNash to offer the tools they need to optimize their inventory to meet total store demand,” Upshop CEO Shamus Hines commented. “We’re confident this expanded solution will provide an exceptional shopping experience for store guests by ensuring shelves are always stocked with delicious, fresh options.”

SpartanNash said the wider implementation of Upshop’s platform reflects ongoing investments in technology to drive its merchandising and supply-chain transformations, which the distributor/retailer’s executives have boiled down to an ultimate goal of getting “the right product to the right customer at the right time.”

Two of SpartanNash’s strategic pillars include “elevating execution to win the day” and “acting on insights to optimize customer and product portfolios.” On the merchandising/marketing side, key capabilities that the company aims to accelerate include enhanced category planning, more effective promotions and pricing, simplified yet better assortments, increased use of AI and advanced analytics, and improved loyalty and personalization tools.

Related:Q&A: CEO Tony Sarsam says SpartanNash has set ‘different trajectory for growth’

Besides Upshop, recent tech investments include expanded use of Simbe Robotics’ “Tally” shelf-scanning robot for autonomous inventory management and intelligence as well as a pilot of the AI-powered Afresh predictive ordering and inventory management system at selected stores to hone fresh department operations.

“We’re proud to continue to demonstrate how AI technology can improve operational excellence in our stores and across our business network,” commented Masiar Tayebi, executive vice president and chief strategy and information officer at SpartanNash. “Improving our inventory control and accuracy accelerates the financial benefits we can realize from our merchandising and supply-chain transformations.”

Overall, SpartanNash distributes to all 50 states through its core food wholesaling business, supplying over 2,100 independent grocers nationwide plus corporate-run stores in nine Midwestern states. The company also distributes to 160 military commissaries and over 400 exchanges in the United States and internationally.