Tesco’s new Jack’s store

Tesco has unveiled its new discount chain called Jack’s that aims to tackle the rising threat posed by German rivals Aldi and Lidl.

The first store is in a mothballed former Tesco store in Chatteris, Cambridgeshire.

Another outlet in Immingham, Lincolnshire also opens on Thursday.

Between 10 and 15 stores are planned for new locations, next to existing Tesco stores, and a small number of converted Tesco stores.

Tesco is investing between £20m and £25m in Jack’s, which Mr Lewis described as “very, very modest”.

Although Jack’s is “part of the Tesco family”, Lawrence Harvey, the former Aldi UK executive in charge of Jack’s, said it will not issue or accept Clubcard points. Neither will there be any online operation.

As well as the discounters, Tesco faced being overtaken as the UK’s biggest supermarket chain by a combined Sainsbury’s and Asda.

The £15bn merger will be the subject of an in-depth competition investigation, the Competition and Markets Authority announced on Wednesday.

Mr Lewis said that beyond the initial 15 stores, more could follow, but that was “not a calculation we’re currently making”.

One Jack’s store will be set up next to a larger Tesco supermarket to see how consumers shop.

The Tesco boss said he was not worried about the new chain cannibalising sales from Tesco outlets.

Five will be rebranded Metro stores, which are larger than an Tesco Express but smaller than its supermarkets.

Only two will come from stores mothballed in 2014-15 when Mr Lewis took over as chief executive, while the remainder will be new.

Sedano’s Launching “Robotic Supermarket”

Hispanic grocer Sedano’s Supermarket and e-grocery solution Takeoff Technologies will launch an automated hyperlocal fulfillment center the companies call “the world’s first robotic supermarket.”

This retail technology is expected to launch in the upcoming month, bringing innovative automation and transforming eGrocery economics. Customer orders will be placed via an online app and carried out by Takeoff’s automated Micro-Fulfillment Center, with the support of Sedano’s employees. AI-enabled robots assemble full supermarket orders of up to 60 items in just a few minutes – a fraction of the speed and cost of current manual picking options.

The hyperlocal micro-fulfillment center will serve 14 Sedano’s Supermarkets locations throughout Miami and offer consumers pickup services.

“We are excited to partner with Takeoff at the forefront of this groundbreaking robotics solution,” said Javier Herran, CMO for Sedano’s. “This model gives us the ability to leap into the eGrocery industry, develop a new level of employment opportunities and continue meeting the needs of our valued consumers by offering an affordable and convenient online service.”

Takeoff’s objective is to develop hyperlocal fulfillment centers that have one-eighth the footprint of a typical supermarket thanks to innovative robotics and compact vertical spaces. The company is currently working with five regional and national retail chains in the US and have several sites in development to deploy in 2019.

Takeoff’s Micro Fulfillment Centers are set to be built throughout the U.S., in urban and suburban locations, resulting in convenient and hyperlocal solutions for grocery shoppers nationwide. Retailers can leverage underutilized real estate by turning existing stores into micro distribution centers with Takeoff’s technology.

As Takeoff continues to grow, James McCann (former CEO of Ahold USA) is joining as a member of Takeoff Advisory Board and as an investor. McCann is a prominent and experienced retail executive globally. His experience as the former CEO of multiple global grocery retailers and more recent involvement with startups focused on retail technology will be invaluable as Takeoff further transforms the eGrocery space. Additionally, the company has closed its Series B financing led by Forrestal Capital, taking the total capital raised to $46M.

Source: risnews.com

Are big box retailers going too small with new store concepts?

Before the age of Amazon, “big box” stores were the category killers that created the destination locations to draw the masses. Today, the big retailers are focusing on shrinking stores. The downsizing trend begs the question:  How small is too small?   

Some of the recent trends toward small store footprints include:

  • Walmart is building 3,000 sq. ft. convenience stores called Walmart Fuel Stations.  Walmart has also tested 4,000 sq. ft. Walmart Pickup with Fuel formats. 
  • Target plans to have 130 smaller, urban format stores ranging in size from 20,000 to 40,000 sq. ft. by 2019.
  • IKEA’s typical stores are 300,000 sq. ft. but it’s opening smaller showroom locations – some under 10,000 square feet – in urban centers to reach city dwellers and supports online sales.
  • Nordstrom’s is piloting a 3,000 square feet location that carries no inventory for sale and focuses on service and engagement.
  • Finally, reports arrived last week that Amazon was setting a goal to open 3,000 AmazonGo locations – the first two have been 1,800 sq. ft. and 1,450 sq. ft. – by 2021.

Smaller stores are less expensive to open and fit in more neighborhoods while also more adaptive to customer’s varied omnichannel expectations particularly in the area of click and collect. 

  • Several key factors that make smaller stores possible and potentially more profitable:
  • Virtual shelf technology reduces the need for large inventory in store;
  • Click and collect also enables small stores to offer “unlimited” choices;
  • Convenient local locations foster click and collect customer traffic;
  • Small footprints reduce rents and enable more locations, particularly urban;
  • Small stores enable curating assortments to local consumers tastes and needs.

The most important trend in bricks and mortar retail right now is finding formats to “right size” the store platform to fit customer needs.

Walmart expands test of giant automated grocery kiosk

After a test in Oklahoma City last summer, Walmart is opening a second grocery pickup kiosk at a location in Sherman, Texas that enables customer to pick up orders without having to interact with a store associate.

Under the set up:

  • Orders are placed by customers who shop online or through their mobile browser at walmart.com/grocery;
  • Walmart associates inside the store fill the orders;
  • The orders are organized in bins and placed in the massive kiosk located in the parking lot, which is equipped with refrigerators and freezers for perishable goods.
  • Customers pull up to the kiosk building, walk up to an interface station and scan the barcode they received with their “order ready” e-mail. The kiosk retrieves the order, delivering it to the customer in a process that takes a minute or less.

Customers are not charged extra but must spend at least $30 per order to use the service.

“Not only do customers not have to wait for an associate to bring them their order, but they also never need to set foot inside the store,” a Walmart spokesperson told Business Insider.

The Sherman kiosk, measuring 11-by-127-feet, is able to serve five customers at once, larger than the one in Oklahoma City that’s able to service two at a time.

Walmart has been investing heavily over the last year in a variety of pickup and delivery options. At the end of Q2, Walmart U.S. had more than 1,800 grocery pickup locations, more than 320 stores offering grocery delivery, and more than 325 pickup towers, which focus on general merchandise. Grocery delivery is expected to reach 40 percent of the U.S. population by year-end.

“Grocery pickup wait times continue to come down and our grocery delivery times are improving,” said Walmart CEO Doug McMillon. “We’re continuing to innovate with trials of self-driving cars in Arizona for our grocery pickup customers and automated picking capabilities for grocery pickup in our store in Salem, New Hampshire. Overall, our omni-channel initiatives are contributing to comp sales growth and providing customers with new levels of shopping convenience.”

Tesco could launch discount chain Jack’s next week

After plenty of speculation over a new brand in the works, Tesco is reportedly on the verge of launching its discount chain called Jack’s next week.

Named after Tesco founder Jack Cohen, Jack’s will focus on cut-price products as a clear competitor to Aldi and Lidl.

The first new store will be unveiled by Tesco chief executive Dave Lewis in Chatteris, Cambridgeshire next Wednesday, where journalists have been invited to a mysterious event at its previously shelved site.

Such is the secrecy around the launch that it’s believed Tesco has made staff and suppliers sign a non-disclosure agreement, and has said little officially in terms of its plans.

The news comes after Tesco was seen advertising for workers at new format stores in Wandsworth, Lincolnshire and Cambridgeshire.

One of the job ads for Tesco’s new stores reads: “The new retail format will be operated separately from the core Tesco business and as such benefits offered will be different from those offered at Tesco.”

Speaking to the Guardian, Shore Capital analyst Clive Black said he expected the Jack’s chain to consist of 100 stores, including around 60 of Tesco’s Metro format supermarkets.

It is believed that Tesco Metros in St Helens and Edge Hill, Liverpool are among those likely to be converted to the Jack’s brand.


Amazon Go store slated for New York City

Amazon.com Inc. has set its sights on the Big Apple for one of its cashierless Amazon Go stores.

On Tuesday, Amazon confirmed plans to open an Amazon Go store in New York City. However, the company gave no timetable or details on the store and its location.

News of the planned store had surfaced when published reports said Amazon posted job listings related to an Amazon Go in New York.

Amazon now has five Amazon Go locations opened or in the works. Besides New York, the company has confirmed plans to open the high-tech convenience store concept in Chicago and San Francisco but, again, declined to provide details.

Three Amazon Go stores are already open in Amazon’s hometown of Seattle, and the third location — opening on Sept. 4, only about a week after the second — came as a bit of a surprise to retail industry observers.

The newest Amazon Go, at 300 Boren Ave. N. in Seattle, is the convenience retail banner’s largest so far at 2,100 square feet.

Offered at the store are ready-to-eat breakfast, lunch, dinner and snack options made by the retailer’s chefs as well as favorite local kitchens and bakeries. Customers also will find an assortment of grocery essentials, ranging from staple items like bread and milk to more indulgent fare like artisan cheeses and locally made chocolates.

And in line with the convenience focus, the store stocks an array of chef-designed Amazon Meal Kits, created to provide all the ingredients to prepare a home-cooked dinner for two in about 30 minutes.

As in the other Amazon Go stores, the e-tail giant’s “Just Walk Out” technology enables a checkout-free shopping experience. Shoppers use the Amazon Go mobile app to enter the store. Overhead cameras, weight sensors and deep learning technology detect merchandise that shoppers take from or return to shelves and keep track of the items selected in a virtual cart. When customers leave the store, the Just Walk Out technology automatically debits their Amazon account for the items they take and sends a receipt to the app.

All of the Seattle Amazon Go stores are corner locations. Amazon opened the first Amazon Go, an 1,800-square-foot unit at 7131 7th Avenue, to the public on Jan. 22. A 1,450-square-foot Amazon Go store opened its doors on Aug. 28 at 920 5th Avenue in downtown Seattle.

Source: supermarketnews.com

Amazon opens second, smaller Go store format in Seattle

Amazon has announced plans to open a second Amazon Go convenience store in Seattle. The store will be slightly smaller than its first Amazon Go format — 1,450 square feet rather than 1,800 — and will feature a ready-to-eat breakfast, lunch, dinner and snack products, along with Amazon Meal Kits.

Go store format seems to be checking many of the demands on shopper wishlists: convenience, premium quality and tech-driven experience, to name a few. It remains to be seen, however, how the concept will play beyond the retail giant’s home base of Seattle.

Amazon’s smaller format should appeal to consumers who prefer to make need-based fill-in trips rather than the weekly stock-up visits that have traditionally characterized supermarket shopping, according to Nielsen. The firm finds that globally, 46% of consumers view grocery shopping as a chore and that 10% say they go shopping just for the meal they need on a given day. Large stores will continue to be relevant in specific markets, but the firm noted small stores in high-traffic areas that offer quick in-and-out shopping will continue to grow sales at a faster pace.

Customers also like the convenience of skipping the check-out line, and Amazon Go allows customers to place items in a cart and to be automatically charged — no cashier or self-checkout necessary — with charges reversed if the customer puts items back on the shelf. Similarly, Kroger’s Scan, Bag, Go lets shoppers use their mobile phones or special handheld devices to ring up items as they shop, skipping the front end altogether.

Source fooddive.com


ALDI Wants To Keep It Simple

ALDI’s executives gave a tour of their newly remodeled St. Charles Illinois store which they say represents how they are spending $5.3 billion to remodel their existing 1,800+ stores and open 800 new ones.

Their plan is to use this investment to become the third largest grocer, by store count, with over 2,500 stores by 2022 putting them right behind Walmart and Kroger. Their strategy includes expansion in more suburban middle and upper middle class neighborhoods.

The new format, which is 12,000 square foot, and is 20 percent larger than their previous footprint, has just five aisles with an expanded produce, refrigerated and freezer sections. In fact, the company has expanded fresh food offerings by 40 percent. The company, known for its low prices and award winning private label foods and beverages for the past 40 plus years, seems to have a new focus which is to expand beyond their core price-conscious customer to a much broader, and dare I say, more foodie oriented shopper by touting their award winning wines, their Specially Selected brand of more upscale foods, “fresh never frozen” seafood, organic meats, a Never Any! brand of chicken (that has no antibiotics, hormones, animal by-products, steroids, or salt and are fed a 100% vegetarian diet) and, of course, their Earth Grown kale veggie burgers.

CEO Jason Hart who said that by the end of their 5-year plan, they want to serve 100 million people led the store tour. ALDI is a very close-to-the-vest company, and is privately held. When asked, he would not share specifics on the number of SKUs in the store, how store sales have increased with the new format or it’s daily transactions. Scott Patton and Joan Kavanaugh, both who have the title of VP of Corporate Buying led our small group throughout the store showcasing innovations in fresh, organic, and trendy offerings. Patton used their olive oil offerings as an example of just how they satisfy just about every customer. Ten years ago, they didn’t even carry olive oil. Today they have four. One basic olive oil that is the lowest price, one extra virgin, one organic and their Specially Selected olive oil, which is imported from a specific area in Sicily for the demanding palate.

ALDI’s assortment is made up of approximately 90 percent of their exclusive brands, SimplyNature, Earth Grown, Specially Selected, Never Any!, LiveGFree (gluten free) and little JOURNEY (baby products) which according to their test kitchen director undergoes over 50,000 well controlled tests to insure their recipes and ingredients are strictly adhered to by their suppliers. There is little doubt they are a demanding and strict buyer – but they relish their long-term relationships with suppliers and think of them as partners for the long-term.

Patton shared that their produce section, which by the way is very impressive both in quality and in price, is growing twice as fast as any other category in the store (although he too would share any financial metrics). The department also includes a “Produce Picks” section that has a limited number of items, yesterday the display was all about blueberries and strawberries offered at super low prices. An interesting note is that unlike most grocers, their produce department is located in the back of the store, rather than up front which is a tool most food retailers use to shout “fresh” and set the stage for a more enjoyable shopping trip with a vast array of colors and aromas.

ALDI Finds are 30-50 foods and beverages that are spot buys that they try to time seasonally that are in the store for just about one week, they have another 30-50 products that are household and non-food items that yesterday offered products like carpets and drawers for student dorm rooms as they head back to college.

The ALDI execs reinforced over and over how they “keep it simple.” Simple for the customer by not inundating them with too many choices (after all, Kavanaugh said, does a shopper really need dozens of choices of peanut butters?) and simple for their store and internal operations. When asked why they don’t do in-store sampling the response was that it just adds cost to the system and they “want to keep it simple.”

Source: supermarketguru.com

Grocery e-commerce startup Boxed plans to expand footprint with new funding

Huang told the New York Times that suitors weren’t interested in his company until Amazon purchased Whole Foods last year. That deal quickly increased retailer’s appetite for online shopping and automation — Boxed’s bread and butter — but the Costco competitor hasn’t gotten any convincing takeover offers. This includes a bid from Kroger earlier this year, which valued Boxed at around $400 million.

Now, Boxed has $111 million more to focus on scaling quickly, potentially threatening bulk competitors such as Costco, and perhaps even Amazon and Walmart.

The company has made the most of growing demand for bulk goods online, including snacks and groceries. Boxed also effectively differentiates itself from the likes of Costco, which has expanded its online shopping, with an endearingly quirky approach. This includes slipping handwritten notes into shipments and sending “selfies” of orders to customers when they ship.

Other retailers may benefit, too, as Boxed looks to license its technology. Such an opportunity, which is similar to Kroger’s establishment of Sunrise Technologies in March, could help level the digital playing field against deep-pocketed Amazon as it continues to feel its way in the grocery space.

Helping others could be an especially lucrative opportunity, since companies across retail are looking to upgrade their systems and their store experience, but don’t have the capability in-house. Boxed and Kroger are taking two similar approaches in outsourcing their technologies, but their own models are otherwise not too similar. Boxed sells about 1,600 products, mostly bulk. Huang also expects its business-to-businesscustomer base to surpass its consumer-based business.

Further, Boxed claims to be “one of the very few commerce companies in the world that writes its own software, runs its own fulfillment centers and builds its own automation robotics in-house.” This could provide an advantage over other retailers, including Kroger, as well as Target and Walmart, all of which have recently gobbled up startups to chase the tech savvy and speed of Amazon.

The opportunity is significant for all of these companies developing a brick and click balance. In a recent Forbes interview Huang marveled that a huge driver such as consumer packaged goods accounts for only 1.5% online. Boxed’s opportunity is perhaps even more substantial as the three warehouse club retailers collectively account for $200 billion, yet none of that is coming from mobile, Huang told the Times.

Online grocery sales are expected to double over the next four years, reaching $334 billion by 2022. This trajectory means that retailers need to think beyond their core grocery competencies and start to think of themselves as technology companies as well. Boxed has always done this and may have a bit of a head start here.

Source fooddive.com

A Look at the Customer Experience at Target’s Next-Gen Stores

Target is in the midst of remodeling more than 1,000 of its retail stores across the U.S. to meet growing shopper demand for an evolved customer experience, but no two stores will look alike. However, the retailer has developed a bucket of next-gen features to pull from and one distinctive attribute will remain. Stores with dual entrances will boast one entry point designed around “ease” and the other around “inspiration.” As Target seeks to cater to convenience, “ease” entrances boast Drive Up parking spaces, online Order Pickup counters, self-checkout lanes and grab-and-go grocery and essentials.

The retailer expects to be finished by the end of 2020 and complete more than 300 this year. So far Target has completed 56 remodels in its first quarter of 2018 and has already launched well over 100 more that will be completed in the second quarter. In Q1 Target completed more than double the number of remodels it delivered a year ago and the company continues to see incremental 2% to 4% sales lifts in stores following the completion of a remodel.

Some of Target’s modernized stores will feature a renovated Starbucks near the entrance for convenient coffee grabs. Other changes to the retail experience include brighter lighting and a more modern feel.

“We add concrete floors and wood-plank walls to some stores, incorporate materials like steel and glass and a pop of Target red into the décor, and use pendant and circular lighting treatments with energy-saving LED lights,” said Perdew. “And those are just a few examples—all to create a warm and inviting experience that’s hip and cool.”

Enhanced merchandise displays will create ‘shops’ throughout the store. Some stores will get a center aisle treatment that winds through the middle of the store with displays at varying heights to make them more eye-catching. The beauty department looks more like a specialty shop and in the home department products will be displayed in lifestyle settings to help shoppers imagine what they would look like in their own homes.

In conjunction with the remodels, Target has dedicated hundreds of “thousands of payroll hours” to train employees in specialized roles and develop their expertise to better serve shoppers. Since stores are staying open during the remodel process Contrucci said Target teams are going through special trainings to help keep disruption to a minimum while the work is underway.

Source risnews.com