Kaufland Group: How one of Europe’s Largest Grocers Cuts Waste and Boosts Margins

Posted by Paul Milner on Mar 12, 2018 2:38:03 PM

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– Read the full case study here –

Eighty-eight million tonnes of food is thrown away in the EU[1] and a third of the food[2] in the US. It’s a major problem for society and a big focus for supermarkets. There’s a commercial interest at play too. Because as most supermarkets use paper-based price labels, they’re often not able to spare associates to graduate price changes as a sell by date nears. This often means that ‘flash sale’ markdowns happen late in the day. It’s a blunt approach and not especially effective: it reduces margins, while customers may be wary of buying the goods if they look tired.

There’s a better way to tackle this problem, as the leading international hypermarket chain, Kaufland Group, is showing. Known for the quality of its fresh produce, and the innovative use of technology to improve the customer experience, the grocery giant is rolling out Displaydata’s Electronic Shelf Labels (ESLs), in a project designed to enhance the shopping experience, reduce waste and protect margins.

Read the full story here.

Smart, automated pricing across 1,270 stores

Kaufland Group is installing our three colour, fully graphic ESLs in 1,270 stores across Germany, Poland, Slovakia, Croatia, Czech Republic, Romania and Bulgaria. The eye-catching labels enable Kaufland to draw attention to offers and display a wider range of information to keep consumers informed, engaged and enticed. What’s more, the labels are connected with Kaufland’s existing ERP (Enterprise Resource Planning) system and are centrally managed from head office, using Displaydata’s Dynamic Central software. In each store, wireless communicators facilitate label updates with Kaufland able to make limitless price adjustments, on any shelf, anywhere, in seconds. The network runs over a separate frequency to Wi-Fi, so it’s secure, resilient, and interference-free.

Super-agile pricing. Seriously strong results

Kaufland is seeing a number of benefits.

  • Competitive edge: By deploying its price and promotion strategy with unprecedented speed, simplicity and accuracy, Kaufland is responding faster than ever to market changes and competitor offers. And it can easily graduate markdowns as a sell-by dates near, to incentivise sales, protect margins and reduce waste. Compared to manual, paper-based pricing, this is a game changer.

  • Enhanced customer experience: Customers are now able to see additional product information, alongside prices and promotions while the 100% price accuracy enabled by the ESLs, builds trust, boosts loyalty and protects Kaufland’s reputation. Staff are also freed up from making laborious label changes – a process no one likes – to focus on serving customers, further improving the in-store experience and boosting consumer satisfaction.

  • Reduced costs and increased margins: Productivity and profitability are on the rise. Savings have been made thanks to increased time efficiencies and the costs associated with printing paper labels have been eradicated.

Concluding with his views on the value of our ESLs, Steffen Hartelt, Business Consulting Vertrieb, Kaufland Group, says:

“It’s a common challenge faced by all large retailers – how to make the number of price changes that you want, without tying your staff up all day. Displaydata’s ESLs have transformed the way we run the fruit and vegetable areas of our stores: we can reduce prices in just a few moments, on any shelf, anywhere – all centrally managed. This flexibility allows us to use price reductions more strategically to protect margins and reduce waste. And, our staff are freed up to focus much more time on our customers. The time and cost savings from using Displaydata’s ESLs will deliver a satisfying return on investment in a short time.”

Read the full story here

[1] http://www.businessinsider.com/why-grocery-stores-throw-out-so-much-food-2014-10?IR=T

EU

[2] https://www.theguardian.com/environment/2016/jul/13/action-to-cut-food-waste-gains-momentum-across-europe

Topics: Kaufland, ESL, electronic shelf label

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