In competing with larger chain operators, independent grocers have certain advantages at the store level such as deep roots in the community, friendly service and an understanding of their customer base that chains may find hard to duplicate.
But on the Internet, where technology rules, and a warm smile doesn't necessarily translate, independents can be at a distinct disadvantage, lacking the savvy and resources of larger operators. Many small retailers just resort to static Web pages without interactivity. But that's where Unified Grocers, the Los Angeles-based member-owned cooperative wholesaler, saw an opportunity.
In January, Unified launched a retailer website program called U-Web with Webstop, Palm Harbor, Fla., that offers its independents the chance to operate a digitally sophisticated website with a host of interactive features. The program puts Unified's retailers at least on a par with such regional chains as Price Chopper, Tops Friendly Markets and Harp's Food Stores, which also use the Webstop-hosted technology.
“There's less readership of newspaper circulars, which are expensive to produce and mail,” said Dan Murphy, Unified's senior vice president for perishables and retail services who is responsible for the U-Web initiative. “So we wanted to address the digital consumer and give retailers the ability to have an affordable and interactive website solution that is customizable and retailer-branded.”
More than 100 stores have signed up so far out of the roughly 1,500 supermarkets that Unified supports, Murphy said, adding that Unified is targeting at least 300 stores for the program. “We're talking to more retailers every day about it.”
Unified offers its independents a host of other technology programs, including an Interactive Ordering System (IOS) for store orders; ULink for pricing and shelf management; UNet, a retail broadband network; Ready-Pay payment systems; and Connected Payment, which removes card data from stores to help with PCI (payment card industry) data security standard compliance.
More recently Unified has begun rolling out a “proof of delivery” system that confirms that the correct pallets were delivered to the right store.
For implementing new website and delivery programs for its retailers and for its robust existing retail technology programs, Unified Grocers has been selected as the winner of SN's 2011 Technology Excellence Award in the wholesaler category.
The U-Web website features available to Unified's independents include an interactive shopping list, the ability to populate the list with items from a weekly circular and a database of more than 6,000 recipes (some tied to ad items), and a Google-maps store locator. Shoppers can also retrieve lists and create a personal recipe book. “Personalized consumer content is the key to making a strong connection to consumers online,” said Murphy. “You can't do that with print.”
Each item in the circular can be broken out into a separate box alongside the circular page. Unified expects to launch a mobile app in June that will enable shoppers to see a store's ad circular on their phone.
The home page supported by Webstop also features five “gliders” — moving panels that each temporarily features a store program that can be clicked for more information.
Retailers in the program can construct email campaigns and newsletters, and have access to customer account information and website and email analytics. They have the ability to maintain their website home page and create custom pages. “Retailers can customize it so it has the look and feel of their stores,” said Murphy.
An example of a Unified independent making use of many of the U-Web features is Granite Falls IGA Market, Granite Falls, Wash. (www.gfiga.com).
Murphy declined to cite the monthly cost of the U-Web program, but said that by spreading the cost across its retail membership Unified has made it affordable for independents.
Murphy said Unified is starting to see retailers in the U-Web program reducing use of traditional print media and redirecting ad budgets to their websites. Some retailers have even stopped using print altogether. “As this program continues to evolve, it will be a more effective way to communicate to consumers, especially younger consumers,” he said. “It can tie consumers to the store more than print ever could.”
On the logistics side of its business, Unified is rolling out a “proof of delivery” system for store deliveries in a process that began five months ago. The system is about to be turned on in Unified's Southern California region, and will then be installed step-wise in its Northern California, Portland, Ore., and Seattle regions, said Gary Herman, Unified's vice president and chief information officer.
Replacing a manual process, the new system employs an electronic manifest of products being delivered to a store on a wireless handheld computer. Pallets are scanned as they are loaded onto a trailer (entering the information into the Retalix Triceps warehouse management system) and then scanned again at the store, thereby confirming that the correct pallets were delivered to the right store. The store can confirm the contents of each pallet at the case level.
“Previously, it was all paper-based and there was nothing to electronically ensure that all the pallets got on the trailer and to the store,” said Herman.
The system also captures an electronic signature at the store signing off on the number of containers — wood pallets, bakery trays and dairy cases — received and returned, which is uploaded into the corporate system.
While accuracy of deliveries under the previous system was “good,” it is now “exceptional,” said Herman. “But the real advantage for us is it gets rid of a manual process and makes it electronic.”
Sales in $ Billions: 3.9
Number of supermarkets supported: about 1,500
Key Tech Initiatives: Retail Website Program, Proof of Delivery System