Forecasts indicate online grocery sales could capture as much as 20% of total grocery retail by 2025, which indicates plenty of growth opportunity for food retailers in the next few years. But while grocers that offer delivery have increased revenue by 15.8% — 30% higher than pre-launch estimates — it does come at a price: online grocery delivery remains largely unprofitable, with three out of five retailers offering the service losing money on it, according to Incisiv.
As grocers take these short-term hits in search of market share and future growth, they will need to address key issues throughout the supply chain in order to expand their online fulfillment capabilities and further build out a long-term profitability strategy. Top imperatives for grocers include:
- A continued focus on private label foods and goods;
- Synchronization of real-time inventory visibility, throughout the supply chain for both in-store and online channels, and buy-in throughout the organization for data-driven technologies; and
- Making the store an asset to the online grocery experience, and training employees more effectively to address the increasing complexity of store operations tasks.
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