How to Run a Successful Grocery Store

Running a grocery store begins with putting customers first. 73% of customers agree that their experience at a store influences their buying decision. Some are willing to spend more money if it means being offered quality service. So a happy customer leads to a sales increase, which contributes significantly to the success of a grocery store.

But it doesn’t end at customer satisfaction. Other factors you should consider are inventory management, store layouts, and employee training. It can get overwhelming thinking of it all at once.

Lucky for you, we’ve put together this list of tips for a successful grocery store. They’ll help you identify bottlenecks in your workflow and pain points in your business.

7 tips for a successful grocery store

1. Choose a grocery store layout that works for you.

Your aisles are not just for aesthetic pleasure. The product placements and aisle arrangements on them also matter. This is a strategy big names like Walmart and Aldi are familiar with.

Most grocery stores concentrate discount items on display shelves, which are different in shape and style from the regular aisles. They also carry special or discounted items and are usually at the front or focal point of the store.

The focal point is an area that’s easily noticeable and accessible. Regular aisles in the store are arranged in different layouts such as the Grid, Racetrack, Herringbone, Free-flow, Spine, Diagonal, and Mixed designs.

Illustration of the grid layout in a grocery store
Photo source: consumercredit.com

Grocery stores change their layouts from time to time. This is why your favorite grocery looks and feels unfamiliar sometimes.

Your grocery store layout can bring about an increase in sales if utilized strategically. So it’s essential to put much thought into it. The layout controls customers’ movements around your store, thus encouraging herd behavior. This is when customers move collectively or in similar fashions around the store.

Customers who see others buying certain items may be influenced to do the same, therefore increasing sales.

Before you choose a new store layout, consider the following factors:

  • Draw or design a map of your store to get a visual idea of how to arrange your aisles.
  • Take room measurements to help you determine the size of your shelves and how many aisles you’d need.
  • Monitor customer movement and behavior using store cameras. This will tell you the aisles they visit the most and how to rotate shelves so that low-traffic aisles can get more visibility.
  • Consider your checkout point. For small grocery stores, your cashier should sit at the front. Cashiers in large grocery stores like Walmart can sit at the rear end of the store.

2. Appeal to the sensory experiences of customers

62% of customers shop in physical stores because they’d rather see, feel, and touch products before buying than just ordering online. To convert this population into long-term customers, you will need to practice sensory marketing.

Sensory marketing involves attracting all five of the human senses. That means, from the moment a customer walks in, they should be able to form a connection with your grocery store through sight, hearing, smell, taste, and touch.

To establish good sensory marketing, here are some best practices to follow:

A. Clean up your store appearance.

Store employee sweeping the floor

A dusty entrance door or shelf can easily dissuade customers from staying long. It shows them how much effort you’re putting into improving their experiences (which isn’t a lot). So basic store maintenance is vital for both the exterior and interior parts of your store.

B. Invest in LED lights.

LED ceiling lights

They’re the best type of lighting for grocery stores because they don’t distort how products appear. Under LED lights, customers know that what they’re seeing is exactly how it is. With color lights or fluorescents, products may appear darker or unnatural. Some LED lights also kill bacteria, which is excellent since you deal with consumable and personal care items.

C. Encourage customers to touch products.

Woman grabbing a juice pack from grocery store shelf

Keep products within customers’ reach. That way, the customers can pick up a product, feel the texture or quality, and then make their buying decision. If your shelves are high up and inaccessible, shoppers may be discouraged from buying products.

D. Create your unique smell

Person putting oil drops into air diffuser

When you’re at Starbucks, you know you’re at Starbucks. The smell of coffee in their cafes is usually intense, and that’s part of their sensory marketing strategy. It’s so important that the store decided to cancel serving breakfast. That’s because the smell of cheese and eggs was interfering with their coffee smell.

Before you choose a scent for your store, do this simple exercise:

  1. Imagine your customers’ reactions and how you want them to feel when they walk into the store.
  2. Once you do the above, map out points in your store where you can place these scents.

Avoid scented candles. Not only are they flammable, but they’re not strong enough to give you the kind of coverage you need. Also, avoid air fresheners as they contain harmful chemicals and clog up the nose or throat.

Instead, opt for air diffusers, especially oil diffusers. Diffusers need only water and a few drops of oil to make a room smell pleasant. Also, they’re affordable.

E. Provide tasting samples

Man putting toothpicks in tiny meat slices

Sam’s Club, CostcoWhole Foods Market, and Trader Joe’s are some of the best stores to get free food samples from. You can request to taste a drink or a snack at Whole Foods, and the store employees will open up a sample for you. Other stores like Trader Joe’s have a stand or separate section dedicated to displaying sample products. So you can go there and taste for yourself.

You could even go the extra mile to host sample days when customers can try out varieties of grocery store items. E.g., fresh fruits, local dishes, perfumes, body sprays, etc.

3. Use automated inventory management systems.

Integrating Inventory management systems with your sales channels can help you prevent over and under-stocking. These factors are why businesses lose an estimated $123.4 billion every year.

Using automated software to track how products move in and out of your warehouses will prevent such losses. Immediately a customer places an order in-store or online, the software processes it instantly and generates an invoice from the order.

Every process becomes more manageable from picking, packing, and delivery. Because now you have accurate data to work with. If a product is out of stock, the software reflects this information across all your sales channels. This way, order processing errors are avoided.

Some inventory management software you can use to track your stock include:

4. Create personalized experiences for customers

56% of customers say they want service platforms to display content based on their interests. To make that possible, most businesses in modern times collect personal user data online via web tracking. Based on what they search for on your online sales channels, you can know what to recommend for your customers. That way, they feel seen, which will improve their loyalty to your store.

Best Buy is an example of a store that uses personalization to the max. Any time you go to a Best Buy store near you, open the app. The app will automatically switch to a Local mode. This mode then tailors a shopping experience just for you. You get notifications and recommendations based on products that the store has.

Amazon also follows suit on the personalization train. The online store has Recommenders separated into “Best Sellers”, “Most Viewed”, and “Frequently Bought Together” sections. Whenever you click on a product, the Recommenders show you other products that are closely related to what you’re viewing.

"Customers who viewed this item also viewed" tab on Amazon
Photo source: amazon.com

Here’s how you can offer personalized services to customers:

  • Collect accurate data. You can use software like
  • Create customer profiles for individual customers based on the collected data.
  • Train employees to be resourceful. Let them know how to recommend products, give customers choices, and offer support instead of giving them monotone answers. Teach them to analyze customer behavior and determine the best approach to their moods.
  • Compile self-help resources on your website for customers. E.g., Frequently Asked Questions section, Video walkthroughs on shopping processes, Blogs for information, etc.
  • Connect with and support customers via social media.
  • Don’t just collect customer feedback. Develop a plan to effect changes in line with their suggestions and address complaints to make them feel heard.
  • Combine your brick-and-mortar business with online shopping. Let customers have access to you from multiple channels.
  • Offer mouthwatering deals. E.g., If a customer likes shopping for hot pepper sauce online, send them special coupons for hot pepper sauces via email or texts.

5. Invest in employee training.

Woman in a suit teaching man by writing on white board

 

You can’t be everywhere simultaneously, which is why staff training is essential. Your employees are middlemen between you and customers as they have direct contact with them. Because of this, you’ll want to ensure that they listen to and treat customers well.

While this sounds easy, don’t forget that employees are not robots. They also have emotions, which rude shoppers can easily trigger. When that happens, your employees should know how to handle such situations properly. This ensures that you don’t lose those customers, and you get a second chance to improve their shopping experience.

Training employees is not a day’s work. But with time and dedication, you can teach employees to be resourceful and helpful to customers. Here are some ways to achieve that:

  • Hire only who you need. Emulate Aldi’s strategy. The store’s employees are multitaskers who perform different roles. E.g., Employees can be both cashiers and cart pushers. Occasionally, they can rotate shifts until you can afford more hands on deck. It’ll be easier to train them since you have few staff.
  • Begin the training processes from the orientation and onboarding processes. Present new employees with made-up scenarios and assess their responses. Teach them the proper way to address such scenarios.
  • Create a schedule and timetable for training outside regular work hours and days to train employees. Try not to overwhelm them with information.
  • Group employees into partners and give them assignments. This will acclimate new employees faster to the work environment and help them learn quicker.
  • Invest in quality training materials. While you may not like the idea of spending extra cash, the resources to train employees are worth it. This includes printing employee manuals, recording training videos, etc. You can compile everything into a Retail Learning Management System (LMS), so they can view it all in the same place.
  • Award outstanding employees with rewards. This will motivate others to perform better at their jobs.

6. Partner with third-party logistics companies.

Black poster on a table with "We deliver with Postmates" text on it

Consider partnering with same-day third-party grocery delivery services like Instacart and Shipt. That is until your store is ready to start bearing the weight of deliveries on its own.

The cost of handling customer deliveries can put a strain on your business, especially if you’re just starting. 75% of businesses agree that third-party delivery services significantly reduce those costs.

Third-party grocery delivery services can also help you broaden your reach. According to Tory Gundelach, Senior Vice President of Retail Insights, “the other benefit to retailers is it gives them the ability to deliver to places that would be inefficient or not close to a retail location.”

You wouldn’t need to open store branches all over the city. For example, if you have a few stores, you can partner with services like Instacart. You can integrate your online store with Instacart’s website. This way, customers can order your products through Instacart. After ordering, Instacart drivers will deliver the products to customer addresses. And it’s as simple as that!

7. Leverage top-notch security systems.

Rear view of man wearing green security vest

Theft is inevitable. There are between 330 to 440 million shoplifting cases every year in America. This is why having top-notch security systems in place is necessary.

Stores like Walmart incorporate AI technology. Since Walmart switched to self-checkout stations, Walmart employees now use handheld scanners to track shoplifting. They can see an item on their device whenever you scan it at the counter. So if you cancel the item from your list and bag it with the intention of not paying, Walmart will know.

While not every store, especially new grocery stores, can afford to circulate high-end tech among its employees, here are some steps you can take to protect your grocery store:

  • Install security cameras around the store.
  • Choose a store layout that makes every aisle or section visible to employees and security cameras.
  • Offer curbside pickup or home delivery services. This will reduce the number of customers that shop in-store, thus reducing the chances of theft.
  • Install silent panic buttons in the store. This will minimize the chances of victimization in cases where the store is robbed at gunpoint.

Conclusion

There is no one-size-fits-all strategy to running a grocery store. Every store owner or manager is different. Take your time in reflecting on your vision and goals. This will help you create a business model that aligns with them.

It might tempt you to steal another store’s business model, but that’s only a recipe for disaster. If you’re unsure how to structure your model, you can read our post on Lidl’s business model. You can get inspiration from the store’s strategies.

Overall, be open to change. As time passes, your grocery store will most likely outgrow your business model. You’ll discover that those strategies and processes you once used no longer work for you. That is a sign that you need to choose a new model.


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