Waste is one of the major problems faced by fresh food retail companies. According to the European Commission, globally approximately a third of all food produced for human consumption is lost or wasted.
According to the U.N. Food and Agriculture Organisation (FAO), reversing this trend would preserve enough food to feed 2 billion people . That’s more than twice the number of undernourished people across the globe.
After collaborating with a number of companies involved in the sale of fresh food products, we at nucleoo have studied how we could curb waste by building a predictive model through data management.
The first thing to consider is the data we require to implement the model:
- Stock entry level per day.
- Daily sales (receipts).
- Product expiration date.
A challenge faced by some companies is the digitisation of this data, however essential for us to make it work.
Once we have collected the data, we will create the Single Source of Truth (SSOT) which ensures that businesses are operating based on standardised, relevant data across all departments in your organisation.
At this point, we are ready to build your predictive model. The model will affect the 4 fundamental retail pillars: Supply chain, Commerce, Store and Finance. In each pillar, we will implement apps, all with the aim to reduce food waste while maximising your financial result.
Supply chain
As part of the Nucleoo model, you will obtain a stock optimiser. Herewith, you will be able to manage stock levels in each of the stores, which will directly affect your ordering system.
Finance
In order to keep track of progress, we will implement a dashboard presenting an overview of the main waste indicators. With these insights, management will better understand how and when adjustments to the process are required.
Commerce
In the commerce section, you will get a promotion recommender, which provides insights about what kind of promotions have worked best in the past. Going forward, you will make promotions in a “controlled” way which will improve your gross profit. For example, you’ll avoid making too aggressive promotions, or completely skip product promotions.
You will also obtain a promotion prize optimiser to help you set the right prices during promotions. Finally, to continuously enrich the previous applications, you will be able to apply A/B testing.
Store
For brick & mortar stores we will implement a layout suggestion application, which will recommend where you should place the products in the store, or which products should be placed together to improve sales. Also, the promotion implementer will inform you in which store you should run promotions in order to maximise performance.
Conclusion
Through Nucleoo’s predictive model, your business will significantly reduce its waste, and be better prepared for the future.
Thanks to data analytics we can better tackle one of the world’s biggest problems.
Are you interested in curbing your waste? Talk to an expert