The Date Check Pro Blog

Using The Dot System To Reduce Expired Products & Shrink

By Andrew Hoeft


dot system for expired products

Managing expired products is a pain. With the average grocery store carrying 40,000 different SKUs, it is nearly impossible to prevent having expired products on your shelves. But what can you do today to do a better job?

Today, many supermarkets have abandoned rotating when stocking center-store products in favor of a spot-checking schedule. Using this method, items are checked by section or aisle according to a scheduled cycle. This transition makes complete sense in terms of labor hours. As grocery stores carry more and more products and sell through them faster and faster, the time to rotate every item every time you stock adds up quickly. Spot-checking requires far less labor time, but it is not a very proactive method of preventing expired products.

When I worked for a grocery store, it was my job to maintain a spot-checking schedule. The company I worked for followed an 8-week schedule to check every non-HABA (health and beauty aids) item. Any product that was within 10-days of expiring was pulled off the shelf, but what did we do when I found a product that was four to six weeks away from expiring?

The answer is simple: nothing. Which was a problem.

Most of the time the grocery managers assumed we would sell through the product before the four or six weeks were up. So nothing was ever done. The problem is that our stockers were not rotating when stocking. That meant that over the next few days, it was highly likely that the product about to expire was going to be pushed to the back of the shelf with newer product placed in front of it. The result = a bunch of expired products.

So what can you do?

A very quick and easy solution is to implement a dot system. Every time your spot-checkers find a SKU with product close to expiring (you can set the actual timeframe), place a small dot sticker next to the price tag. Then, train your stockers that items with a dot sticker mean the product needs to be rotated. Better yet, train your stockers to actually look at the dates on SKUs with a dot sticker. That way as the product gets closer and closer to expiring, the price can be reduced to incentivize a quick sale. The stockers or spot-checkers can then either pull off these stickers after finding the close-dated product has sold through.

Keep in mind; the dot system is still only a step in the right direction to effectively managing all the expired products in your store. Many times a spot-checker finds a large amount of product on the shelf for which it is too late for the dot system to make a difference. For more info on how many expired products the average grocery store has on the shelves today, check out our latest info-graphic and look at the “Rotation Results” section.

Expired Food: The Monumental Task Of Managing It

By Cody Sheehy


Expired food: 3 year old cream cheeseKeeping store shelves free of expired food can be a much more difficult task than it appears on the surface.  If you have ever picked up an item on the shelf that is a few months past the expiration date, you might find yourself wondering how that is possible.  However, when you take a step back and look at the whole store, it isn’t that surprising.

Many grocery stores are carrying 30,000 to 40,000 items that constantly need to be restocked.  The center store grocery department will usually have anywhere from 3,000 items to up over 10,000 items depending on the size of the store.  In a larger store, there can easily be 15,000 different items that have an expiration date on them.  That is 15,000 different SKUs, and they each likely have 10 or more products sitting on the shelf.  Now, you all of a sudden have at least 150,000 individual products (15,000 SKUs x 10 items per SKU) with an expiration date to be concerned about.  If you were to go through an entire store that had exactly 150,000 products to check the date on, taking six seconds per item, it would take you 250 hours.  However, the problem with that estimate is threefold.

First, there are likely even more than 150,000 products that you would need to check.  While some bigger items (like cereal) will have only 4 or 5 products on the shelf, others will have 30 or more.  Second, six seconds is easy when you’re checking the items on the front of the shelf, but it takes much longer to reach items at the back of the shelf.  The reality is that 250 hours to sweep the store one time is a very optimistic estimate.

The last thing that needs to be considered is the fact that this type of sweep would need to be done constantly, because new items are going to wind up expired every day.  No matter how good someone is at rotation, there will simply be items that do not sell and end up expiring.

Even if you were to complete this task on a monthly basis, you would need more than one full time employee, 160 hours, to do it.  You would also still be running the risk of food expiring on the shelf in that month between when products got checked.

Unless you can target your hours by using a software solution like Date Check Pro, the reality is that a grocery store cannot invest enough time in checking for expired food.  The situation is a double edged sword, because it would drive prices up to cover the additional labor costs. High prices would drive customers away just like purchasing expired food.

Infographic: Shrink and Expired Products

By Alyssa Harings


On average $61,000 are lost to expired products in each grocery store per year.

Date Check Pro has done a combination of compiling existing research, and collecting some of our own to put together the featured infographic to show how expired products really do affect shrink and a grocery store’s bottom line.  The good news is all of these losses can be avoided.  The first step is simply knowing when products are going to expire ahead of time so the grocer can actually sell the product, not just take it off the shelf after it has gone out of code.

Infographic: Click to make larger.

The true cost of expired products

Visit our Demo page and start winning the battle against expired products today.

What should we do with the leftovers of over production?

By Alyssa Harings


As children grocery shopping with mom or dad, we all would take a gander at the cakes as our parents strolled through the bakery department.  A lot of the cakes had room for customization for birthdays, anniversaries, retirements, etc.  But what happened to the cakes if the name John wasn’t supposed to have the ‘h’ in it?  Does it simply get thrown away?  We were curious to find out, so we decided to do our own study.

We asked the question, “What do grocers do with over-produced or incorrectly-produced items in their grocery store?”  By over-produced we mean the store made too much product to sell (of products they make in the store like at the deli or in the bakery).  By incorrectly-produced we mean they produced an item for a customer, but it wasn’t exactly what the customer wanted (the cake in the above example).  Our prediction was the grocers do one of three things: (1) they throw away the unneeded product, (2) they let employees have the unneeded product, or (3) they donated the unneeded product to charity.  We were especially curious about numbers 1 and 2.  We wondered if grocers throw away the unneeded items because they were trying to prevent the practice of employees purposely over or incorrectly producing these items in hopes of being able to have it.  Our hypothesis was that they do throw it out for this reason.

So we started calling grocery stores!  We took a random sample of 90 grocery stores across the United States expecting 35 of the stores to participate.  Well, we got 28 of them to participate and here is what we found:

over-production-chart

The categories Throw, Give to Employees, Donate, and Reclamation refer to grocers that said they only do one of these things.  So by looking at this chart, someone could think that only a small amount of grocers let their employees have the over-produced or incorrectly-produced product, but this is not the case.  More grocers do let their employees have the product; it’s just not the only way they deal with the issue.  As you can see, most grocers use a combination of methods to handle this.

Some of the combinations included throwing away the product and giving it to employees, but most of the grocers used a combination of donating and recycling (reusing the food to resell).  For example if there was a misspelling on a cake, a store could sell it by the piece and still make money.  Another way to recycle is use meat and produce that is still good from the deli department in the hot food recipes the next day.  Basically, grocery stores have found a way to make this issue less of an issue.  They are able to still make money off of product that could potentially cost them a lot of money, but they also have a charitable side and donate when they can.

Only three stores said they do not give the product to their employees to prevent intentional over production.  We thought this number would be higher, but our hypothesis was wrong.  Aside from the three stores that did throw it for this reason, the sampled grocery stores only throw away product that is expired and no longer good.  Everything that can be reused is marked down, reused in store, or given to employees or charity – Which is something an industry can be proud of.

Request your copy of the formal whitepaper:

 

Going Green At The Grocery Store

By Andrew Hoeft


 

Last week we celebrated Earth Day. We couldn’t be more proud of the students here in our home town of Whitewater that participated in various Earth Day activities, especially the students in Collegiate Entrepreneurs Organization who planted thousands of trees around town and on campus through their new business, Treenewal.

We wanted to contribute by sharing 7 ways to go green at the grocery store. Not just one day a year, but every day.

  • Reusable & Digital Coupons
    • You will notice some stores now have their coupons available right in the store. This is not only offered as a convenience, but these coupons can actually be used over and over again throughout the week. I used to work at Festival Foods, a grocer that has offered reusable coupons for many years now. It was always a pleasure to tell customers, “You don’t have to rip those coupons out, I can just enter them all for you.” By not ripping the coupons out, we could put those same coupon sheets right back where they came from for the next customer to use. Since we are a software company, we can’t help but to also mention digital coupons. No paper, no waste! Festival and other grocers now list their weekly coupons right on your phone through their own mobile apps.
  • Reuse Grocery Bags
    • These sturdy cloth bags are available at almost every grocery store, or online and can be used over and over again. They also tend to be bigger than normal grocery bags, saving you trips back and forth from your car to your kitchen. If you don’t want to spend the money on reusable bags, just bring your plastic and paper bags back with you next time you go shopping. Your local grocer may even give you an added bonus of a few cents off your order for each bag you bring back!
  • Plastic Bag Crafts
    • Do you have a mountain of plastic bags at home that only seems to get bigger? Make a craft(s) with them! I have seen plastic bag mats, and wallets. Festival Foods even features a plastic bag bench for two at their Green Bay West store. For some craft ideas and step-by-step instructions, check out this Pinterest page all about plastic bag crafts.
  • Recycle Plastic Bags
    • If you’re not feeling artsy. Look for plastic-bag-collection totes at your local grocery store. Bring your mountain of plastic bags from home and put it in one of these bins. They will take care of properly recycling them.
  • Shop Locally Grown & Produced
    • Since they aren’t coming from across the country or even the next state over, fuel is saved by cutting down transportation.
  • Pass On The Produce Bags

    • You don’t really need them anyways right? Just wash them before you eat them. If you are a germ-a-phobe like myself, combine different items into the same bag instead of bagging each item individually.
  • Skip The Snack Packs
    • I am the first to admit it is super convenient to grab the snack pack and throw it in with your lunch for the day. Think of all the paper and plastic we are wasting though! An alternative is to buy the regular packs of your favorite snack and throw some in a washable container that can be used again instead of thrown away.

 

Click here to learn more about ways Festival Foods is going green every day!

Click here to learn more about how student member of CEO are going green and building their business, Treenewal, at the same time!

 

Did we forget something, or want to share how you are going green at the grocery store? Comment below!

Out Of Stock Costs Made Easy: Part 2 – “Top 300″

By Andrew Hoeft


Should all out of stock products be treated the same? The simple answer is no. Data shows that the fastest moving 2% of products offered in a store represent 15% of the total lost sales from stock outs. It makes complete sense too. If you run out of mincemeat in the middle of the summer, the lost sales is at most one or two cans. However, if you run out of something like eggs or milk, or even a popular cereal, lost sales could be cases of product.

Chart from the 2010 "Comprehensive Guide to Retail Out Of Stock Reduction" published by GMA, FMI, & NACDS.

So what can you do?

We would like to introduce our “300 Plan.” While we wish we named the plan after the heroic soldiers from Sparta; 300 is actually 2% of the products carried in a store with 15,000 line items. This simple three step plan focuses your stores time and effort on preventing, or at least reducing, the number of times each of these top demand products is out of stock.

Step 1: Create a “Top 300″ NEVER OUT backstock.

  • The extra space required in your back room is space well allocated. Even worse than having a shelf out of stock is being completely out of stock on a fast-moving product. Use the backstock to fill the shelves when needed, and then reorder based on the backstock inventory, not the inventory on the store-front shelves.

Step 2: Place priority of stocking time on OOS & Low Stock “Top 300″ items.

  • Your stocker’s time is limited. They are not only worried about stocking, but assisting customers to find items, or bringing something a customer forgot to the register for them. By placing an emphasis on the time remaining on the Top 300 items, these products should rarely actually go out of stock.

Step 3: Identify “Top 300″ items on the shelf.

  • Most employees can probably make some good guesses at which products sell the most. But do they actually know them all? Rather than make your staff memorize a list of 300 different products, identify them on the shelf with a sticker or different colored price tag. Something that stands out. That way any employee walking the aisles can quickly see if any of your constant demand items are running low or are completely out of stock.

That’s it. Not too bad right? Even so, if a “Top 300″ plan seems like too much work, at least try a “Top 200″ or “Top 100″ plan. See how things go, and then maybe work your way up to 300 items.

 

Remember, this is step 2. If you haven’t read step 1 on reducing your full store out of stock rate by carrying more product, and not rotating when stocking, you can read it by clicking here.

Also, click here to view the “Comprehensive Guide to Retail Out-of-Stock Reduction In the Fast-Moving Consumer Goods Industry” report published by GMA, FMI, & NACDS. The chart above comes from this valuable report.

Out of Stock Costs Made Easy: Part 1

By Alyssa Harings


So you really like a specific brand and type of toothpaste because it whitens your teeth and makes your mouth feel perfectly fresh. Any other brand or even other toothpaste by the same brand just isn’t good enough. When you go down the health and beauty aisle to find the store is out of your brand of toothpaste what do you do?  You can either settle for a different brand and be disappointed every time you are stuck brushing your teeth with this unwanted toothpaste, or you can go to another store. We know what consumers think about out of stock products, but let’s take a look at what they cost the retailer.

Out of stock products can cost you customers.

While it’s a good thing a store is selling a lot of product, it’s never a good thing to run out of something customers are looking for. Put simply, out of stock occurrences lead to lost sales. We commonly hear grocers say that it’s not a big deal if a product is out of stock because the customer will just buy a different size of the product or a similar product. While it is true that there are many substitute options for when our favorite toothpaste is out of stock, data shows that 40% of the time a customer will not even buy a similar product. Even worse, 30% of the time, the customer will buy the product at a competitor’s store instead.

Sometimes, though, a customer wonders if your store might have some of the out of stock toothpaste in back stock.  When this happens, the customer asks a store employee to see if this is true.  Checking to see if there is any more of that brand of toothpaste anywhere else in the store entails the employee going to the shelf in the store where the item is out of stock to get the UPC.  Then that employee must check on the store’s computer system to see if there is any of that type of toothpaste left in the store.  After finding out that there is not, the employee will probably check to see when the store expects to receive more.  All of this just to tell the customer it will be a few days before he/she will be able to purchase the toothpaste.  In summary, you could have been paying your employee to do his/her regular tasks instead of looking for toothpaste that wasn’t even in the store.  You didn’t get the sale, and every other task got put on hold.  In fact, the time employees spend trying to help customers find out of stock products costs grocer between $200-$800 per week!

As you can see, out of stock products are a serious issue. While there are many initiatives taking place already in the industry to reduce the frequency and costs of out of stock products, we want to point out what we believe to be the easiest and most effective first step.

One major contributor to out of stock products comes from ordering practices. Stores that are focused on rotating product when stocking are likely to let product inventory run extremely low or even completely out before ordering product. This makes rotating while stocking very easy since there are only a few items left on the shelf to rotate. However, the ease is coming at a cost of out of stock products. When all things are considered from the data we just mentioned, this ordering practice is certainly a mistake.

Now this may come as a shock, but we actually recommend that you DO NOT rotate product when stocking. By not having to rotate, you are free to order to keep the shelves full instead of ordering to keep the shelves from running out of product. Many of the larger grocers that we talk with that aren’t quite big enough to have an auto-replenishment system do not rotate. That is because an out of stock product is likely to be one of your 20% highest movers. That means that one of the select products contributing to 80% of your total sales is not available for sale. Multiply that by a few of them being out of stock and over time the result is a tremendous hit to the bottom line. Not only will having these products fully stocked reduce your loss from out of stock products, but also your labor cost of stocking will be dramatically cut from not having to rotate.

We recognize that this does cause an issue of expired product arising in the store. However, the cost of expired goods in a store is much less than the cost of out of stock products. Even better, that’s what we are here for: to make sure that you don’t have expired products in the store. Keep your shelves full, customers happy, and let us worry about expiration dates.

Remember, this is Step 1. Make sure to check out our upcoming blog post on our 300 Plan to further improve your store’s out of stock performance.

 

Also, click here to view the “Comprehensive Guide to Retail Out-of-Stock Reduction In the Fast-Moving Consumer Goods Industry” report published by GMA, FMI, & NACDS.

Date Check Pro’s 2012 Baking Photo Contest Winner

By Alyssa Harings


The winner of our 2012 Baking Photo Contest is Ali Murphy!  

Doesn’t this mini apple pie look delicious? Not to mention, the photo itself looks great!  She really went the extra mile to “plate” the dessert. All we can ask is, when do we get some?

Thank you for participating, Ali, and congratulations on your win!


Participants had the week of Christmas to post a photo of the goodies they had made for the holidays to our Facebook page.  If you would still like to share, we would love to see them!  We look forward to seeing what you make next year as well.

Below are photos of treats made by a couple of Date Check Pro employees.  We hope you all had a Merry Christmas, and we wish you a Happy New Year!

 

 

Date Check Pro Moves

By Alyssa Harings


Things have been busy here at Date Check Pro.  Our company is really starting to expand and that includes new employees.  Among these new faces is Chris who will be helping with the sales side of business, while we have student interns working with marketing and social media.  As you can probably imagine, we all need a space to work.  Although we are a little sad to be leaving the UW-Whitewater Innovation Center, we are happy to announce we have a brand new office!

The 1800 square foot space is located in the heart of downtown Whitewater (which we think it’s pretty cool to be the only software development company in the city).  CEO and founder of Date Check Pro, Andrew Hoeft has been working hard the past few weeks to transform the first floor, empty warehouse into a modern and welcoming office space.  Andrew says, “Having an office of our own is an exciting step for the company. It gives us space to continue working to improve Date Check Pro as well as offers extra room as our company continues to grow.”  Our new office features a 21-foot whiteboard wall (well, actually it’s light blue), comfy couches, and bean bag chairs.  Did we mention we have a custom bag toss too?  Although we think it’s important to work hard, we also like to have our fun!  The new office also has a “no street shoes” policy.  Yes, we have a pair of shoes just for the office as this will help us keep it clean in the winter and spring months, but also keep us cozy.

When you first walk into the front door you may be surprised to see no art on our walls, but we promise this place is not boring.  The walls are colorful enough to make you not miss the paintings you might normally see in an office space.  Instead, you are welcomed by a very modern looking office space with the pipes and electrical conduit still exposed. It is a true start-up office space.

We look forward to continuing to grow our company, including the hiring of new employees in 2013.  We couldn’t be more pleased to have this new space for them to join us in, and you can imagine how excited we are to be working in it.  So, the next time you’re in downtown Whitewater, please stop by to say hi and check out our company’s new home!

It’s Not Just Your Average Grocery List App!

By Andrew Hoeft


AnyList is a new & improved grocery list app!

A grocery list, nah, AnyList!

These days there is an app for just about anything, and this includes grocery shopping.  One that we would like to share is AnyList, an app that lets the user share and update grocery lists with other AnyList users.  In addition, this app allows the user to look up a recipe and add the needed items to his or her grocery list.

Since the app is collaborative, it can be updated by one user, and the update is readily available to another user.  Take this for example: a mother goes to the store with her grocery list on her phone.  If her son also has the same app on his phone, he can look at his mother’s grocery list and add anything she might have forgotten.  So can Dad and anyone else in the family using the app.  This would prevent the, “Mom you forgot (insert kid’s favorite snack here)” greeting when she gets home from the store.  Now back in mom’s shoes, there is no more worrying about what she needs to make dinner tonight by pulling up the recipe, and adding anything she still needs to her grocery list with the tap of a finger. In general, an app like this would make grocery shopping less of a task.

While many grocer’s already offer apps of their own that include a grocery list, AnyList’s unique collaborative list is still a must add! Consumers are using apps to help with their everyday needs more and more and the better your store’s app, the happier your customers will be. We don’t know if AnyList is looking to partner with grocers to use their list within a grocery store’s existing app or not, but that is a conversation we recommend having.

We won’t just leave that recommendation up to us though; we would also like to hear from you, the reader. What do you think? Would this app make your grocery shopping easier? Would you want to see it included in your local grocery stores’ app?

You can also click here to download AnyLists app.