IoT could be the key to ending food spoilage in grocery stores

Discussion
Photo: Walmart
Mar 09, 2021
Matthew Stern

Connected devices are emerging as a new way for grocers to reduce losses due to food spoilage and energy waste. With bottom line benefits like these, it’s not surprising to see some of the biggest in the business already putting Internet of Things (IoT) technology to work to improve their operating results.

Walmart has been using IoT tech for such tasks as monitoring food temperature and equipment energy output, according to Talk Business. One IoT application monitors refrigeration units that house products like ice cream frozen and milk cold. It also reports back to a maintenance team if sensors indicate equipment problems so they can be fixed early with minimal downtime and without serious malfunctions. IoT solutions are used so broadly throughout Walmart’s massive store footprint that its connected devices send a total of 1.5 billion messages per day.

Throughout grocery, IoT is being leveraged to improve food safety and reduce excessive energy consumption, according to the World Economic Forum. IoT solutions have allowed food retailers to reduce food loss by 40 percent and experience a net energy savings of 30 percent.

In 2018, it was estimated that grocers were losing on average $70 million per year to food spoilage, with the largest chains losing in the hundreds of millions.

IoT is not the only sustainability-focused technology that large grocers have implemented in recent years.

In 2018 and 2019, there were reports of grocers as prominent as Kroger installing anaerobic digesters in select locations. The machines chemically break down waste, reducing the amount of discarded food that ends up in landfills. While anaerobic digesters do not address the issue of waste created unnecessarily in-store through spoilage, they move grocers closer to the goal of placing zero waste in landfills.

Reducing waste, saving energy and preventing food spoilage are good practices not just for grocery store profitability, but for giving customers the retail experience they want. Before the novel coronavirus pandemic, U.S. customers were increasingly focused on environmental issues and interested in patronizing stores that expressed a strong commitment to sustainability.

Many retailers, brands and municipalities, however, put a pause on sustainability initiatives at the beginning of the pandemic as concerns mounted that some environmentally-minded moves could work at cross-purposes with preventing viral spread.

DISCUSSION QUESTIONS: What are the biggest benefits you see from grocers’ use of IoT solutions? Will these solutions become regular fixtures in grocery or will the upfront investment and learning curve remain too steep for some time?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Over the medium- to long-term, more grocers will invest in IoT innovations to stay competitive. Right now most of them are focused on strengthening e-commerce infrastructure"
"Efficiency is not a valid strategy for long term success — it’s a smart way to improve stores in the near term."
"The concern with statements about Internet of Things (IoT) is that it sounds like a solution in itself, which it is not."

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12 Comments on "IoT could be the key to ending food spoilage in grocery stores"


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David Naumann
BrainTrust

IoT technology to monitor the temperature and performance of refrigerators and freezers in grocery stores has been available for more than 10 years. While the adoption has been slow, it is a great way to manage energy costs and reduce waste. Another great use of IoT in grocery is to tag items with RFID chips that identify when items are close to their expiration date and can trigger markdowns to help avoid waste.

Bob Amster
BrainTrust

Less spoilage. More immediate attention to problems. Better in-stock position. And an unintended consequence will be the ability to monitor the overall performance of the equipment and possibly consider replacing one brand of refrigerator case with another, more reliable manufacturer or model.

Lisa Goller
BrainTrust

IoT solutions can make grocery shopping safer and more efficient and relevant.

Connected stores give grocers greater visibility, which helps to improve food safety, minimize spoilage costs and speed up product recalls. IoT improves the customer experience by protecting product quality, freshness and availability. It can also personalize the brick-and-mortar experience by sending discounts and promotions to shoppers’ smartphones.

Over the medium- to long-term, more grocers will invest in IoT innovations to stay competitive. Right now most of them are focused on strengthening their e-commerce infrastructure.

Brandon Rael
BrainTrust

One of the biggest challenges of running a grocery operation is maintaining the refrigeration units and ensuring that the fresh perishables, dairy, meats, and frozen foods are well maintained and mitigate spoilage and energy waste. Leveraging Internet of Things (IoT) capabilities to do this only scratches the surface of what the IoT technologies are capable of.

There are so many opportunities to leverage these technologies and reignite the sustainability, environmental, and waste reduction initiatives that the emergence of the pandemic may have impacted. By being digitally connected, grocery executives now have the ability to monitor, maintain and optimize their operations. These insights are invaluable and will help mitigate costs while positively impacting the EBITDA and revenue growth.

Doug Garnett
BrainTrust

Efficiency is not a valid strategy for long term success — it’s a smart way to improve stores in the near term. This isn’t to say stores shouldn’t be well run. But the single biggest factor in long term success is ensuring that customers have good reasons to come to your store and good experience while they are there and when they get the goods home.

That means these might be smart efforts. But retailers need to be careful not to fall for the idea that tech efficiencies are their way to success. They might merely be the jacks or better to enter the game. And they might not even be as important as jacks.

Ryan Mathews
BrainTrust

I think we need to separate IoT (as in networked sensors, full stop) and IoT (as in sensor-driven networked devices that operate in a richer digital environment with an AI backbone). Digital sensors are great, and will cut shrink associated with spoilage. But imagine if all the consumer freezers in a trading area were networked into a retailer’s automatic replenishment system via smart refrigerators to a retailer’s ordering system so that the retailer would have a good idea what demand would look like. That’s real IoT to me. Will it happen? Absolutely! The real question is when.

Oliver Guy
BrainTrust
IoT type solutions in retail are extensive – but not always called “IoT.” Hand-held devices, temperature sensors, POS devices, security cameras, traffic counters – all of these are IoT type devices and installations. Each of these exists in a silo solving a specific problem. Just like a jigsaw piece shows part of the image, each of these has part of the overall picture. Imagine connecting these pieces together to provide an overall real-time view of the store operations. This would mean that teams in store and HQ could understand what is happening in the store and improve the quality and speed of merchandising and supply chain related decisions. Unlock the data, unlock the value. The current approach dramatically limits the value that can be delivered and this is a key reason that IoT has not gained a more traction and certain innovations have not become more commonplace. An example to consider is electronic shelf edge labels – despite many pilots rarely have they been rolled across an entire store estate. The reason? The business case… Read more »
Karen Wong
BrainTrust

Yes! Thank you for pointing out the problem. So much of today’s data collection happens in silos. Integration to real-time product feeds is ideal but there’s still a lot of work to be done. We’ve worked with a few partners on pilots for our feeds, but figuring out a way to monetize this is still a struggle as there’s always short-term lower hanging fruit elsewhere competing for the investment dollars.

Harley Feldman
BrainTrust

IoT technology has been around for many years. The devices are becoming cheaper and the connectivity to the Internet to carry the data continues to become less expensive and so does the storage technology to hold the collected data. These trends continue to make collecting and monitoring the temperature of food and energy usage easier and cheaper. The biggest benefits are reducing food waste, bringing fresher food to the shelf and reducing energy usage.

IoT will become permanent technology due to declining costs and increasing value to the grocer. The learning curve for the technology is also becoming smaller as the the software tools to implement IoT solutions become more mature.

Andrew Blatherwick
BrainTrust
Reduced spoilage and waste are critical for grocers’ profitability, but also for environmental sustainability. However, stopping the waste in the first place is the better answer rather than smarter ways to get rid of it after it has gone off. The concern with statements about Internet of Things (IoT) is that it sounds like a solution in itself, which it is not. You cannot buy IoT, you have to put in place the technologies that link together via the IoT. What is important is that the technology you buy is IoT enabled. As with temperature monitors on coolers and freezers there are already technology solutions to help reduce waste that are very effective. Bringing these together passing the relevant information between them really adds to the effectiveness. Major retailers like Walmart are already on to this, but the technology is available for others to do as well. Planning and building the right infrastructure to maximize the benefits is then necessary. It is not a magical new technology, but new ways of using and linking technology… Read more »
Craig Sundstrom
Guest

“It also reports back to a maintenance team if sensors indicate equipment problems so they can be fixed early.” There’s your weak link: someone has to actually DO something once its discovered.

I voted for “somewhat likely” — it covers practically the whole spectrum, and who wants to be a grump by claiming nothing is going to happen? But I fear it will go the way of ever so many maintenance programs — neglected and starved for funds. And while the numbers (may) sound impressive when aggregated, on a per/store basis that impression quickly diminishes. OTOH, it will be another opportunity for competent companies to put even more distance between themselves and the also-rans.

Casey Craig
BrainTrust

Beyond the technology helping grocers economically, using IoT to end food spoilage will secure the loyalty of Millennials and Generation Xers who value sustainability and the companies that invest in it.

wpDiscuz
Braintrust
"Over the medium- to long-term, more grocers will invest in IoT innovations to stay competitive. Right now most of them are focused on strengthening e-commerce infrastructure"
"Efficiency is not a valid strategy for long term success — it’s a smart way to improve stores in the near term."
"The concern with statements about Internet of Things (IoT) is that it sounds like a solution in itself, which it is not."

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