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A Supermarket Boosts Operational Performance with Data-Rich Insights from Arch Retail
Take control of your store performance
Book a demo to see how Arch Retail gives you real-time visibility into stock, margins, and profitability.
The importance of managing stock and margins
A successful retailer always walks a tightrope between overstocking and understocking, pricing too high or pricing too low.
To operate efficiently and profitably, a retailer needs to:
- Carry optimal stock of the right products
- Sell them at the correct prices\
- Know which products to order, when, and at what prices
A customer walks into your store and cannot find what they are looking for. It is about more than the sale of a single item. It is about your customers’ frustration. They have to return or go to another store to find what they are looking for. If it happens often enough, they might never return.
But overstocking can be just as damaging. Your cash flow is tied up in stock, and if products do not move fast enough, you risk pilferage, breakage, and expired stock.
You need stock to move fast enough - and at the right prices - to run a profitable business.
To do that, you need timely access to store performance reports to make sound business decisions.
Want better visibility into your stock and margins?
Explore how Arch BI helps you make faster, smarter decisions.
Best practices for best results
The supermarket in this case study is medium-sized, with 6 POS points and all the standard service departments (butchery, bakery, and deli).
It has been running on Arch Retail for many years. However, as the store started using the BI component more actively, it identified opportunities to improve stock management and margin control.
By implementing these changes with the help of Arch Retail’s BI, the store saw clear improvements in performance.
Importantly, they were not only improving against their own historical performance - they were outperforming their peers.
The right data to make the right decisions
The Business Intelligence (BI) component of Arch Retail gives you easy access to the information you need to make the right decisions.
Store management can access relevant performance data in a user-friendly format and use it to make timely and calculated interventions.
The diagram above provides an overview of how Arch Retail functions as a comprehensive store management solution.
The Stock Plan and Margin Plan modules are at the core of this case study:
The Stock Plan module helps maintain optimal stock levels and avoid over- or understocking
The Margin Plan module helps maximise profits through strategic and timeous pricing
Used together, these tools give you the accurate data needed to manage your business effectively.
See these tools in action. Book a demo and discover how Stock Plan and Margin Plan can improve your store performance.
Results that speak for themselves
The results below compare the performance of the store from 2019 to 2020. Despite changes in consumer behaviour due to COVID-19, the supermarket improved performance and outperformed its peers.
Proactively manage challenges & changes
The performance dashboard compares June 2020 with June 2019
Although transaction counts were lower, basket value increased significantly. Customers visited less frequently but purchased more per visit.
This trend is visible in the decline in transaction count during March compared to the previous year.
However, despite initial concerns, sales and gross profit margins increased across March, April, and May — and overall performance improved compared to 2019.
Basket size analysis further explains this growth, with both 5-week and 13-week trends showing strong improvement year-on-year.
At the same time, the shorter-term trend highlighted a potential decline — prompting management to take action early.
Turn trends into action . Get the insights you need to respond quickly to changing customer behaviour.
Pinpoint & address problem areas
Individual departments must be actively managed to improve overall store performance.
The impact of COVID-19 is clearly visible in the liquor and cigarette departments, where restrictions temporarily eliminated sales. However, the store was able to recover losses in other areas through effective management.
In January 2020, the store identified a serious issue with items being sold below target margin. By focusing on pricing, the issue was resolved within one month — and further improved before the impact of COVID-19.
The store also increased gross profit by reducing promotional sales, while continuing to monitor house brand performance - an important metric for group incentives.
Struggling with margin control? See how Arch Retail helps you identify and fix issues faster.
Maximise Arch Loyalty trends
The Arch Loyalty solution had already been in place for several years, contributing approximately 60% of total sales.
Tracking loyalty versus non-loyalty shoppers gave valuable insights:
- Loyalty customers contributed significantly to total sales
Cash profit from loyalty customers was substantially higher.
Basket sizes were consistently larger.
Although margins on non-loyalty customers were slightly higher, loyalty customers delivered stronger overall value.
Outperform peers
As part of a national supermarket group, the store could benchmark its performance against similar stores in the region.
The comparison clearly shows that the store outperformed its peers across key KPIs.
Even higher stock holding levels supported stronger sales and were effectively managed.
This level of performance was driven by applying Arch Best Practice guidelines and using BI proactively to intervene where needed.
Excel and succeed
To paraphrase the saying:
If you can’t measure it, you can’t fix it.
This case study demonstrates how the BI capability of Arch Retail enables retailers to:
- Identify and address problem areas
- Improve operational efficiency
- Increase profitability
- Outperform their competition
Ready to improve your store performance?
Book a demo today and see how Arch Retail can help you gain control of stock, margins, and profitability.
Or contact our team to learn more about how we partner with retailers to drive success.
