Why Some Grocers Are Implementing Single-Source Retail Service Provider Programs

Why Grocers Are Implementing Single-Source Retail Service Providers

Not long ago, retailers relied heavily on a whole ecosystem of CPG category leaders, field teams, third party brokers, and merchandising companies to plan their layouts and execute new planogram sets in a timely manner.

However, as retailers started to search for new ways to improve the in-store shopping experience for the shoppers the single source retail service provider program emerged. This new program allows the retailer to select a single service provider that provides the in-store personnel to execute all sets in place of the complex ecosystem. Additionally, Retailers can charge a fee to CPG companies for those services.

In a single source model, the brokers and merchandise companies are no longer allowed to visit the store to merchandise the shelves. However, internal CPG field teams are still authorized to visit the stores but are faced with the dilemma of incurring duplicate costs or allowing an indirect merchandiser to stock their products and execute additional marketing investments such as promotions and displays.

Since the first program was implemented in the Northeast we have seen over 15 retail grocers adopt a single source retail service provider model, including Kroger and Whole Foods

Benefits Of A Single Source Retail Service Provider Program To Date

  • Increase Customer Shopping Experience
  • Improve Shelf Presentation & Compliance
  • Increase Trips Drivers by gaining a better understanding of the customer
  • Improve Speed to Market Execution
  • More Consistent Retail Execution
  • Optimize Assortment

Additional Questions and Concerns From Manufacturers & Suppliers 

  • Measuring Proper Execution of Promotion
  • Regulatory Rules of Certain Categories such as Alcohol and Tobacco
  • Account Managers Have Reduced Eyes at the Shelf
  • Multiple Reporting Formats to Review and Analyze
  • Lost Opportunity to Sell New Inventory at Store Level

As we move through 2018 there’s still much to be seen as grocers and suppliers work out the single source model.

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Seth Nagle, Senior Marketing Manager at RW3 Technologies understands the power of innovation but also its limitations. Attending Salve Regina in New England, starting his career in Silicon Valley, and now living in Austin, Texas; Seth provides a unique tech perspective to a complex CPG and Retail Grocery Industry that is in constant disruption.

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