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Since the pandemic hit the world, there are only a few industries that could sustain in the severe times. Groceries and FMCG products are one of them, with significant demand in the market as they come under the category of essential items. As per a report by Deloitte, this sector is one of the leading players in the global market which has shown an impressive CAGR of  27.86 percent in 2021 and is expected to grow more with increasing urbanization.

Challenges Faced by The Grocery Businesses

The increasing internet penetration across the globe and the comfort of home delivery services have significantly shifted the business model towards a more online approach in urban areas. The evolving nature of the business has made it more harder and competitive than before.

Therefore, if you are considering opening up a grocery store or online supermarket and wondering ” how to start or manage a retail grocery store business” keep in mind that while the scope for growth is limitless, so are the challenges. You must be aware of these common challenges to overcome them,

  • Spoiled Inventory Management

Well everyone knows what good inventory management could do. The reverse case may be worse. Yes! Spoiled inventory management could make your business inefficient and eventually in the loss.  ARS, or automatic replenishment system, and well-defined planograms can play a critical role in overcoming any issues in the inventory.

  • Supply Chain & Logistics Management

It is essential to maintain a continuous supply chain and smooth logistics as you are dealing with the segment of low-shelf life goods. Supply chain and logistics are the backbones of your groceries business. Lack of a streamlined process could eventually lead to negative customer reviews and a bad reputation for your brand.

  • Marketing as a revenue source

It is observed that many retailers struggle to use marketing as a revenue source. The reason is improper planning and analysis of the market. As the market is showing more inclination towards digital mode, your marketing strategy should be well-formulated in accordance with it.

  • Grievance Management

Addressing the customer grievances and satisfying them with your solutions is the key to a successful business. If your grievance management or the customer service is not up to the mark, you will end up with bad reviews and no customer retention.

  • Customer Retention

The struggle to retain customers is real in this competitive industry. The key is to build a strong relationship with the customers as FMCG and groceries involve repetitive buying behavior. 

  • Omnichannel Mode

You also need to adapt to the dynamics of the market. You cannot afford to miss the opportunity of scaling your business through online mode. You could consult a reputed retail consultant like YRC to start with your digital operations.

Importance of SOPs in Grocery Business

Standard Operating Procedures (SOPs) are not just a set of instructions that describe how to follow industry standards, but also a set of rules and guidelines meant to improve the efficiency of a business, reduce the risk of errors and deliver consistency to your business operations.

The business owner’s absence should not affect the growth of the business. SOPs will make sure that you have an organized quality system and processes in place, qualified employees, and a culture that motivates your employees, even in your absence. A standard operating procedure, in its purest form, supports the right people in the right environment.

So is the case with the grocery business. It is best for you as well as your employees to document the set of rules and guidelines that directs the daily operations of your grocery retail store so that everything is performed in a predictable and consistent manner.

 Areas to formulate SOPs

Every organization has a unique management style. The same is true for the grocery store retail business. To ensure sustainability, each retail outfit must have SOPs or Standard Operating Procedures across departments and team members vertically. From SOP format for grocery stores to SOP for warehouse operations, e-commerce, supply chain management, and logistics, end-to-end SOP frameworks can be exactly what your business needs to flourish. Initially, you could divide the areas into two parts: Front office and Back office.

The SOPs for the front office will cover the following

  • Grocery Store

Your retail grocery store, whether physical or digital, is the first impression your brand makes on the minds of the customers. Make sure to formulate an effective SOP of grocery shops for smoother functioning and scaling growth.

  • Inventory Management

No matter what type of business you own, inventory control within your facility is essential. The inventory moves when orders are placed, deliveries are made, transfers are made to external locations. It is possible to know about damage and theft losses through standardized operating procedures.

  • Customer Service

All businesses succeed or fail based on their ability to satisfy current and potential customers. The most important thing is to develop procedures that provide good customer service.

  • Home Deliveries

Imparting SOPs for home delivery which covers timely delivery along with basic training on health and safety norms is essential. A good home delivery service will help build a reputation for your brand in the minds of customers.

  • Replenishment

It continuously monitors stock, sales, and demand. This eliminates human errors, such as forgetting to place an order. It is also important to factor in forecast changes in demand when placing orders for replenishment. Doing so improves customer satisfaction, leads to increased sales, and increases service levels.

  • Cleanliness  

Clear instructions should be provided to service providers specifying the roles and responsibilities regarding cleanliness. The SOP should include separate sets of procedures for the cleaning of shelves, stores, common spaces, official’s rooms, billing desks, distribution centers etc.

The SOPs in the back office will cover the following

  • Distribution Center

Distribution center or warehouse management plays a pivotal key role in the success of your grocery retail business. These guidelines will likely cover the opening and closing times of the warehouse, routine security checks, movement of goods to and from the warehouse, inventory management, proper handling of goods, timely shipment, as well as staff hygiene protocols.

  • Purchase

One of the most critical functions of any enterprise is purchasing. In the department of Purchase, companies acquire goods, materials, and services that are needed to manufacture or create their products. This department’s principal responsibility is to ensure uninterrupted supply while staying within the budget.

  • Marketing

Marketing creates value for customers, clients, partners, and society at large by delivering, communicating, delivering, and exchanging offerings. Streamlined and documented marketing SOPs will facilitate the execution of various marketing activities in an efficient and effective way.

  • Human Resource

Employee conduct as a member of an organization is governed by its policies, procedures, practices, rules and regulations, a code of conduct, and other criteria. Employees can use SOPs as a guide to follow their employers’ established systems.

Steps to Formulate SOPs

SOPs for administrative or programmatic purposes typically consist of five components: a title page, table of contents, purpose, procedures, quality assurance/quality control, and references. Below mentioned are a few steps to follow while formulating SOPs.

  • Identify the Areas and plan the process for which SOPs are needed

The first step is to find the key pain areas in the concerned departments of your retail business. You should always keep in mind the customer’s feedback and reviews while finding these areas. Standard Operating Procedures should follow a specific format. After you have your list prepared, you can begin planning the process for creating your SOPS; this is the first procedure you will need to create.

  • Collect information for the SOP’s content

Identify the subject matter experts or retail consultants you need to consult. They can help you in setting deadlines and drafting the SOPs as per business best practices. It is a common and effective way to collect this information. Look for documentation that may already exist. You need to decide how the SOPs will be provided to employees. Establish a formal review process for the SOP Template

  • Write, review and publish your SOP

Having developed your SOP Template and gone through the steps in the SOP creation process, you can write your SOP by adding all the information provided during the meeting to the template. Identifying gaps in information will enable you to take action as soon as possible. Create an SOP implementation plan with subject matter experts and publish the SOP throughout your organization.

  • Maintaining your SOP over time

Now that your business is growing, you need to set up some rules to periodically review the SOP for relevancy and accuracy. It is best to document this process in order to ensure that it is standardized and completed correctly. You need to have SOPs for SOPs.

Why Choose YRC

Your Retail Coach is a bespoke grocery business consultant who specializes in the SOP for retail and understands the need for a clear and concise set of SOPs for a successful retail store.

At YRC, SOPs are available for all aspects of a retail business, from back-office to front office and omnichannel sales via online and offline channels. Our team of specialists and strategic SOP consultants will ensure that your retail store’s operating procedures, systems, and processes are trouble-free and deliver consistency along with prosperity to your business. Not just limited to SOPs we offer our exclusive services for business finance, business process solutions & automation, ERP, franchise consulting, etc. So get in touch with us for the phenomenal growth of your retail business.

 

PROCESS AUTOMATION

The idea of having Ecommerce Consultants on-board from the beginning itself points towards reducing the involvement of the promoters in daily operations. Ecommerce Businesses willing to be a brand reaping profits & sustaining the competition must ensure that most of their processes should be automated. The more the manual intervention, the more would be the errors.

In Ecommerce business, you get only 1 chance to impress the customer & if you mess up there, you lose the customer for long.

Process automation in respect to all the activities pertaining to customers from order receiving to order fulfilment is a must for a seamless experience for the customers.

Task Management is another grey area where most deadlines fail as 90% of the tasks are assigned manually & are forgotten, unheard, misunderstood or mistaken.

YRC Team of Ecommerce Management Consultants helps to make maximum of the processes system-driven to ensure minimalistic manual intervention.

VIDEOGRAPHY & PHOTOGRAPHY

No matter how good your product is, the customer would know only if it looks good.

Photography includes the following steps:

  • Cataloguing your products
  • Cataloguing your images
  • Backup your images (A few cloud storage solutions include Dropbox, Google Drive, Bitcasa, Apple’s Cloud Storage etc.)
  • Choose the right camera & lens (You may also outsource the photography to a third party agency)

DIGITAL MARKETING

Digital Marketing includes SEO & SMM. SEO i.e. Search Engine Optimization includes activities like back-linking, meta tags, blog-writing etc. to ensure your website ranks on the 1st page on Google Search.

Next comes SMM i.e. “Social Media Marketing” which as the name suggests including promoting your products on all the social media sites, email marketing, influencer marketing & several other BTL activities.

These activities are going to be recurring & would decide the traffic on the website, the conversions, whether the right target market is tapped, the likes, the views, the orders, the reviews & much more. YRCs Ecommerce Consultants create a budget for digital marketing right from pre-launch to launch & for each month thereafter.

Building digital marketing strategies in coordination with the agency, selecting them to signing them off would be the role of YRC.

This ensures seamless coordination, detailed interactions & desired execution as it is always advisable to work with a single agency than multiple of them.

IT INTEGRATION

Selection of the right software for smooth functioning of back-end operations right from production to webstore display would be suggested and integrated by YRC Team.

YRC’s Team defines SOPs of Product Movement, maps it with the locations & people. They then create a blueprint of all the features required in the software & help in shortlisting & selection.

IT Integration involves connecting your offline inventories with real-time online webstore so when a sale occurs, inventories get deducted real time across offline as well as online platforms.

This helps in accurate inventory management, maintaining the MOQs, re-order levels & achieving the optimum inventory levels.

Some popular software include unicommerce, viniculum for your front-end website management & Genisys for your entire back-end Purchase, Production, Accounting, Invoicing etc. management.

WAREHOUSE & LOGISTICS PLANNING

  • How many cities or countries you wish to sell in?
  • Where should your Warehouse be located?
  • Should you have one warehouse in each country or city?
  • Should you be having your own delivery team in your base city?
  • Would the 3rd party vendors be reliable? What happens when they lose or misplace your product during delivery?
  • How should I manage the logistics if my goods are coming from different countries?
  • How should the goods be stored and barcoded?
  • How much space do I require for warehouse?
  • I am sure several such questions must be haunting you while you think of starting your own fashion ecommerce brand.

 

At YRC, our warehousing and logistics experts can help you devise a strategy for all of the above mentioned queries and much more.

We design the layout of the Warehouse considering the inward, goods processing, software entry, barcoding, outward, goods return, scrap storage, goods stacking & much more.

Logistics route plan is devised considering the manufacturer to your warehouse and from there to last mile delivery locations.

UI & UX DESIGNING

This Step involves 03 distinct parts:

Part 1: Choosing the right Platform:

From several platforms available in the market right from Shopify to magento, woocommerce, prestoshop, wordpress etc. you must choose the one that fits best for your business

Part 2: UX Designing:

“UX” denotes User Experience, which if put in simple language is building the functional requirements of the website.

UX Designing includes designing the features required in the website, customer journey map, website features, the browsing features, navigation features, ecommerce order management process flow, checkout cart features, catalogue management, ecommerce payment system, cross selling features & much more.

“As per statistics, 68% of the customers abandon the carts before payment”

An interesting UX ensures the customer sticks on to the website for a longer time.

Part 3: UI Designing:

UI stands for User Interface, which means designing the look and feel of the website. UI includes using the right colours, elements and the entire aesthetics of the website.

A good User Interface ensures the user completes the task that he has come for. It navigates the user through the journey of the brand in the simplest but most effective way.

The UX designer maps out the bare bones of the user journey; the UI designer then fills it in with visual and interactive elements.

If User experience is the bare bone, user interface wraps it up with an attractive cape.

At YRC, our team if experts can help you develop the entire User Journey to ensure it is engaging!

SAMPLING & PRODUCTION

This step follows the “Designing” Phase, whether you have an in-house design team, freelance designers or an outsourced design company. It is one of the most exciting phases, as here you see your designs turning into products & your ideas turning into reality.

In most start-up cases, production is outsourced i.e. brands tie-up with the established manufacturers/ job-workers to get their products manufactured.

Sampling involves multiple 04 Stages, Fit-Sample, Prototype Sample, Pre-Production Sample & the Production Sample.

Prototype Sample is the first sample provided to the buyer. It can be in any fabric/ colour. This sample is just to understand whether the product design looks equally great in reality.

Fit Sample, as the name suggests is prepared to check the fit of the garment i.e. the various sizes, length, width etc.

Pre-production is made by the actual production line. Here the stitching quality and other aspects related to manufacturing are checked. This is the last stage where rejection can be accepted.

Production Sample is made before the production which is the replica of what is going to be finally produced.

Once you are through with all this, you are good to go ahead & get your goods manufactured.

PRODUCT DESIGNING / SOURCING

Product Designing or Sourcing is the heart of the Ecommerce Fashion Brand.

Product Designing / Sourcing can be done in several ways, as follows:

  • In-house Design Team
  • Freelance Designers
  • Outsourced Design Team
  • Ready Product Sourcing (From Manufacturer or Wholesaler)

At YRC, we evaluate your business strategy & business model to arrive at the decision, which of the above ways would be best-fit for your business. In certain cases, product sourcing may be a combination of the above.

These are the people who are going to build your brand! Whether they are the designers or merchandiser, your brand look is going to be in their hands.

If you are designing each garment from the scratch, the sourcing would play crucial role in developing design identity of your brand.

Sourcing includes fabric, trims, lining & all the raw material required to build the garment.

BRANDING

Branding is the “Look of the Brand”, right from logo to tagline, the colours used, the brand story, the brand communications on social media, the packaging & all the other aspects which speak directly or indirectly to the customers. Branding constitutes the look & feel of the brand & hence must be thoughtfully planned to match with the product that we are selling.

Branding must appeal to our target audience. Example : A golden colour logo depicting finesse, art, richness, premium, however beautiful it may be individually cannot go with a brand selling affordable kids wear products. So, your logo must be in-line with your brand positioning, whether you are an expensive brand or a luxury brand or a value for money brand, it must be depicted from your “Branding”.

It is an integral part to attract the target audience.

ORGANOGRAMS & SOP’s

Organogram is the “HR Blueprint” of the business which is created at the onset, to map out the team required across each function at various stages of the business. At the launch, only key people need to be got on board to ensure the project gets started & at this stage, all of them need to multi-task. Similarly, certain financial as well as operational goals are set for addition of the further team. Example, for the operations team, we hire 1 operations manager during the pre-launch phase & we add 1 more only when the business kicks-off & we reach a volume of selling more than 1000 pcs/ month or a turnover of more than 0.1 million USD.

SOPs are Standard Operating Procedures, a bible to run the entire organization right from Sales, Purchase, HR, Order receiving to Order fulfilment, Inventory Management, Accounts, Warehouse, Logistics, Supply Chain, Production & all the other relevant functions for the business. Business must be organized from its first day of operations; only then the tasks can be delegated.

At YRC, we design the organization structure, the processes, and approximate time taken to execute each process, job profile of every member within the organization, their KRAs, KPIs & the Reporting Structure.

CRITICAL PATHWAY

Critical Pathway Analysis (CPA), is a project management technique which cannot be overlooked while launching an ecommerce fashion brand. Brand launch process is cumbersome with multiple inter-dependent & time-bound tasks involved, which need to be tracked to ensure the project remains on track.

CPA outlines key tasks across the project, their turnaround time (TAT) & the dependencies of tasks upon each other. It identifies the sequence of tasks, their interdependent steps from inception to completion, their criticalities, and their dates of onset, target dates of completion along with the key responsible person for the respective activities. Critical Pathway helps in understanding the unimportant & not urgent tasks which may jeopardize the execution of the project because of an unexpected snag! It also maps out the potential bottlenecks which might be posed because of the dependencies of tasks upon each other & cases where the next task cannot be commenced before the completion of the previous one.

CPA detects the minimum & the maximum time involvement of a particular individual or team to execute the task, thereby arriving at the overall deadlines associated with the project.

At Your Retail Coach, we design the Critical Pathway & review it periodically to ensure the project is on track & the progress is measurable.

BUSINESS STRATEGY & BUSINESS PLAN

Business Strategy includes the vision, mission, goals, business model, business plan & strategy for all the functions within the organization.

Business Strategy is a well-defined plan that outlines who, what, where, why, how & when for the company; for example, who would be the target market, how to attract the target audience, when to launch new products, where to operate from, how to handle competitors, what would be the USP, what would be long term goal of the organization & several other answers to the 5Ws of Strategy.

Business Strategy aligns the organization towards a common goal. Business SWOT helps company to identify & overcome their weaknesses & focus to sharpen the strengths. Business strategy forecasts future risks and helps business in building skillsets to overcome the potential threats.

YRC’s Business Plan focuses on creating a “Blueprint” of the business, thereby deriving the feasibility of the concept & gauge whether the opportunity is lucrative to invest time, energy & effort. Business Plan creates cash flow understanding i.e. building inflow & outflow cash projections from Week zero to week 60 i.e. 05 year projection. Business Plan calculates the capital investment, operating costs, one-time costs, recurring costs & all the other numbers relevant to obtain the breakeven sales, return on investment, return on capital, internal rate of return & several other ratios. Business Plan is also one of the important requirements if you are targeting the “Investor Route”. Fund raising becomes extremely transparent & channelized. With business plan panned out clearly, the business will know until what point must it be stretched & where to stop, which reduces the probability of unplanned investments.

MARKET RESEARCH

Starting the concept of Ecommerce Fashion brand with Market Research ensures we get detailed understanding of the industry & this research report also acts as a social confirmation for your concept. Market Research helps in understanding the target locations, their population, potential online buyers for your product, competitors for each category, and top selling products of the competitors, competitors’ price range, offers & their responses & much more. Market Research helps in thorough understanding of your brand position as compared to our competitors. It helps in identifying gaps in the market, in your category along with the scope of the said product in the desired market. This will help in validation of your concept & prevents you from making the same mistakes as your fellow brands, eventually saving your time, energy & efforts. This phase is also a make or a break phase, as the market research study may at-times come up with some eye-popping numbers & statistics which might compel you to re-think on your product or category that you are planning to sell or alter your entire concept itself!! Market Research Reports analyse the competitors’ webstore for their traffic, conversion & sales. This is extremely valuable information to derive our inventory budgets & projections, which takes us to our next phase.