Labor Turnover is Costing Grocers Big Bucks in Poor Production Planning

Labor turnover production planning

It costs a grocery retailer a minimum of $2,400 every time a store associate quits, and that jumps up to $6,200 if a department manager chooses to leave. 

What isn’t included in these numbers is the expertise that a store loses, specifically, accurate production planning knowledge, when experienced staff leave. New and inexperienced staff are unfamiliar with local purchasing behavior in today’s ever-changing consumer landscape, and, as a result, will over or underestimate production and limit assortment.  

The remedy? Production planning management software which helps eliminate excessive markdowns, high shrink and ineffectual workflows, while also helping retailers increase sales. 

By introducing a software solution like Invafresh’s Production Planning Management solution, store associates are becoming inventory managers and can move away from the responsibility of making high-cost decisions. Today’s software utilizes advanced AI and analytics to make accurate predictions, reducing the chance of human error. As a result, grocers see the ROI in months with higher sales, reduced shrink and fresher products. 

What is Production Planning Management? 

Production planning is the act of developing a guide for the design and production of a given product or service. Production planning management helps organizations make the production process as efficient as possible. In the case of grocery retail, production planning manages the transformation process from raw to sellable products, while incorporating your in-stock merchandising strategies. Our production planning tool generates accurate production recommendations on a daily, per item basis for fresh item retailers and is powered by a unique demand forecast engine. 

The demand forecast engine calculates these recommendations by evaluating: 

  • Cannibalization rules 
  • Daily and weekly sales patterns 
  • Events and seasonal influences 
  • Demand from all modes of distribution

How Production Planning Management Optimizes Staff Processes 

Labor turnover

Better Organization  

By overproducing, you waste not only the product, but also the labor and packaging. For fresh departments that use multi-cycle production plans like Bakery and Meat, production planning management software can create a single daily plan that accommodates grouping of like products into production blocks to ensure that each batch is ready in time for the day’s highest demand period. Stores can now see the production requirements for the entire day and organize labor on their own terms, while still being compliant and offering the freshest product.

Enhanced Employee Training 

By building repeatable, scheduled workflows you turn everyone into a high performer. New staff learn the speed and quality of production needed to become a star performer. It flattens the learning curve, speeding up training and gets more experience under their belts, faster. 

Efficient Processes 

Store associates get a master pick list for every production cycle that limits the number of trips they need to make to the cooler and calculates total pick quantities. Instead of running to get strawberries three separate times for cut fruit, parfaits and mixed bowls, our production worksheet will tell store associates how many strawberries to prep in one go for everything.

Final Takeaways 

Without production planning management, every time an experienced employee or department head says goodbye, you lose their production planning prowess. And this happens far too frequently. According to Food Marketing Institute, in 2021, food retailers saw a 48% employee turnover rate, well above the pre-pandemic level of 40%, and suppliers saw a 29% employee turnover rate. 

But now, thanks to new technologies like Invafresh’s production planning management and forecasting solutions, grocery retailers are seeing improved yield, labor availability, and increased shelf life. Financial losses are turned into gains, and many Invafresh customers see an average increase of $80,000 to $100,000 in incremental growth margins, per store, per year.  

Curious to learn more?

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About Invafresh

With a combined 500+ years of Freshology experience, the heritage of Invafresh has enabled fresh food retailers to create extraordinary store operations performance and differentiated customer experiences. As the leader of Freshology, Invafresh is deployed in over 350 grocery retailers spanning a global reach of 35 countries with more than $100 million of Fresh revenue being transacted daily, to provide AI/ML demand forecasting, merchandising, replenishment, and sustainability and compliance solutions.  

Learn more at About Us | Invafresh.

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