Given the technical expertise and mastery of complex systems required to run a retail grocery chain, Wynne Barrett, a partner in Hopkinton, Massachusetts-based software specialist Jera Concepts, says it doesn’t make sense that many chains settle for imprecise, low-tech production management systems.

“A lot of people try to use some sort of Excel spreadsheet and reasonably unsophisticated forecasting, which surprises me,” Barrett says. “These are all big tech companies, in a sense, because of the thousands and thousands of SKUs they have to manage. But most have a homegrown program that they or their IT departments put together.”

But at least when it comes to deli prepared foods, some chains are finally starting to get more tech-savvy, Barrett says. Boise, Idaho-based Albertson’s, for example, is currently rolling out a forecasting tool for their retail foodservice offerings.

Jera’s software, Barrett says, helps other retailers bring precision to their production management.

“What we hear about is the need to understand inventory use as it applies to prepared foods. We’re trying to help them understand what their theoretical use vs. actual use is. Consistency is also an issue for these guys, and they’re looking for tools to help them. Most of them make all things inhouse, so from store to store they have to ensure the consistency of product.”

Excel is a powerful program, Barrett says, but its focus is local — it doesn’t provide the transparency needed for retail chains with multiple stores that a dedicated production management software platform like Jera’s provides.

“There’s very little transparency into store level execution,” he says. “Two of the groups we’re working with now are looking to get greater transparency into their operations.”


Pushing the boundaries

Bronxville, New York-based At-Your-Service Software Inc., makers of cloud-based ReciProfity food costing software, is working on a customized version of its platform for the deli prepared offerings of a 30-store grocery retail chain, says Matthew Starobin, the company’s CEO.

With the customizations it does for that and other clients, At-Your-Service (and other companies like it) push the boundaries in the ever-evolving field of production management software.

For this new retail client, for example, At-Your-Service is adding a feature that will allow the company to verify labels, nutritionals, allergens, ingredient declarations and other information, Starobin says.

“With prepared foods, ingredients have to be sorted by weight, and that’s a pretty tricky process. Down the road, we’ll take that data and push it out to labeling systems. Systems are static, and if the recipe changes, you’re not likely going to remember to make that change on label. So suddenly you have a gap between what you’re publishing and what’s really going on.”

The level of detail required, Starobin says, demands a high-tech solution. “Say you switch to another barbecue sauce for your chicken. That sauce has ingredients in it, too. It might have an allergen. So you have to have a place where you can add ‘ingredients to an ingredient.’”

For the 30-store retail client, At-Your-Service is also linking up the recipes it uses for its prepared foods with its point-of-sale data. That way,  inventory squares with what’s actually being made.


Focusing on “what to make when”

Jera also is seeing increased demand for tools that help retailers answer the question, “What to make when.” For retail prepared foods sections that sell rotisserie chickens and other “hot-holding” items, knowing how much product to have at the right times is crucial.

“Hot-holding is becoming a much bigger piece, and companies are starting to look into What to Make When reporting” to handle the increased demand, Barrett says. “Hot prepared foods in general is becoming such a big deal. A lot of grocery stores, like Publix, have this whole fried chicken hot-holding area, take-home meals, etc.” 

What to Make When is still in its infancy, and Jera is working out the kinks in its own system. By the annual NACS show in October, Jera expects to have What to Make When up and running for four of its customers.

One of the main reasons retailers are increasingly looking to tech companies, Barrett says, is because they understand that tech can help them manage the freshness of products and to determine what to make, when.


Commissaries: unique challenges

That applies to commissaries, too, he says.

“We’re working with a group now that’s hoping to get better production cost analysis. The problem is, they come up with a theoretical price to charge for sandwiches. But commissaries are working on pennies-on-the-dollar margin. If they’re off by a nickel, they can lose money on that item.”

One retailer currently in talks with Jera has its own commissary. The company wants assistance on ordering, inventory use and other aspects of production management for its commissary business before tackling instore grocery, Barrett says.

“I think commissaries are realizing that these types of solutions are out there now. They’re becoming very concerned about the tracking costs of their packaged items.”

When it comes to production management, the advantage commissaries have over retail stores, Barrett says, is the consistency of their offerings, e.g. one person oversees all production of a given time, whereas in a retail chain, each store has someone who might make the same item differently than their counterpart at another store.

The challenge for commissaries, he says, is that their volumes are so big, if an error is made in costing it’s magnified.

“A nickel times 10,00 sandwiches is a lot of money,” Barrett says.

And given the large amount of fresh foods moving through commissaries, purchasing accuracy is crucial.  “They’re trying to a better job at just-in-time purchasing,” Barrett says. “A lot of times what happens with these commissaries is, they make people submit an order a week ahead of time. In a week, the weather can change, so many things can change that can affect a customer’s business. With just-in-time ordering and purchasing, both parties win, the commissary and the retailer.”

New in June for Jera is a tool that allows its software to communicate with a customer’s label printer to ensure what should be made, is being made.

“We’re able to grab a feed of what’s actually made and compare it with what the forecast was. If you were supposed to make 10 turkey sandwiches, but you printed 12 labels, you didn’t make what you were supposed to.”

Such capabilities hint at the future of Internet of Things (IOT) technology, for printers, hand-held computers and other devices. “Everything is starting to connect, finally,” Barrett says. “Theoretically, their ovens can connect if they have modern ovens. Turbochef ovens, for example, have the Internet built in.”


An edge in preproduction, food costing

At-Your-Service is also honing the retailer’s preproduction process.  “They told us that the whole preproduction process is subject to waste. They may need just 2.4 cases of lettuce, but they take four cases, and they waste it, overuse it. We can save them some money.”

Looking ahead, food costing is an area where Starobin says production management software can really make inroads and help retailers make efficiency gains.

“No one is doing the proper kind of food costing,” he says. “The ones that are doing it are doing it kind of haphazardly. They’re treating recipes like they’re assembling a bike. That’s not the world of recipes. I think we’re capturing some market share because we’re so strong in recipes, and you have to be, because in foodservice recipes and shrink are really what make it so different than anything else.”