AI-powered In-Store Inventory Management

While experience and expertise are valuable, they are sometimes insufficient. "We also need tools to help us make the right decisions," says Arthur Caron, supply chain director at Monoprix. The company has developed a predictive AI solution with its data scientists, tested in around 100 stores since the summer of 2023.

"Machine learning allows us to estimate that a store will sell ten jars of Nutella next week and that we need to place an order now to ensure these sales," explains Caron. "In short, AI helps us anticipate our needs and meet those of our customers."

This technology works by analyzing a massive amount of data that a human could not process. For example, the start-up Ida, which markets a solution dedicated to the fruit and vegetable department, relies on around 100 parameters, including "market context, average income, seasonality, local events, holiday periods, competitors' opening hours, competitors' prices, history...", lists Mateo Beacco, its co-founder and CEO.

The tool, which is based on data from 6,800 stores in France, can be consulted daily when ordering. "Today, department managers make decisions not based on data. However, ordering the right quantity can massively reduce out-of-stocks and fight against waste, especially in the case of fresh products, which perish quickly," emphasizes Beacco. He claims a "30 to 40% increase in turnover" in the fruit and vegetable departments of his clients.

AI can also be used to refine assortments according to the objectives defined by the stores, which can fluctuate. "We can notably improve the promotion of new products to gain market share, even if it means reducing margins, or optimize the margins of safe and well-established products. Finally, we work on the complementarity between products, by grouping, for example, utensils and Asian products to allow the preparation of a complete meal," says Fabien Thomas, commercial director for France at Retail Insight, which has worked with 35,000 stores worldwide, including several Walmart, Kroger, and Marks & Spencer stores.

AI can also be used to better evaluate stocks and, as a result, reduce out-of-stocks on shelves, a crucial issue for the retail industry. In 2022, the gross loss of earnings due to out-of-stocks reached 4.8 billion euros in hypermarkets and supermarkets, according to the LSA-NielsenIQ barometer.

Source: https://www.lsa-conso.fr/comment-gerer-son-offre-en-magasin-avec-l-intelligence-artificielle,454562

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