Several major EDO issues and trends are predicted to impact grocers in the coming year.
Economists may be bullish on consumer spending in 2014, but for retailers the pressure to contain costs remains high.
Thus it is no surprise that in 2014 suppliers will once again be focusing on offering retailers products and services specifically designed to keep costs down while enhancing the shopping experience. Some of the top lighting, refrigeration and equipment companies and design firms discussed what they believe will be the top drivers this coming year.
Top of many lists was technology. Technology enhancements that reduce costs and streamline business will continue to drive operations in 2014, say company officials at Alto-Shaam. They add that the reduction of labor and shrink will continue to be bottom line drivers, while menu diversity will continue to drive top line sales for retailers. Todd Griffith, vice president of marketing for the Menomonee Falls, Wis.-based company, expects retailers to face a challenge in balancing this while still offering a unique and enjoyable shopping experience.
“With more choices and growing retail competition across all demographics, differentiation is the name of the game and those who can execute successfully and consistently going forward will continue to capitalize,” says Griffith.
Officials at Airius, manufacturer of the Air Pear Thermal Equalizer air destratification fan system, anticipate grocers will continue to look for ways to cut higher energy bills and search for sustainable business solutions that will improve the shopping experience, as well as boost employee comfort and productivity. “The trend to save energy and create greener stores will gain even more importance this coming year,” says Christian Avedon, a sales engineer for the Longmont, Colo.-based company.
Avedon says Air Pear destratification fans were designed to solve several common problems throughout a store’s layout—from the frozen/cold case aisles, entrances and checkout areas to receiving, storage and restrooms. He says Air Pear fans create a tight, concise column of air from ceiling to floor. By equalizing temperatures throughout the store, he says the fans can cut energy costs up to 35% by reducing run time and constant starts and stops of the HVAC system. According to Avedon, expensive and inefficient air duct systems throughout a store also can be reduced or removed entirely if the Air Pear system is engineered into the store’s design.
Air Pear fans are designed not to interfere with open cold case aisles and to eliminate fogging on enclosed refrigerated product cases. These two factors should lead to increased sales, says Avedon. Door heaters can be turned off, further reducing energy use. Air Pear fans can be equipped with an optional kit to mitigate bacteria, mold and odors. These fans can be used in cart return areas, receiving and storage areas, employee rest areas and customer restrooms, he says.
Jason Prondzinski, vice president, national accounts for the Troy, Ohio-based ITW Food Equipment Group, maker of Hobart equipment, says that in 2014 supermarkets will continue to seek opportunities for reducing operating costs while maintaining quality. Grocers will also be seeking out areas of service where they can differentiate themselves from the competition such as offering more options for prepared foods that can be taken home or consumed on-site, he adds.
“What this means for commercial food equipment manufacturers such as Hobart is that we must continue to develop and introduce equipment that can help retailers achieve operating cost reductions at the store level and make it easier for them to deliver quality products and service to their customers,” says Prondzinski.
Managing a complicated product category such as perishable foods will require new skills in food safety, supply chain management and merchandising, say officials at Hussmann Corp. Despite the continued focus on value, they predict that interest in specific high-end food categories will remain strong as consumers seek affordable luxuries in otherwise constrained lives.
“Traditional supermarkets understand this well and will continue to focus on fresh and prepared foods as a competitive differentiator in a crowded marketplace,” says Mike Seals, director of marketing, research and customer insights for Bridgeton, Mo.-based Hussmann. “We see new stores devoting more space to these categories and rolling out more sophisticated designs to create the right environment for these high-end food categories in 2014.”
Industry observers say an increasing focus on energy efficiency and environmental responsibility are among the top refrigeration trends expected for the coming year.
Based on the feedback Zero Zone officials have received thus far for their Crystal Merchandiser display, the industry will likely see more glass door cases introduced in the near future, they say. Zero Zone officials say retailers have come to see that these cases can be aesthetically pleasing and lower energy costs. With the Crystal Merchandiser that can amount to 84%, says Carl Petersen, marketing and advertising manager for the North Prairie, Wis.-based company. Petersen says that with more stringent DOE regulations coming in 2017, the Crystal Merchandiser will be in even higher demand by retailers who want to save energy and be environmentally responsible.
“I see this trend continuing, not only throughout 2014, but beyond that date to a point where open medium-temp cases will be as rare as open freezer cases are today,” he says.
For retailers that still have concerns that a door is a barrier to sales, Petersen says that a recent Zero Zone shopper survey proved just the opposite. In the survey shoppers indicated they actually prefer door cases to open cases. Petersen says the door reminds them of their refrigerator at home and they assume that the products inside are fresher, colder and cleaner than those in an open case.
Officials at Emerson Climate Technologies Retail Solutions see energy management utilizing “big data” to understand and direct operations and refrigerant leak detection as a top industry issue for 2014. John Wallace, director of product management, for the Atlanta-based company, says that while many retailers are adopting new refrigerants such as CO2 in new systems, there are additional opportunities, including leak detection systems, to more effectively lower leak rates and manage refrigerant use.
“There are many new and existing technologies that can help retailers in these areas. For example, we are seeing many customers adopt case controls and the use of electronic expansion valves, which allow a refrigeration system to be operated more efficiently,” he says.
Food quality and operational excellence continue to be an important concern of grocers, says Wallace. To maintain current levels, he says grocers will need to do a better job of reporting and monitoring store operation data, analyzing the data, taking the proper actions to fix issues and utilizing predictive and modeling software to understand what will happen in the future.
“Big data’ is the new buzzword, but the challenge comes with using that data to create a more precise picture of the business,” says Wallace. At its best, he says data analytics can assist retailers in improving energy efficiency, lowing expenses to enhance ROI, reducing complexity and managing capacity.
Getting a fix on fixtures
When it comes to store fixture trends, Tom Valiulis, vice president of marketing for Southern Imperial, based in Rockford, Ill., says in the coming year retailers will continue to look for unique ways to get more sales from a limited space. “This can be accomplished through increasing the number of SKUs in a given location or by creating displays that give the merchandise a better presentation by organizing and facing the product,” says Valiulis.
Southern Imperial offers a few options to accomplish these goals. According to Valiulis, its NEXT Merchandising System can increase merchandising space by 30% or more. It was designed to help organize and face a wide variety of merchandise from frozen foods and packaged meats to bagged salads, candy and more.
Given that design ideas are often rooted in history, Tony Camilletti, executive vice president for D|Fab, based in Madison Heights, Mich., says that in 2014—and beyond—retail design principles and ideation will likely remain similar to what they are today, with perhaps a few exceptions. “As we continue to see the increased integration of technology and mobile-device access in stores, the human experience and the theatrics of the shopping experience will always drive the need for a tactile, visually rich space filled with the discovery of touchy, feely, immediate gratification,” says Camilletti.
Steve Mehmert, president of Mehmert Store Services based in Sussex, Wis., sees a growing understanding from retailers on the need to carve out a unique niche through design in the coming year. For inspiration, he says his company will continue to look outside of grocery at the merchandising and design ideas other retail channels are featuring.
“As designers we can learn a lot from an outstanding home goods display or the architectural elements at a unique clothing store,” he says. “We will continue to evaluate those ideas and how they can translate to the food industry.”
Observers say solutions that address many of the lighting issues that have been plaguing the industry over the past several years will arise. Thomas Huff, creative director and CEO of CIP Retail in Fairfield, Ohio, says changes will come about due to cost pressures and concern for the environment.
“You can expect the lighting industry to solve their ambient lighting deficiencies regarding LED and stores will strive to be 100% LED because of energy costs, facility maintenance costs and overall green thinking,” says Huff.
Observers say additional attention will be paid to lighting quality in 2014. Lee Rhoades, chief operating officer for St. Louis, Mo.-based BARO North America, says that as a growing number of supermarket owners learn the facts about LED lighting technology there will be a reduction in lower quality LED fixtures being used and greater competition at the top for suppliers.
“One point I always stress to our customers is to truly look at the construction of the fixtures they are choosing, especially the cooling system,” says Rhoades, adding that keeping LED arrays cool is vital to both the lifetime and the light levels of LED fixtures. “A manufacturer taking a short cut here will cause a grocery store owner a lot of disappointment before those magical five years are up. ‘You get what you pay for’ absolutely applies to LED luminaries.”
GE Lighting officials say 2014 will be the year we see more grocers shift their lighting choices toward LED technology. “From overhead/high bay lighting to refrigerated display case lighting, signage lighting and more, LEDs offer an energy-efficient solution for nearly every lighting application in the grocery retail space,” says Antoinette Mileti, vertical brand manager, retail professional markets for the East Cleveland, Ohio based company.
According to Mileti, the switch to GE’s energy-saving Immersion RV40 LED lighting system helped Stater Bros. slash the operating cost of refrigerated displays while enhancing the visual appeal of vertical cases.
“By replacing 60-watt fluorescent lamps with GE’s 16-watt LED lighting, Stater Bros. will use 28,444 fewer kilowatt hours (kWh) per store per year, a savings of approximately 4.6 million kWh across the 163 participating stores and equating to about $510,000 in annual savings, based on an $0.11 kWh rate and 17 hours of operation a day,” she says.
Mileti adds that the long-life Immersion RV40 LED lighting system also contributes to an 80% reduction in maintenance costs—totaling nearly $60,000 in savings annually across all locations for Stater Bros. “As an extra benefit, LED lighting generates less heat, which translates to fewer compressor cycles in the food cases for additional indirect energy savings,” she says.
What to look for
Zero Zone has continued to expand the Crystal Merchandiser line, with the introduction of an 8- and 12-foot model that comes equipped with pairs of 24-inch wide, 74-inch tall, French-style CoolView Doors. The company has added a deep version of both the original 30-inch door Crystal and the new 24-inch door case. According to Petersen, both are also available in rear-load configuration or as hybrids, with a condensing unit kit mounted on top of the case. He hints that more exciting innovations of the Crystal Merchandiser line will be revealed in 2014.
Petersen also says 2014 will see the introduction of the Zero Zone ColdLoop CO2 System, for those that prefer the characteristics of CO2 over glycol, but still want to reduce their GHG footprint. “Zero Zone Edge Distributed Systems are also very desirable for their ‘zoned’ refrigeration that allows for discrete refrigeration areas, each containing less refrigerant than typical larger systems, lessening the severity of leak potential, while making each zone more efficient in its operation,” he says.
Hobart officials say they have a tradition of introducing commercial kitchen equipment that is easier to use and operate than previous models and includes innovative features that help improve overall efficiency of the operation. For 2014, the company is introducing a scale that will feature several industry “firsts” to help improve productivity and customer experience. “Based upon customer feedback, we have designed a scale and software suite that will include intuitive and customizable navigation, improved communication functionality and the ability to adapt to the changing needs of the grocer’s business model,” says Prondzinski.
Rhoades says in 2014 BARO will continue to raise the bar on LED track lighting with the introduction of its Alpha H2 line. “The Alpha H2, driven by the new Bridgelux VERO array, allows us to keep our lead as the most powerful track based LED fixtures for the grocery market. For our customers this means being able to have all the advantages of LED without any sacrifices in quality or light output,” he says.
BARO will also be debuting the Omega Z1, an efficient but powerful linear LED specifically designed to illuminate grocery aisles. “By combining the Alpha and the Omega luminaires we can provide a full store LED lighting design that is guaranteed to turn heads,” says Rhoades.
Looking ahead, Mileti sees refrigerated display cases, which need a high-quality technology that can withstand the cold environment while also reducing the glare on foods in freezer cases, as one of the biggest up and coming areas for LED lighting in grocery stores. For these reasons, GE’s Immersion LED lighting systems (RH30 and RV60) were created to help grocers slash energy costs while enhancing the visual appeal of products. “Paired with a modular lighting controls system, LED systems can be even more efficient,” she says.
Airius is continually innovating new destratification fan designs and began offering its new Designer Series in 2013 with custom colors, finishes and mountings for more architecturally sensitive design areas, say officials. According to Avedon, the company is testing new designs and higher efficiency motors for both its in-ceiling kits and range of seven different models that service ceiling heights from 8 to 125 feet high.
Wallace says Emerson Climate Technologies has a new case controller product that operates all aspects of the refrigeration case: lights, fans, anti-sweat and also expansion valve control. It replaced the mechanical expansion valve with an electronic version that is continually optimized to ensure efficient operation. The case controller also provides more information than previous versions. “Grocers that leverage that information through condition based maintenance will be able to achieve real value in reduction of energy and maintenance costs, with additional value in compliance for both refrigerant leak detection and food quality,” he says.
Also new from Emerson Climate Technologies is its refrigerant leak detector. The system provides monitoring of the refrigerants in key areas to insure no leaks are occurring. If a leak does occur the system can notify management of the leak and potential issues, enabling immediate response before a small problem becomes critical.
Officials at Southern Imperial say they anticipate its AutoFront System to be placed in more retail locations in 2014. The roller shelf is designed to face freestanding items like soda, juices, detergent, cleaning supplies and more. Valiulis says the slight rise on the shelf provides front facing using gravity. “It is also ideal for refrigerated cases where product is loaded from the back for first-in, first-out inventory management,” he says.
At Hussmann, new product concepts are being developed to allow for sales of hot and cold products in the same footprint and mobile displays to allow for seasonal merchandising programs. “We expect to see the continued adoption of doors on medium temperature, multi-deck refrigeration cases and integrated LED lighting solutions in 2014,” says Seals.