CASE STUDY: HANNAFORD

NextChoice Intelligent Self-Service Solution Delivers Four-fold Increase in Self-service Orders

THE COMPANY

Founded in 1883, Hannaford Brothers Company Supermarkets is headquartered in Scarborough, Maine and operates 142 stores throughout New England with 22,000 employees. Hannaford Brothers Company is a member of Delhaize America, the U.S. division of Brussels-based Delhaize Group (NYSE:DEG), with $15.5 billion in sales and over 1,500 stores from Maine to Florida. A recognized and respected leader in the industry, Hannaford’s has a long history of being at the forefront of many important business and cultural changes that have shaped the United States’ grocery industry over the last century.

Many of the major Supermarket chains are already testing and piloting self-service kiosks and Internet ordering solutions to allow customers to order high margin items from the deli, bakery, floral and prepared foods departments. In 2004, Hannaford installed NextChoice’s NextWave Intelligent Self-service System in the deli of their Rochester, NH grocery—a 58,000-square-foot superstore—and has averaged a four-fold increase in self-service deli orders per week. Hannaford’s major goals were improving customer service, re-deploying labor and increasing revenue.

THE SOLUTION

The solution includes a customer-activated kiosk at the store’s entry, an employee-activated terminal at the deli counter, a refrigerated case to hold completed self-service orders, two prep screens, a customer-receipt printer and a second printer that prints labels that are attached to the bags containing self-service orders. These completed orders are then placed in the refrigerated holding case for customer pickup.

Hannaford revamped the deli operation by dividing its 20 deli workers into two categories: One category takes orders and the other fills them according to the prep screens. This redeployment of labor vastly improves efficiency because order takers can focus exclusively on face-to-face service for traditional customers while order fillers complete orders from the counter as well as the kiosk.

Another way the solution improves efficiency is by placing kiosk and counter orders in the proper place in the queue so that orders appear in sequence on the prep screens. Looking at multiple orders on the prep screen, order fillers can note when two or more orders have the same item. This allows them to fill those items simultaneously—reducing prep time and avoiding additional trips to the deli case. Customers ordering at the kiosk receive a printout of their order that shows the estimated completion time.

THE RESULTS

Hannaford has realized many of its goals. In addition to reducing average customer wait times by half during peak times, NextChoice’s NextWave Intelligent Self-service System has reduced the amount of labor required to take orders.

As for labor redeployment, deli orders prior to installation were handled exclusively by employees. When the NextChoice solution was installed, initial kiosk orders tallied a couple hundred per week. Eighteen months into the deployment, that number has climbed four-fold—all of which no longer need to be received by a deli employee. Customers can still place orders directly with deli employees so customer contact and personal service remains intact.

The deli manager also noted that typical customers usually ordered a few items prior to intelligent self-service. Today, Hannaford is recording a 75% increase in the average number of deli items being ordered through the kiosk with a wider variety of items.