How e-grocery technology can empower underrepresented businesses and communities

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In 2021, food insecurity in the US rose by 45%, with 19.5 million households struggling to feed their families. Federal support exists such as the Supplemental Nutrition Assistance Program (SNAP) that provides up to $150 per household through electronic benefits transfer (EBT) cards to increase access to healthy groceries. Yet more than 20 million households with the lowest incomes have received minimal benefits.

About 68% of the cause of food insecurity was due to access to the supermarket. Food deserts are where an area’s poverty rate is 20% or more, or where the nearest shops are more than a mile away from at least a third of the population. Customers without a car can’t get their food – and shops without customers close. But what if the local stores had demand visibility?

Ninety-five percent of executives believe geospatial data through online sales is essential to achieving financial and customer experience goals. Point of interest (POI) data in near and far areas can improve store inventory, support market reach and personalize customer offerings by providing insight into demand by region. Small, distant businesses can put their city and products on the map with online shopping platforms and reach a wider audience.

But the problem is not just physical access for rural (food desert) residents. When the country’s main anti-hunger program is limited to in-store purchases, what happens if consumers don’t have physical access to a store, transportation is limited (and costly), and their payment cards don’t work online? How can digital retailers help them?

The future of grocery stores in rural deserts is more than just being online. It is about providing access economically, physically and digitally.

Supporting economic access with EBT

Today, more than 38 million people in the US use economic aid to make purchases. The challenge for stores is that only specific items can be purchased with EBT card credit – for example, restrictions apply to alcohol, tobacco and pet food, making the distribution of orders and purchases complicated.

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There are two things retailers need to do for EBT to function online:

1. Categorize their items into eligible and ineligible products.

2. Update their transaction system to accept two digital payment methods (ie a debit card and their EBT card) for one purchase – make sure the eligibility list is applied to the EBT method.

Platforms supported by EBT will automatically split every bill and bill all eligible food items such as vegetables, grains and meat products on the benefits card and all non-allowed items on their alternative card. E-grocery technology that makes double payment a part of supermarkets’ online shopping platform will help retailers increase economic access to their EBT customers nationwide and minimize suffering in their communities.

Underrepresented businesses in rural areas can take advantage of this by increasing the number of citizens who can shop in their stores. In addition, the new EBT functionality is raising awareness among local retailers in need who had never heard of the program. When stores use their geospatial data to see patterns of member growth, purchase increases and EBT card users, they can support the national movement in identifying areas and the magnitude of the need to better allocate food aid.

Still, customers may be given the option to purchase online. But how can small retailers in deprived areas get orders to customers’ homes without breaking the bank themselves?

More convenience with omnichannel delivery management

It’s not rocket science that every van with five extra orders from customers means five extra people have to pay for the delivery fee. And when each vehicle is fully loaded, retailers also reduce fuel consumption, costs and CO2 emissions. Nevertheless, the challenge for rural communities with a smaller customer base is to ensure that every ride is optimized.

There are several ways that local retailers can use e-grocery technology to improve delivery efficiency in their region:

1. Collaborative delivery network platform: Independent nearby stores join forces to share rides (and transportation costs), from manufacturers to warehouses and customers’ doorstops.

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2. Expanding Regional Digital Customers: Opening their online stores to outlying regions, offering a larger customer base and increasing the ability to deliver at maximum capacity.

3. Scheduled Drop Automation: Stores in smaller areas can choose to only deliver on specific day(s) so that all their customers pre-plan their orders and make purchases before the weekly drops.

The roles of manufacturers, warehouses and brick-and-mortar stores overlap. Retailers must manage each’s inventory, along with their online and offline sales, to ensure that all orders are fulfilled and delivered from the most convenient location.

Omnichannel distribution is the management of deliveries from multiple pick-up and drop-off points. When smaller retailers unite, they can share distribution centers based on their geospatial customer data to improve resource allocation, minimize travel time and ensure product availability. Platforms that integrate demand, drivers, assets and inventory data in real-time support independent stores with efficient and collaborative decision-making, allowing stores to share drivers with different stops along the way.

Delivery systems also benefit seniors – my father is in his 90s and I often buy and deliver his groceries. While I can continue to order for him, today’s easy-to-use dashboards also simplify processes for techies to understand. According to NPD Group, the baby boomer demographic will have spent 49% more money online in 2020 than the year before, mainly due to an improved user experience.

But what features attract the wider market?

Mobile platforms for the customer and the retailer

Online shopping is less about replacing people who go to a store than about making local retailers accessible to a larger market. By 2025, projected mobile commerce (m-commerce) sales will double to $728.28 billion and represent 44.2% of US e-commerce sales.

With four-fifths of rural Americans using a smartphone, versus 72% using laptops and broadband, mobile shopping expands access more than any other device. However, many retailers still get it wrong.

Mobile sites account for 97% of all checkout opt-outs, compared to just 20% mobile app opt-outs (and 68% for desktop site opt-outs). With customers storing card details in mobile wallets, those in the mobile commerce space have first-hand access to improving the end-user experience. The power of apps and their ability to keep customer information secure facilitates repeat orders without entering payment details each time, promoting higher cart completion.

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In addition, apps with personal logins and purchase history make it easier for retailers to learn about their customers’ individual preferences and suggest healthy additions to supplement their shopping list. For example, data patterns tell retailers that 78% of customers buy large quantities of pasta. They report their client’s app: Hey, we noticed you like pasta. Did you know that zucchini provides vitamins C and K? Are you curious about this recipe for zucchini pasta?

By providing personalized tips and simple answer questions to their consumers, stores encourage the use of applications and can collect data to improve their inventory and further improve their customer proposition.

The move to online shopping and mobile applications opens up access to new markets – so that even the rural deserts can share and value their local goods – while sending location data back to the stores to improve product allocation.

When independent retailers, couriers and communities work together, they can share resources and data to optimize inventory, warehousing and distribution to meet customer demands efficiently and cost-effectively. Enabling customers to securely store their payment information, access personalized tips and rewards, and even use their EBT cards can help the whole community feel supported.

Bagrat Safaryan is co-founder and CEO of Local Express.

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