X5 Group is Russia's leading food retailer. As of September 30, 2022, the company operates several retail chains, including 972 Perekryostok supermarkets.
Perekryostok's partnership with GoodsForecast began in August 2021 withing a pilot project to improve on shelf availability and reduce lost sales.
Perekryostok already used its own solution to monitor on-shelf availability. However, it was not successful in timely laying out goods and ensuring required on-shelf-availability. Experience in implementing similar projects, their proven effectiveness and deep industry expertise determined Perekryostok's choice in favor of GoodsForecast.
The pilot project included the implementation of the GoodsForecast.OSA solution's alert generation module for online in-store display and shelf replenishment:
1. The system receives sales receipt data throughout the day, highlights no-sales periods and determines how closely it matches the usual demand for a particular product in that store.
2. The system then generates a signal, which comes in the form of a task to check the goods in the front store and sends it to the mobile device of store employees.
3. The responsible department employee then checks whether everything is in order with the availability, price tag, accessibility and quality of the goods and eliminates any problem, if any.
GoodsForecast specialists set up data integration processes, built models for assessing product availability and finalized the signaling algorithm for alerting stores and ranking the generated signals.
The system was integrated with Perekryostok's microservice that enabled signal exchange and feedback to retail outlets.
To evaluate the effectiveness of the proposed solution, a comparative test was conducted in 2 groups each of which included 132 supermarkets. X5 Group specialists developed design for the experiment whose target metric envisaged favorable changes in the retail turnover of stores over time. It had to be at least 0.8% for statistical significance.
As estimated by X5 Group, the model showed a significant result: retail turnover in the shortlisted supermarkets increased by 1.4% in the course of the pilot project. It was also concluded that the effect achieved would be sustained when deploying the solution across the rest of the chain's stores.
A turnover increase of more than 1% has a significant financial effect across the chain. Beyond the financial component, however, there are other impressive results. The ability to ensure the availability of goods on shelves allows us not only to increase sales but also to meet customer expectations and maintain customer loyalty. Kirill Kovalenko, the Owner of the Mobile Workplace product at the Perekryostok retail chain, is quoted as saying: “That's why the project implemented by GoodsForecast has become unequivocally successful and efficient for us.”
The signal generation module of GoodsForecast.OSA solution has been commissioned in all Perekryostok supermarkets since October 5, 2022.
The system has proven to be effective in terms of both business processes and math.