Sustainability can benefit the bottom line.

An article on Supermarket Perimeter summarized a report on sustainability from the consultancy group Alvarez and Marsal. Their report – “The Grocer’s Sustainability Playbook: How sustainability can boost your bottom line” – looks into the role AI and supply chain solutions can help businesses achieve sustainability goals.

“Does sustainability need to come at the expense of profits,” the report asks. “The answer is an emphatic ‘No!’”

Alvarez and Marsal point out that the pursuit of sustainability can also make grocers more effective and more profitable.

“Improving inventory management is critical to reducing waste, focusing on the most problematic categories in fresh,” according to Alvarez and Marsal. “This waste is not only bad for the planet; it can also quickly erode margins, with typical levels of waste ranging between 5-10% across fresh departments.”

A key takeaway: “Improving inventory management not only reduces this waste, but also improves margins and drives on-shelf availability of these categories which are key drivers of primary shopper traffic,” according to the report.

There are many approaches retailers can take to improve store-level forecasting and ordering. One proven forecast adjustment grocers should consider is Weather-Driven Demand, which are day/store/product level metrics that quantify how much demand will increase or decrease in the coming days or weeks due to changes in meteorological conditions. Weather-Driven Demand calculations seamlessly integrate into AI/ML based forecasts, data lakes, and leading packaged SaaS solutions.

Improved demand forecasting can propel retailers towards sustainability and be a profit enhancer.

By incorporating Weather-Driven Demand metrics, Planalytics has seen client reduce perishable waste by 12%, which corresponds to an average of over 4% in decreased carbon emissions.

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