Latest news with #REMA1000
Forbes
7 days ago
- Business
- Forbes
Smarter Retail Planning: Bringing Pricing And Inventory Together
Devadas Pattathil, retail thought leader, cofounder & CEO of and previously online grocery executive at Walmart. Back in March 2024, NPR's Planet Money featured a fascinating episode called 'Is Dynamic Pricing Coming to a Supermarket Near You?' It highlighted REMA 1000, a Norwegian grocery chain that's doing something smart—using real-time competitor data and electronic shelf labels (ESLs) to update prices rapidly. But what set REMA 1000 apart wasn't just dynamic pricing. Their biggest innovation was how they connected pricing with inventory management to reduce waste, improve sell-through, and protect margins. This story isn't just about grocery stores—it's a lesson for retailers and brands everywhere, whether you sell in stores, direct to consumers or through marketplaces. The Problem: Planning in Silos Today, many companies still plan in disconnected steps. They forecast demand, assuming prices won't change; buy inventory based on those forecasts; and only later adjust prices—often as a reaction to market conditions. This siloed approach causes common issues. Inventory planning doesn't take pricing into account, leading to overstocked items that end up with late markdowns and fast-selling products running out too soon, leaving money on the table. Promotions are also planned without fully understanding inventory availability or margin impact. REMA changed this by combining real-time competitor price tracking with dynamic price updates on ESLs. They marked down perishables early to avoid spoilage, raised prices on scarce items and used pricing data to continuously improve demand forecasts. This created a tightly connected system where pricing, inventory and forecasting all worked together seamlessly. What Retailers And Brands Can Learn Traditional demand forecasts often assume a fixed price, but in reality, price affects demand a lot. Promotions cause demand spikes, price sensitivity varies by product and region, and competitor prices constantly change. Instead of forecasting one fixed number of units at a set price, it's better to model demand as it changes with price. For example, you might forecast selling 1,300 units if the price is $20, 1,000 units at $25, and 600 units at $30. This approach lets you plan inventory and pricing together, rather than separately. Moving beyond this, companies should use integrated models that recommend how much to buy based on pricing strategy, simulate sales depending on price and promotion timing and adjust prices according to expected inventory levels. For brands, this means planning product launches, bundles and promotions while keeping inventory realities in mind. For retailers, it means rethinking how markdowns, sales and restocking interact. Looking Ahead The future points toward intelligent Agentic AI systems where pricing agents collaborate closely with inventory planning agents, all connected with forecasting and replenishment. These systems can help answer important questions like: 'What's the best price to sell 90% of stock in four weeks?' or 'How much inventory do I need to support a 30% off sale?' or 'Which products should I push based on current stock and margin?' To answer these questions, you need systems that simulate pricing, demand and inventory together—not just separate demand plans or price calendars. Instead, these elements form an adaptive loop where each influences the other in real time. That said, as with any emerging technology, Agentic AI systems come with their share of limitations and challenges. A recent study highlighted that many agent-based systems today are still under development and can fail to perform efficiently under real-world constraints. Retailers should approach these tools with clear performance benchmarks, tight integration testing and human oversight to ensure decisions made by AI agents align with broader business goals. Summary REMA's example is powerful, but the bigger truth is this: price and inventory decisions are deeply linked. Whether you're a global retailer or a growing brand, your success depends on your ability to forecast demand based on price, price products based on inventory and plan inventory based on your pricing path. The next era of retail planning will be defined by real-time responsiveness, powered by models that treat pricing and inventory as two sides of the same coin. If you want to stay ahead, it's time to start thinking of pricing and inventory as a connected team, not separate tasks. While the operational benefits of dynamic pricing and ESLs are compelling, it is important to acknowledge consumer sentiment. Surveys show that many shoppers view dynamic pricing skeptically—especially when it resembles surge pricing. To build trust, retailers must communicate clearly about how and why prices change. Transparency, consistency and fairness must be foundational. Leaders can set the tone by committing to guardrails—like avoiding exploitative pricing in emergencies—and by emphasizing how pricing flexibility helps reduce waste, ensure availability, and improve sustainability. Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
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Business Standard
29-07-2025
- Business
- Business Standard
Blink and cost of milk is different: Uber surge tech now in supermarkets
Imagine you go to a grocery store, reach for a carton of milk, and by the time you put it in your cart, the price has changed. Not because of a special sale or a cashier's mistake, but because the price tag itself is now a tiny digital screen that updates in real time, multiple times a day. That's not science fiction. It's already happening across supermarkets in Europe and the United States, where electronic shelf labels (ESLs) are replacing paper tags. These dynamic digital labels are quietly revolutionising grocery pricing — and possibly introducing a future of real-time 'surge pricing' for basic staples. According to a report published by T he Wall Street Journal, ESLs are already in use at several major US chains and allow grocers to change prices up to 100 times a day. Retailers say the shift from traditional paper tags helps reduce labour costs and paper waste, while enabling faster markdowns on perishables. However, the same infrastructure raises the possibility of surge pricing, price increases during high-demand periods, prompting concerns from regulators and shoppers. How retailers are using dynamic digital pricing In Europe In Norway, REMA 1000 uses ESLs to make real-time pricing adjustments in order to stay ahead of competitors. The Wall Street Journal reported that prices on certain items like milk or eggs may change dozens of times a day, especially around holidays. In the Netherlands, Albert Heijn, part of Ahold Delhaize, uses ESLs in over 1,200 stores. The system monitors near-expiry items every 15 minutes, discounting them up to four times daily—starting at 25 per cent and going up to 90 per cent—to minimise food waste. The company estimates this has reduced waste by over 250,000 kg annually. However, despite the tech, stores occasionally still use physical stickers because early trials showed customers often missed digital discounts. In the United States Walmart has deployed ESLs in more than 400 of its nearly 4,600 stores and plans to expand to cover half of its locations. Kroger and Whole Foods are piloting ESLs. Lidl US began rolling out ESLs in 2024. In India: Dynamic pricing is limited to transport, hospitality In India, surge pricing is restricted in certain sectors. The Ministry of Road Transport and Highways recently issued the Motor Vehicle Aggregator Guidelines, 2025, which permits cab aggregators like Uber, Ola, and Rapido to charge up to 2x the base fare during peak hours. The updated guidelines are an expansion from the previous limit of 1.5x. There is no equivalent model for dynamic pricing in retail or grocery stores. Real-time pricing tools such as ESLs are not yet widely adopted in Indian grocery stores. Why lawmakers and consumers are worried The potential for real-time price increases on consumer staples has raised red flags among policymakers and consumers: In the US, Senators Elizabeth Warren and Bob Casey (now retired) wrote a letter in 2024 to Kroger expressing concern that digital tags could allow for price manipulation during holidays or natural disasters. The letter warned that ESLs 'appear poised to enable large grocery stores to squeeze consumers to increase profits". In the UK, Members of Parliament questioned grocery chains Tesco and Sainsbury's about surge pricing technology after reports from France indicated that prices for barbeque items rose alongside outdoor temperatures. Public reaction on social media has also reflected broader anxiety, with many users speculating whether essential products might soon fluctuate in cost throughout the day. What is surge pricing? Surge pricing—also referred to as dynamic or demand-based pricing—is a strategy where prices fluctuate in real time based on demand levels. It is commonly used in ride-sharing, hospitality, and e-commerce. In the ride-sharing industry, platforms such as Uber and Lyft use this model to match driver availability with passenger demand, especially during rush hours or public events. Hospitality providers, including hotels and rental services, use similar mechanisms to adjust room rates during peak travel seasons. E-commerce platforms also employ dynamic pricing during flash sales or product launches to balance inventory and maximise revenue. What retailers are actually doing with ESLs Despite the concerns, retailers have been clear about the current uses of ESLs: The main objective is to save labour by eliminating manual price changes and reducing environmental impact by cutting down on paper tags. Most grocers, including those in Europe and the US, state that price reductions—especially for near-expiry goods or to match competitors—are the primary use. According to REMA 1000 and Lidl, any price increases are done overnight to avoid confusing or upsetting customers. Will surge pricing really come to the grocery aisle? So far, there is no concrete evidence that US grocery retailers are using ESLs for demand-based pricing. According to a McKinsey & Company report, real-time analytics and predictive modelling are increasingly enabling such pricing strategies across sectors. A 2021 report stated that dynamic pricing" doesn't necessarily require ultrasophisticated software that changes every product's price multiple times a day". Adding that even traditional retailers can benefit from "merchant-informed, data-driven algorithms that recommend price changes for selected products at some level of frequency". However, a study by researchers from UT Austin, UC San Diego, and Northwestern University added that real-time surge pricing, especially in physical stores, is unlikely due to two key constraints: In-store demand is difficult to track at the necessary granularity for algorithm-driven pricing. Customer sensitivity to price shifts is high. Shoppers may abandon purchases if prices increase before they reach checkout. What comes next for grocery pricing? While real-time price hikes remain rare, ESL adoption is expected to expand: More US grocery chains are likely to introduce the technology to streamline pricing operations. Intraday price reductions—especially on perishable or seasonal items—are expected to increase in frequency. Price increases during active shopping hours are still considered unlikely due to reputational risks and customer trust concerns. Fast food sector also experimenting with surge pricing Last year, fast-food chain Wendy's announced plans to test a dynamic pricing model for menu items in 2025. Under the proposed model, prices would vary during the day based on demand; however, it clarified that they would not raise prices during peak hours. While the company said that the rollout would begin as a test, as of July 2025, no surge pricing has been implemented. Following the announcement, Gizmodo conducted a survey that found that 52 per cent of respondents equated surge pricing with price gouging, while 65 per cent said it would complicate food purchasing decisions. The bottom line Electronic shelf labels are giving retailers unprecedented control over pricing and operations. So far, they are mainly being used for efficiency gains and markdowns, not for surge pricing. However, as the technology becomes widespread and as other industries explore real-time pricing models, the conversation around transparency, fairness, and digital automation in pricing is set to intensify.
Wall Street Journal
28-07-2025
- Business
- Wall Street Journal
Welcome to the Grocery Store Where Prices Change 100 Times a Day
Shoppers in Norway are used to seeing prices at the grocery store change in front of their eyes. On electronic labels that line the shelves, the listed price for eggs or milk fades, the screen blinks and a new figure flashes up, all in a matter of seconds. Prices can change up to 100 times a day at Reitan's REMA 1000-branded grocery stores across Norway—and more often during holidays. The idea is to match or beat the competition with the touch of a button, says REMA 1000's head of pricing, Partap Sandhu. 'We lower the prices maybe 10 cents and then our competitors do the same, and it kind of gets to [be] a race to the bottom.'
Yahoo
16-07-2025
- Business
- Yahoo
REMA 1000 partners GK Software to enhance in-store operations
Norwegian grocery retailer REMA 1000 has formed a partnership with GK Software, a cloud-based retail solutions provider, to overhaul its in-store operations. The collaboration will see the deployment of GK's Cloud4retail platform across more than 680 REMA 1000 stores to provide a more 'personalised and future-ready shopping experiences across all touchpoints.' REMA 1000 aims to establish a flexible and scaleable in-store ecosystem to adapt to the rapidly changing retail landscape. GK Software's Cloud4retail offers a unified commerce platform that integrates various applications to enhance the customer experience. These solutions include GK's OmniPOS and MobilePOS for flexible customer service, GK Engage for designing loyalty programmes, and GK AIR for AI-driven personalisation and dynamic pricing. GK Software CEO Michael Scheibner stated: 'This collaboration was built on shared ambitions for customer-centric innovation and teamwork. Together, we are setting a new standard for grocery retail.' The joint effort between the two companies is already underway, with active work on the implementation process to ensure a swift and efficient rollout across REMA 1000's extensive store network. REMA 1000 operates under the Norwegian Reitan Group. REMA 1000 Norway and REMA 1000 Denmark are individual concept companies in Reitan Retail. In April 2024, REMA 1000 teamed up with Market Pay to improve its in-store payment systems. The alliance results in the introduction of Market Pay's Pay on-site solution throughout REMA 1000's chain of stores. Market Pay provides REMA 1000 with the latest PAX Android A35 payment terminals, capable of handling a variety of payment options and additional services. "REMA 1000 partners GK Software to enhance in-store operations" was originally created and published by Retail Insight Network, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
