all right we'll go ahead and get started so good afternoon my name is Michael Lockier i'm the vice president of brand development at the Independent Grocerers Alliance IGA and welcome to our webinar Solving the Fresh Department Puzzle: Data AI and Smarter Retail Decisions featuring our Red Oval partner Empower Fresh uh we'll talk today about a couple of topics that are critical to the Fresh category starting with a discussion around the state of fresh we'll talk a little bit about some of the operational stressors that happen in the fresh department or that are unique to the fresh department we'll talk uh quite a bit about the empower solution and importantly um results that other retailers like yourselves have uh have found as a result of implementing the solution but to get started I'd like to welcome our guests Robert Austin and Jesse Himongo and we'll let them introduce themselves robert why don't you go first thank you Michael appreciate it uh Rob Austin lifelong Kansas Cityian uh grew up in a produce warehouse in a Bob's IGA store here in Kansas City uh spent the last couple of of uh 15 20 years in a technology space and uh am just super excited to be able to to marry the two produce and and tech back together and start working with independence again great welcome Rob jesse hey yeah I'm Jesse Humango um second generation uh lifelong retailer uh have worked just about every position in a grocery store from pushing carts and begging groceries up to uh most recently director of produce retail uh for Fresh Time Farmers Market out of Chicago um I was uh I got blessed with an opportunity to uh develop with one of the uh first uh tech persons out there to uh tackle produce through AI um and I so I'm very versed in what AI can do for a retailer and that's how I kind of ended up here with Empire Fresh developing all the tools that I always wanted and dreamed of but never got to use so uh that's kind of my motivation of with uh being here produce guy always good to be uh to have the experience then come back on the other side and help out and create things that you you wish existed so we're we're excited about that um but before we get started talking about some of those solutions Jesse and Rob I think it would be a great uh conversation to talk about the the state of fresh um we know that um you know IG u kind of the brand ethos is all about local equals fresh you can see behind me uh a photo from one of our stores Nam Demoon here in Atlanta Georgia uh farmers market 100,000 square feet uh produce as you can see is is pretty much a big feature of those stores uh so let's talk a little bit about um you know fresh and the uniqueness of it versus center store what are the main drivers of of shrink and waste in the fresh department let's start there u Jesse I think uh you're up for that piece yeah um absolutely let me uh I'm going to jump in and I'm going to screen share a little bit but maybe I'll start with um kind of a question um you know how much waste do you guys think is is really out there in the uh uh in the retail sector there's there's a huge amount of of of waste out there for various reasons um the uh FDA uh chimes in I think with their most recent study which was in 2010 that there's 133 billion pounds of food waste annually and right now about uh 10% of that is at retail majority of it 37% um occurs at the household level um so there's if you think about it really retail impacts both of course what's going on at retail but also you know how much you know ends up in the trash in the fresh department is largely uh controlled by care and handling uh you know not aging inventory at store level and you can impact really 47% of it uh in totality so um that's that's definitely huge um you know departments are very uh unique they're not 12 in 12 out like grocery and a lot of other places so there's a lot of um one of the reasons why we started in produce was there's the biggest gains uh to be made are in the manual processes that exist within the produce department uh today hey Jesse and um any background on why the last study the FDA did was in 2010 yeah that's a good question they set some goals um by I think 20 was it 30 i think they want to reduce um in 2015 there you go they set a goal in 2030 they want to reduce that by 50% there's some other studies that are more recent that actually show uh that 133 billion pounds has actually grown um it hasn't shrunk at all so far so um there's just a huge opportunity with uh you know human process manual process um in the perishables in particular to minimize uh food waste and that wasn't really possible I would say until the last I don't know five to seven years because of the development of AI um you could you could go back in time uh Michael and you know 20 years ago before the existence of AI there were lots of folks trying to capture that uh but they u without AI it's not really possible they were treating it like a grocery department and perishables are so unique for so many different reasons right perishability shrink factors seasonality um all of those things you know come into play um when you're when you're factoring in a fresh department And is that in addition to that is it just the sheer magnitude you know I don't think any other category in the store has 133 billion pounds uh in general let alone going to waste so I would imagine it's quite a um quite a technical feat to to do that and without AI and without advanced uh analytics um get getting wrapping your arms around 133 billion pounds is probably pretty complicated yes exactly yeah so um go ahead Mike sorry um just you know as as as kind of a next question maybe you're headed down this path we talked about ordering and you know sort of you know what makes that more complex than center store yet um fresh in particular uh produce especially um it's very unique it so much of it is you know seasonal um it's it's not the same uh day in and day out like a lot of the other departments so there's so there's so many changing uh faces so many changing factors availability and weather can you could be in the middle of uh your the greatest crop of your life and uh one hail storm or one bad storm in Washington can ruin all the cherries for the rest of the summer so you're you're in a business where it's literally impacted all over the world by weather and it's changing you know dayto-day hour to hour minute to minute sometimes um and there's also obviously geopolitical factors too like tariffs and border crossings and things like that can that can impact your life unexpectedly as well so it's it's a it's an everchanging environment and um I would say um people with experience that have been doing produce 10 15 20 years they can get fairly good at those things over time um but there's a lot of generational reasons why uh we're kind of losing some of those uh individuals there's just a major shortage in the generational workhorse gap right now it's just creating um some shortages that everybody's dealing with so make sense so so in terms of um sounds like and we'll get to this obviously a good opportunity to take the data the learnings uh and use technology to help improve um like you said if if we're losing generational talent if we're losing uh people who have deep years of experience who have learned this right um t taking all those learnings using technology to create you know to create a tool um makes a lot of sense yep absolutely so I'll I'll go back um you know again buy produce a little bit there's there's the biggest um gains to be had because of the manual processes that exist but if you uh look at all the market research all the studies out there produce is the number one department on why customers choose to shop where they shop and uh so if you can impact produce u it's 30% of the total stores uh net profit at the end of the day so it's a huge factor in the success of a grocery store uh but it's the number one factor as to where people choose to shop so that's and that being our background um everybody that works with Empower Fresh is from the grocery industry which differentiates us quite a bit but that's why we're starting in produce and will naturally grow to the other fresh departments we're starting in what counts the most and I'll add we believe all of our fellow produce workers deserve this technology not just the center store folks uh oh there you go Rob sorry you fro you froze for a second you're back did you catch any of what I said we did and actually it cut off at a at a great point where you said uh we believe uh that employees in the fresh category deserve this technology not just in a center store and then I thought you just dropped the mic i don't know how that happened but that Let's go with it good good timing so Jesse okay great very appetizing photo thank you yeah very appetizing photo right everybody knows what the you know the backroom garbage dump dumpster looks like or all those you know trash bins going back there what they look like uh but you know right now it's estimated that supermarkets are throwing away any anywhere from 2.5 to 4% of their uh total net profits and a majority of that is in the fresh department so produce being one of the largest contributors to that so it's again just you know emphasizing you know reason why we're starting in produce and why it is important not only uh for profits but also you know it's the right thing to do as as far as like a food waste uh scenario goes where we can lessen what we're you know putting into landfills u by utilizing the lands makes sense so in terms of kind of recapping biggest most important category in terms of influencing customer loyalty perception of the grocery store a a big problem on the back end both from what's sold into customers or shoppers as well as what's thrown away in the back room which uh I'm not not sure where this is but uh really looks u unappetizing um and I'm I'm pretty sure if you could ask any grosser if they would like to increase their sales by two and a half to four percent of revenue or at least you know even half that by doing doing something simple they'd raise their hand and say yes yep absolutely so you know what what are the causes then of you know obviously it's one thing to say there's 133 billion pounds of food waste 16 billion pounds annually discarded from grocery stores but you know we talked about uh all the issues of nature etc but at at the grocery level uh what what are the stressors what are the what are the issues why why is this happening Rob you want to jump in yeah i I think the greatest percentage of it is just handling and it doesn't always fall on the retailer's shoulders either i mean it's it's this stuff's perishable it's the handling all the way from the growership or through the wholesalers into their lap it plays a huge role in how successful they'll be with each category but once it gets to them they you know they need they need to be able to manage it effectively they need to know they need to have the knowledge and the data what they're going to sell they need to be able to forecast they need to understand what's coming and all of that comes in the app in the form of data at your fingertips and this is one of the things that's been missing forever in these fresh departments yeah so what you know some of the things that are driving that I'm going to jump in uh everybody's familiar if you go on LinkedIn uh go to any kind of a Zip Recruiter job recruiter anywhere there's tens of thousands of grocery positions that are open um everybody's kind of in the same boat when it comes to that and there's a lot of factors that are driving that um right now outgoing boomers versus incoming younger generations it's 5 to2 that's a massive amount going out versus what's incoming so you know being able to hire that uh produce department veteran or grocery veteran uh off the street is almost impossible nowadays when I was coming up through the ranks um you know sitting on the produce benches um we always had the next produce manager and the one after that and the one after that they were all ready to go either waiting for you know the next spot to open up or the next store to open up uh that simply doesn't exist anymore when we were opening uh 80 plus stores with Fresh Time we were hiring produce managers off the street with no grocery background or very little uh let alone produce background so that that's a that's a major detriment everybody's dealing with the same thing it's not necessarily unique to anybody uh you probably have a bigger uh pick of the litter if you're in a suburban area versus an urban area but uh the challenge today is is to find people that are willing to commit high character people that are willing to commit and then be able to teach them and give them the tools to be successful um in their first couple months or a year uh knowing you're not going to find that 20 year 30-year veteran uh out on the street anymore so so Jesse is is it um is some of that that gap of five to two which scary is that right um demographics that there's not enough to replace or is that disinterest in the workforce disinterested in the in the industry what what's can you more simple mathematical uh incoming younger generations versus outgoing boomers right now so there there's just a there's a number gap in incoming and they say that gap will exist until uh Gen Alpha starts entering the workforce once Gen Alpha starts entering um those numbers will um even out because outgoing boomers will slow significantly alpha is going to pick up um but you're absolutely right what you're hitting on um as well um is also just the tenure um because that's also a problem it's not just a workforce gap generationally speaking um you guys can read this over here but hey you know boomers were staying in places 10 years or 10 years plus the further you go back the longer that 10 year uh will extend to 15 years you can hit 15 years by going not too far back in the future gen Z well then we'll we'll short up a little bit you know Gen X you know you're at about three years per location gen Z once you get to Gen Z one year and eight months I mean that's just that's insanity um so there's a because of the amount of jobs that are available because everybody's hiring um I think the boomers were incentivized financially to stay uh longer at places that definitely helped there's no doubt about that um and then also you working in a grocery store may not be glamorous it may actually be hard work and that could also be deterring the younger generations you know to get in this isn't what I signed up for right so you know they're looking to hop to something easier so um again the tenure um generationally speaking um it all speaks to you know why folks are hopping around and why everybody's constantly hiring um and trying to train and retrain and you're always there's always a gap and there's always a void that you're trying to fill from a just from a labor standpoint so it's almost a a you know a a a triple issue right of just the the size demographically you know the math doesn't make sense the the behavior in terms of tenure which is really interesting and I I kind of resent the fact that actually good news I was 54 in January of 2025 so didn't quite make that uh and then the the industry so I I know that um IG participated with a lot of other retailers in the most recent Coca-Cola Retailing Research Council study that was all about labor um and so there's some work that's been started to uh how how do we make grocery more attractive to the younger generations but um you know given that that's a big project um that that's that's an issue too so um it sounds like u labor is going to be an ongoing issue uh until when when the gen alpha when do they start being born yeah well most most of my kids my younger kids are are gen alpha so uh there's still a little bit of time you know you're still looking at a decade plus before they start trickling in got some time wonderful and we Hey I think we need to also utilize technology to find ways to make them want to stay longer than 1.8 years like that's you can't I mean if that continues in 10 years there'll be no specialists anywhere right we're just gonna have a bunch of people working in grocery utilizing technologies so I think I'll I'll dump tail off of what Rob's saying there uh the younger generations really expect uh technology you'll hand them some old antiquated pen paper system and you know they look at you like what the heck is this yeah this generation grew up with computers they grew up with cell phones so they're they're the younger generations in particular they're expecting to work with technology yeah so Rob I was going to ask you um gi given what you said in terms of sort of expectations what role does leadership in the grocery industry um in general but specifically at store level too what role do they play in in in recruiting and you know uh making staff want to stay how do we increase that 1.6 number uh I think it begins with them themselves embrace that's like the million-dollar question right if you can answer that right i I think it begins with you know arming them with technology that makes them embrace it as a whole so that they can not only expect it to be used or expect it to be uh in their stores but they participate in it they understand it uh look there's these technologies are affordable now and they can be utilized in a lot of ways to help run these stores and so you know the higher the adoption all the way up the tree the more effective the business is going to be as a result so that would be my my first would be you know get ingrained in it and teach it along the way and you you know it helps you build culture that way and like Jesse mentioned I think majority of these younger folks are coming in they spend a lot of time on technology in their spare time they want to be working in it in their work life too and I apologize if my mic I'm getting all kinds of things going from a tech thing on my uh on my screen here with the go to meeting no problem apologies for that so you know obviously we talked a little bit about ordering uh and kind of the issue and having leftover and leaving the trash etc but you know another key role of the of the produce manager is in ad planning um so can can you talk a little bit about um why that's I guess especially risky um you know my my own career um spent almost 15 years at Coca-Cola we didn't have the same ordering issues uh the same um issues that we talked about in terms of perishability so can you uh talk a little bit about that that the ad planning process and potentially how datadriven models can help there sure Jess you want that one yeah sure um one of one of the things we did build into our tool um was some technology to help make the right decisions on a um ad writing promotional uh platform um talking to a lot of the directors out there and you know speaking from experience because I I did this for many many years um there wasn't a lot of science or a lot of data going into uh those types of decisions uh typically when you talk to a productor hey why'd you run uh that item on it well we did the same item this week last year so we're attempting to comp it everybody's you know focused on the comp of course is you know there you're only as good as yesterday's comp sales is typically how ad writing goes or being a director or running a store goes right um everybody can relate to that so there wasn't a lot of data going into the decisions that that they were making so one of the things that that we've built into our tool is we're giving them the ability uh to set the price point that's going to meet their strategy whether that's um hey Rob you're getting some feedback uh whether that's hey uh we want to drive the most units or the most cases the most feet you know in the door uh or hey it's a back page item and we want the retail that's going to drive the most dollars uh we're going to help them find that retail that's going to match their strategy um we're going to show them uh what lift they're getting versus regular non-ad week so they can you know ensure that they're uh the items that they're advertising are meeting uh in efficiency they're they're doing what they're intended to do which is to drive business to drive sales increases um and again you'll run into instances where absolutely you're actually degrading your sales dollars and you're then degrading your margin dollars because you have to invest at a price point to degrade your sales dollars so uh there's there's a lot of losers you're a double loss out there on decisions so we're helping bring visibility to that we're helping eliminate that and then we're forecasting with you in real time uh just to make sure you're hitting all of your goals um and we're helping you accurately forecast each of those items at those price points by um using a combination of you know business intelligence BI tools and a lot of AI to identify those uh key uh key price points uh to make sure you're getting the lifts that you should and think you're getting so um we're we're doing things that would take you know a person hours to manually dig into and investigate and we're throwing it all in front of you as you uh build the tool and one of our approaches because we are uh grocery industry uh folks is that we uh we're not trying to create new processes there's a lot of other tech companies out there that will create a whole process uh to try to save you money and we what we've noticed is that when you try to create an extra step or an extra process people typically are you know they might use it when they have time but when they don't have time they're not going to use it so everything we've done from hey the ad right tool uh to AI assisted ordering etc it's done with the intention and and the purpose of we're not creating any new processes we're taking the existing processes that you guys are already doing and we're just adding a lot of efficiency we're adding a lot of power and we're making it a way more effective uh process than it would be manually or you know doing it in Excel which is typically what everybody does and I was guilty of that too right uh running a big corporate chain and we were we were managing our price book out of an Excel book that we had that thing macroed and duct tape six ways to Sunday um and if it ever broke down the company would go down with it right so we remove those types of processes and make it make it more effective and more efficient efficient I' I've still seen stacks of paper for order writing for ads uh not necessarily in the in the produce section but in general so there's um while while I applaud the the thinking behind no new processes um I I I think there's definitely u chances for improvement in processes overall but I think you're right we're we're all habitual by nature and if you give somebody a new tool and say it's a new tool and we're changing everything that you've been doing process-wise you're you're going to um you know have some issues with adoption so we jumped into the ad writing tool uh Jesse and Rob uh we talked a little bit about uh kind of empower um but let let's give it a proper introduction and maybe Rob this this this one's to you can you uh succinctly uh share kind of uh Empowerfresh and the value proposition and we can dive a little bit deeper into some of the tech powered solutions within it um well I think uh the the biggest value prop in it is is uh the combination of the benefits it brings right so it's going to bring different benefits based on uh what type of operator what type of manager you are whether it's reduction in shrink smaller coolers or increase in sales for those who think they control shrink by missing sales and running out um and then just just achieving access to the data in real time i mean most of the things that I use so I worked in the in the produce department pretty much all through the 90s right and into the 2000s most of the processes are still there and this is 2025 right so it doesn't have to be that way we've always lived in the rear viewer rearview mirror we always sit down at the first of the month we analyze the last 30 days how do we not make those mistakes and I think because of the variabil the perishability and the millions of UPC's per item and the different things that we deal with in produce we just always felt like it wasn't achievable until now and so because it exists like we need to reap the benefits because it is it does happen to be the one department where you can fill your basket up just by you know paying attention to and putting a lot of effort into you know it's easy it's easy for us to win the mac and cheese and the milk it's not easy for Walmart to win the strawberries and the bananas right we'll forever have that and we need to play more into it we need to embrace technology to feed it so you shared say you both shared your background but um I think you just touched on something Robert that we we hadn't talked about yet um you both came out of produce uh but independent right as opposed to Walmart so you're not adapting or adopting a a tool for a large multinational chain for small you know smaller independents can you speak about sort of that that aspect of of of the solution and you know because I think a lot of times um you know independents have so much on their plate um and they're you know often times new solutions come into the marketplace and they they work for larger chains but they're not working for the you know the the smaller stores so speak a little bit about that piece yeah and and oftent times what they're doing in the bigger chains is either proprietary to them or so expensive that the independents don't have the option to to even adopt it or embrace it that's that's been the difference in the past that Jesse alluded to but it's not that way any longer you know as we all know technologies advance rapidly and as they advance you know they become less costly um and but look I our founder who who dreamed up this idea Anthony Tatada like he grew up in his grandpa's little uh independent grocery store on Independence Avenue here in Kansas City i grew up in Kansas City we are a stronghold of independence we've had multiple from Dolls to Dolgians to others come in and not survive here so it's just in our blood jesse grew up in Cub and several others with his dad like it's in our blood yeah we have a little chain experience but you know I want to see price choppers of the world hold up their corner aldi is going to do what Aldi does none of us control that right there's a big difference and so that from my perspective that's what drives us as a team right there and if you don't mind I'll I'll dotail off of Rob there a little bit um a lot of those big box chains uh Michael they're either developing their own like Target has developed their own AI uh Kroger has done the same um Albertson's has partnered with somebody uh to bring AI all those large companies they're either develop developing on their own at the cost of millions and millions and massive IT teams which they have the resources to do that um you know or they're partnering with somebody to drive that that's really what's driven the AI tech into the fresh sector is the larger corporations see the need and they've been driving that and really at empower our goal is you'll never see us at any of the big corporations we're 100% for the independent retailer we're taking that technology that they may have helped drive but we're trying to provide that to the independent retail world to keep everybody at a level playing field and honestly guys if the independents lose and and we shrink out and uh ultimately the consumer loses because now they're going to be stuck with one of the major corporations uh setting retails and prices and you know not having that local flavor like the independence bring uh to the world so you we're trying to support that and u keep keep the independence on a level playing field with the big guys yeah and that's one of the one of one of the key reasons we were excited when we first started talking uh about our Red Partnership of um you know it's nice when things work for the big guys but when something is designed and developed specifically for for independence we always take a little bit more notice than uh than otherwise so I just want to make sure that our audience heard this piece and understood it and knew your focus versus uh we we touched the whole industry and we'll we'll help independence but you know our focus isn't there your focus is clearly on the independence uh first foremost and exclusively which which is a huge benefit so um let's move on a little bit we talked a little bit about ad writing but let's talk about uh kind of kind of I guess upstream about AI assisted ordering so you know can you speak a little bit about how that works and how uh you're using that to help produce shrink and all that stuff yeah um Rob I'll I'll start you feel free to to dump that in as as you see fit um but everybody's uh semifamiliar with AI or the AI the easiest way you can explain AI is a lot of computer algorithms in the past were just what else or what if hey if A then we do action B AI is a whole network of those and you have you know different outcome possibilities based on you know the the prompts you're putting in um and then you can train it you can teach it hey this is a bad answer this is a good answer this is why um everybody's somewhat that's kind of what AI is or you know a simple explanation of that everybody's familiar with chat GPT if you're not please use chat GPT uh to do SOPs and Excel sheets and all it can do anything for you if you're not using chat GPT you're probably uh wasting time uh building reports and things that AI could do for you but uh chat GPT is it's called Open AI and it's called open AI because the source is open it's the open web it's the internet so you can get bad information out of chat GPT because there's bad information on the internet so what we're doing is we're using you don't say right i know shocking uh we're using what's the term uh hallucination hallucination there's all kinds of terms you could throw at that one Michael um we're using narrow AI narrow AI um is it's it's meant to go to town on just your information so what we try to do when we connect with customers we're asking for three years history uh for the sole purpose of building that narrow AI it's a it's a form of regenerative narrow AI that we've built um and narrow AI is extremely effective at forecasting uh building and identifying trends seasonality uh price points um right now um our our AI our narrow AI use um is in the 90 percentile uh within one case accuracy on anything that we're forecasting in the produce department so that's you that's incredibly accurate so just think um you know your your brand new hire uh that has you know next to nothing as far as a training goes um they can be incredibly effective out of the gate your produce manager can go on vacation your uh third person can come in and write a very effective order um it's not all on the shoulders of the produce manager anymore heck you know assistant store director can come over uh and write an effective order and produce if need be um so it makes it more versatile um it doesn't put it all on the shoulders of one person um it makes it um transferable to other people so you're not you know caught um on days off or vacations or sick days going through COVID with people missing weeks at a time um you know that that um that goes away [Music] well yeah I think people industry definitely like the idea of vacations being able to go on vacation a lot of the guys we're working with um their produce managers were coming in on their day off and then if they were around during a vacation they would come in the three four mornings that they had to write orders just so they wouldn't have to clean up a mess when they came back so you eliminate that you can um anybody that can take a soft inventory is incredibly effective um order writer at at this point so uh one of the things that comes up anytime we talk about AI is you know the the fear of being eliminated or or losing your job um so can you talk a little bit about how um you know how to qualm those fears yeah um I I'll I'll say we got that a lot too as we were developing and building uh with circuit partners we were going out into the stores working directly with the produce managers and that was the number one comment oh so you're replacing me i'm teaching you to replace me so they can fire me um and that's 100% not true um AI will never really replace anybody uh but it'll make that one person much more effective and be able to do uh you know tasks across many uh planes versus u hey I this is one thing that I do now they can they could write an order in multi- departments they could do other tasks with the assistance of AI um it will AI always will depend on user input um as things go into the future and bots and cameras evolve that could you know change or uh somebody could manage those systems rather than you know being out there collecting all the information yourself but it's always going to need um human input it's never going to replace anybody but um and I we'll we'll get to the end quote page eventually here if somebody adapts to AI they could replace somebody who refuses to adapt adapt to AI because AI is going to make that person much more effective so it's not going to replace anybody but it's going to uh promote the people that leverage it great i'll pay attention to that now that we know we went through AI so how does how does how does this system the narrow AI help with ordering yeah um so again we're going you know to town on your history uh to identify uh those trends um to help build that really accurate forecast guys we've gone to you know great lengths to the point where um you know one of the things that impacts perishable perishable departments is actually secondary displays hey if you got another display of strawberries or blueberries or you pick an item Clementine's you're going to sell a lot more and that's one thing we can't get from the history we can get all your sales we can get your movement we can get your price points but we don't know what was on display so we've actually synthetically gone back through your data procured that information and go "Hey on these 20 blueberry ads we see one two and seven uh they got a 35% lift and it's not related to a date or a holiday or anything like that we're going to go and assume that's on a secondary display." Okay so now in the tool when a produce manager goes hey I'm building this display of blueberries or strawberries or whatever it is we're going to go back and go aha okay anytime he does that that's this is the lift that that's going to drive and we're going to you know forecast that so again it's going to Rob alluded to this earlier the produce manager that has the best conditions and the best sales but he runs a higher shrink because he's carrying extra inventory we're going to eliminate a lot of his backroom inventory we're going to increase his turns it's going to be truck to shelf we're going to reduce his food waste we're going to reduce his shrink and then you have the opposite end of the spectrum where you have guys that run the greatest shrink in the company but it's at the cost of conditions it's at the cost of instock and they're controlling their sales so for those guys we're actually not going to help them with their shrink as much we're going to help them more uh with sales and I know uh retailers get sold a bill of goods you know every day oh we can save you this much money but this is true these are uh true customer experiences what we've experienced uh through uh data and running pilot groups uh with our current customers um we're getting anywhere from a six to one to a 14 to1 ROI versus the cost of the product and even if I just gave you a 2 to one it more than paid for itself but we're uh exceeding that immensely the biggest gain potential is typically in shrink it's not always it varies you know by store but it's typically in shrink by eliminating a lot of human air um we do uh help your instock position by accurate forecasting so you're going to eliminate uh almost all of your out of stocks human air out of stocks we're going to pull a lot of dead inventory out of the stores which you know again increases turns frees up dollars um you know that's going to help you again with your shrink and then um speaking from experience here too guys um markdowns produce managers are infamous for not wanting to run out of that key front page item um so back in my past life we were self-supplied um and I was running the retail side a counterpart of mine ran the wholesale side when we implemented AI it eliminated about 25% of our polls on those front page ad items and on the retail side I didn't lose any sales i was still selling the same or greater what it told me is the guys were just you know they were scared of running out they were carrying all this extra inventory on those key items because they didn't want to run out and then they were reducing it aging it you know trying to get it out of the store so we're eliminating uh almost all of your human error markdowns needed by you know having extra on hand because you're afraid of uh running out and then there's a ton of labor efficiency gains from not having to rotate in the cooler because it's in and out and not touching things three or four times um and not spending an hour to an hour and a half on an order um you can get you can get your order time down to 30 minutes or less with AI and a few simple inputs so there's a lot of labor efficiency gains and of course as we talk to retailers we're like hey put that back into the store don't pull it out of your labor budget make your most important person your best person your produce manager put him back on the sales floor he should be talking to customers he should be merchandising building displays he should be you know out there calling and rotating and making sure everything the way it should it's running the way it should not you know spending time in the back room or in the cooler trying to manage all the inventory and all the orders so it really puts it puts your aces in in the best spot they should be what they should be doing yeah I think that's a great point because um you know uh customer service um is is at a premium and most shoppers kind of as we talked about shop shop habitually and if there's questions and there's no one around right those questions don't get answered and so um that operational efficiency part and putting more time on the selling floor is huge it is how are we doing on time Michael uh I think we've got we got about uh just under probably another seven minutes and then we can open it up for questions um Rob do you want to kind of talk about you know the future of the store tomorrow where you know things are already heading sure sure um you know I I think this is something retailers are now dealing with almost on the daily someone trying to sell them an AI of some sort and I think it's because as I mentioned earlier it's getting the solutions are getting affordable so people are uh developing them around the different areas in which they can enhance businesses not just grocery but businesses you know all across the board uh so that makes it inevitable like you know we're all going to accept it as part of our lives because it's going to become inevitable right and uh and and it's funny we we are always looking forward like our focus we're the best in produce we will always be the best in produce we will always present in produce the best value of any anybody out there on the tech side right but we're also developing in the other departments we will expand our vision is to help the independents the best way we can so we you know so our forward-looking team we're looking at things out there i mean right now we have someone take a soft inventory and then our system and our AI it tells you what to order you know I don't see a reason why uh that isn't eliminated in the next 5 to 10 years right so what you see here is just kind of a vision right there's already a combination of either cameras clipped on on shelf racks or robots roaming up and down um aisles or even drones cruising around with LAR scanners taking inventory all of these types of systems just feed directly into Empowerfresh and then Empowerfresh tells you what to order and you quickly become a a techdriven and not just in one department in all of them it's tech driven uh you got tech being accountable for what's on shelf in route and then you got tech being accountable and telling you what to order and replace and you suddenly it's managing the movement throughout the store and you're you're in that 90% above accuracy ratio as to what you need when you're ordering across the board and now you've got the same worker staff and you can really drive home i mean someone has to stock the shelves but those people can constantly be in and on the floor and around customers and now you can start doing other things that you really wish you had time to do in the store and utilizing these technologies at a very small fraction of what a person costs you to do these duties and I think it's just inevitable we're not like I said we're not the only tech company doing it um there we've talked to many potential customers who already are piloting robots or cameras and things y so uh everybody together is moving fast at this and we will all collide to deliver a solution that is is one of the greatest that that these these grocerers have seen and that that's where we're headed yeah and I'll emphasize what Rob is saying the tech already exists it's already out there it's just a matter of time before it all goes end to end so one one of the things that I know um having played around with AI and um I teach a datadriven marketing class on the graduate level um AI can only be as good as the data that goes into it right i know a lot of times independents are concerned about um you know the the way the data is structured or they don't have proper data um we talked earlier about the the multiple implementations you have um what's what's needed to get started and how do you how do you work with probably a huge variety of different data sets i think this is where uh another area where we're really unique um because we know there's going to be lots of variables in the data we're going to receive we have to receive data from wholesalers and vendors we have to receive data from the retailers themselves we have to receive data from some back office some front system so to your point we have to be versatile and I think uh because we have this a really good blend of tech experience in a lot of different things one of them uh legacy systems that seem to exist in a lot of these independent grocery stores uh it has allowed us to build some what I will call universal tools for connecting these data sets uh but even with the universal tools sometimes it it can be challenging when you're messing with legacy systems but again uh it's either we either have them internally or we partner with some great companies across the nation that that's what they do best and they help us deliver this data back and forth great i'm getting a couple of questions from the audience uh so we'll we'll we'll move on to to that real quick um can you uh explain you know we talked about wholesalers and data connections in there and one of the benefits I think you mentioned it Jesse of of of local and independence is that local piece of it so how how do um local farms local um how does local plug in to this system yeah it all it all depends on I guess kind of what local is uh if that's coming through a wholesaler that those are easy connections um we're hooked up with a partner in uh North Dakota that uh they have a lot of local potato growers so we were able to connect directly with them get invoices everything we needed from them there's lots of you know local greenhouse type um of folks who we can also connect with and get invoices which is really what we need uh to complete uh the the cycle on our side uh but then there's a handful of those um you know smaller guys like hey he grows corn for a month or two and that's all he does and he hands us a paper slip of an invoice um so obviously in those types of situations um where you know we can't connect with somebody via paper slip we give uh the produce manager uh the ability just to enter in those you know oneoff type invoices and go hey you know gross profit farms I bought 40 cases of corn yesterday and here was the cost and you know that way it hits the system and we we have visibility to it so we try to uh leave it open-ended uh for any of the smaller uh type locals that are important but they're also really uh they're hot and heavy but for a very short amount of time during the year is what's fairly typical with the small guys okay thank you uh the next question is can you give us a specific example of how your technology has been implemented at another ger so I think they're looking for like Yeah perfect this is and actually you know what the the more I think about this the more we're actually missing a handful of folks on here too we've had some recent signes and additions to this but uh you know if you recognize anybody out here I you know encourage you to give them give them a phone call vr Stories was our original uh development partner uh you know they've helped us along the way um we've had a lot of uh great ROI success with the Puitz organization down in Oklahoma um so they they've been on our tool uh six months or so now um you know Lowe's is a larger independent out in Texas um we're excited to we just actually got rolling with those guys from a pilot standpoint and then we got a you know guys on the East Coast guys in the Midwest uh you know all over the place um where we're uh either in a pilot or full customer stage with right now so um yeah like I said right now the ROIs and and when I say ROI I'm talking about an improvement in gross margin dollars um is is the ROI I'm using so anywhere from 6 to1 to 14 to1 and what is feeding that is multiple things it's growth in sales will feed that and we've seen that uh fairly consistently across the board the biggest growth uh or margin capture is through shrink that's your large the largest portion of what you're going to save is going to be through shrink and then you're going to eliminate a lot of what we used to call paper shrink but markdowns etc um and then the immeasurables are all the labor savings and efficiencies where you don't have to touch things in the cooler multiple times and you're saving 30 minutes per order 45 minutes per order uh or you don't have to scan out your shrink because we're telling you what your shrink is and you can identify all your shrink we're handing it to you on a platter um whether that's by store or by category or whole company um we can tell you exactly where all your inefficiencies are and we do that through business alerts um at each location but it it gives you visibility into those things which is you know invaluable rob alluded to it before you know everybody's always looking in the rearview mirror trying to run a sales to purchase trying to figure out where you're at for that period and then you know I I think we're roughly here this is how I'm going to move my ad three weeks down the road there's no more guessing there's no more looking in the rearview mirror you know where you are financially from a margin shrink uh standpoint and a billing standpoint live real time uh because we have the store's inventories plugged in uh every time they write an order um and that is very valuable to futurefacing decisions so you're making you're making your business more nimble great uh so we I think we have time for for two more questions and I'll I'll I'll I'll take these uh is there anything I didn't ask that I should ask you guys rob I'll let you go first uh you know the one thing people don't typically like to talk about is cost and you didn't ask about cost but I'm going to answer it in a really simple way or a couple of simple ways um you know it's it's about a couple of cases of produce is the cost of this software per week at your store you can look at it also of for the cost of us to optimize your salad case and start making money there and no waste we do the same thing for the entire department right so you know that would be the one thing we didn't discuss um there and uh Jesse I'll let you maybe pick the other sure uh you know I would say onboarding um from the time we connect with you guys that can take uh as little as uh a couple of months three months um or you know if we're connecting to multiple vendors you know the more we add the longer that will go but uh you know right now we're connected with a lot of major produce houses um in the Midwest and throughout the US um so the the more we're connected the easier it is for me to connect stores because I can just call you know who whatever wholesaler it is and go "Hey add this group or add these stores." Yeah hey sure yep they're on you're getting their information now so as we grow that that process um expedites as well and you know really guys there's the the program pays more than pays for itself it's incredible um so you know the longer you're waiting to make a decision on these things because retailers do tend to um because you're doing so many things at once it can take longer to get organized and make those decisions um so the longer it takes to make a decision you that's the longer you ran a 2% 3% higher shrink than you had to so just think of a 2% shrink savings in the produce department what that would mean for you financially a 3% shrink savings all those are very easily achievable great and then my my last question was going to be okay what's what's what's the next steps how do people get in touch with you but you you beat me to it with this last slide so uh thank thank you for being proactive on that because I know that's a question that we always get uh from attendees is what next uh so for those of you who have joined us we're at time i'd like to thank uh Rob and Jesse from Empower Fresh um one of our IG Red Oval partners for taking us through um a little bit more about uh not only their solution but what's happening within the the fresh and produce categories and specifically uh we will um send out a version of this presentation uh via email to those who attended uh which will include the the contact information here but if you have any questions in the meantime obviously uh salespowerofresh.com scan the QR code or feel free to reach out to to myself uh on the IG side so thanks Rob and Jesse appreciate your time and uh look forward to seeing this solution implemented in uh some of our IG stores real soon so that we can actually have some of our case studies incorporated in the next conversation so thanks and have a great day everyone thanks Michael