Store Shrink Results Matter

Strack and Van Til Reduces Store Shrink and Improves Profit with Aggressive Store Operations Control Program

Company Background – Strack and Van Til, LLC

[frame_left alt=”store shrink” title=””]https://dc4842.a2cdn1.secureserver.net/wp-content/uploads/2011/03/losspreventionimage2.jpg
[/frame_left]One of Chicagoland’s leading grocery chains, Strack & Van Til (SVT) operates about 30 supermarkets in and around Chicago and northern Indiana. Stores operate under the banners of Strack & Van Til, Town & Country Food Market, and Ultra Foods. The chain offers full variety grocery and packaged foods, and large produce, meat, delicatessen and bakery departments in each of its stores. Strack & Van Til is a very successful company operating mid and high volume stores with a long history of community involvement. The company is owned by the Chicago-based grocery distributor Central Grocers.

The Challenge

Facing increased competition and profit squeezed by the negative impact of the current economy, the Executive leadership team at SVT needed to find new ways to preserve their current market share and increase their store profitability. With a long history of achieving solid financial results, SVT needed to find new ways to grow sales, improve customer service and maximize store profits. Specifically, they wanted to: measure and reduce store shrink; improve store conditions to grow existing store sales; improve store manager and department manager best practices and improve overall customer service.

Implementation

After much research, the SVT Team selected the store operations control and shrink reduction experts from the Retail Control Group as their trainers and consultants to create and then guide them through their profit improvement initiative. In late 2009, the Retail Control Group conducted a detail store shrink audit at SVT and implemented their Total Store Manager Program for Profitable Selling beginning in early 2010. The program was designed around 5 core store operating control practices, the development of comprehensive store Standards, and disciplined implementation execution coordinated by the experts from the Retail Control Group.

Store Shrink Reduction Results

Beginning benchmarks of the Total Store Manager program improved 49% in less than 6 months. Store Manager, Store Team and Supervisor engagement and follow-through resulted in measurable store operations and profit in the following areas:

Inventory Reduction $1,800,000.
Reduction in Grocery Shrink DOWN 6%
Reduction in Produce Shrink DOWN 27%
Reduction in Meat Shrink DOWN 15%
Reduction in Deli Shrink DOWN 18%
Overall Supply Costs DOWN 9%
Improvement to Deli Gross Margins UP +2 Full Percentage Points
Improvement to Meat Gross Margins UP +8 Full Percentage Points
Improvement to Produce Gross Margins UP +1 Full Percentage Points

Store Shrink RESULTS Matter!

According to Strack & Van Til President, Dave Wilkinson: After just 7 months on the Total Store Manager (TSM) program, our Produce shrink is down 27%, Meat Shrink is down 15%, Deli Shrink is down 18%, Grocery shrink is down 6% and 91% of our store associates understand our objectives and are actively participating. That’s really impressive.
Store Managers and District Managers alike have embraced the TSM program. They are actually excited and look forward to the workshops. Feedback is overwhelmingly positive and RESULTS prove it. Stores are cleaner, cash flow impact is excellent, grosses are very good and store teams are focused and determined.

Our Executive Team particularly enjoys the Quarterly Business Reviews. They help to drive execution accountability and help us stay on track toward measured results and consistent and constant improvement.

The Retail Control Group approach to Profitable Selling and Store Shrink Reduction has focused us on selling with optimal shrink control. It’s an excellent mindset. Our store standards have definitely improved, formal shrink controls are firmly in place and moral is at an all time high throughout the stores thanks to the Total Store Manager approach. I definitely recommend the Retail Control Group and the Total Store Manager program for reducing Store Shrink.