Store employees play a crucial role in offering added value products and services, chiefly
by giving advice and information on areas such as remedies, photo developing, and the
health content, composition and preparation of meals. Whether or not new products
and services succeed largely depends on how employees introduce them and explain
them to the customer. Another important factor is special product presentation, making
the consumer conscious of the product's added value.
With the aid of Efficient Consumer Response, individual customer behavior is
translatable into customized store types, assortments and services. The growing diver
sity among customer needs per location, and the many changes in those needs, require
very flexible organizations. Stock supplying, supplier relations, store design, working
hours, introduction of new products and services, and store presentations are all
affected. A quick and modern information and distribution network, which can
effortlessly cope with all the fluctuations in daily patterns, is the backbone of just such
a flexible organization. Once the distribution and information network has reached a
certain scale, the myriad local variations no longer lead to higher costs.
For example, with the advanced systems now used in Ahold USA, a rural small-
format store is becoming more commercially feasible than it was several years ago.
Tops and Giant in particular are exploring this new opportunity. Modern technology
makes differentiation possible in both space and time. Tops already determines-store
orders by daily consumer purchases. The assortments in the store are restocked within
24 hours of ordering. Flexibility in store layout and product displays is equally impor
tant. Specially developed modules help each store to adapt to new demands more
quickly and cheaply than before.
Opposing differentiation in store type, products and sendees to optimize local
store performance is standardization. Precision retailing requires both. Wherever the
local assortment does not need a unique identity in the consumer's eyes, Ahold USA
can standardize the products as per content and packaging. This process is fully under
way and offers important cost savings. However, the combined scale our chains have
reached is primarily utilized in areas invisible to the consumer, such as distribution,
information technology, supplier relations and exchange of knowledge.
In The Netherlands, the costs for shelf and store space are a good deal higher than in
the United States. The country has one of the highest population densities in the world,
w ith 15 million inhabitants in a 41,526 km2 (16,033 sq. mi.) area - about twice the size
of New Jersey. Store density is likewise high, since the Dutch like to shop as close to
home as possible. Expensive store space and the relatively short distances between the
650 Albert Heijn supermarkets and the distribution centers make Efficient Consumer
Response at Albert Heijn possible more quickly and more profitably than at the
American chains. Furthermore, the tradition of cooperation between the retail industry
and suppliers, crucial to ECR, is stronger in The Netherlands than in the United States.
