SUMMARY

How does moving from manual to automated space optimization processes make a difference? Just ask Pets at Home, which now sees profit increases up to 13% and sales growth up to 12%. This translates to a potential 5x profit improvement when contrasted with its former methods.

BACKGROUND

When Anthony Preston founded Pets at Home in 1991, he had a vision of a customer-focused, large-format pet store. He succeeded. Since then, his company has dramatically grown to 450 stores, 350 of which contain vets and grooming services, meeting the new demands of its customers. Pets at Home is the dominant player within the UK pet market, with annual revenues over £898 million.

CHALLENGE

In recent years, Pets at Home has seen a continuing growth in the number of SKUs within its stores. With more and more products being added, it faced an increasing challenge of finding available space to display them. The pet retailer also wanted to review its floor space, so it could dedicate more space to in-store services. It recognized the need for a software solution that could calculate which products it could delist without having a detrimental impact on profits, while freeing up more space for services. This solution would also need to provide the most relevant assortment to serve its variably sized stores – with its largest store being six times larger than its smallest. Pets at Home knew that it couldn’t resolve these challenges on its own using manual processes such as Excel databases. It would simply take them too long to execute.

SOLUTION

During the selection process, Pets at Home undertook a proof of concept (PoC) with Symphony RetailAI using one of its standard stores. It compared its own store space optimization process and results against SR Category Space Optimization. Prior to the PoC, using its existing manual space optimization practices, the retailer delivered results of 2.5% profit. However, with Symphony RetailAI’s category space optimization solution, Pets at Home achieved a 12% potential profit outcome – 5x higher than the method it was currently using.

After evaluating other vendor solutions and considering the significant profit potential demonstrated by the PoC with Symphony RetailAI, Pets at Home selected SR Category Space Optimization.

BENEFITS

Since selecting Symphony RetailAI, Pets at Home is now:

  • Seeing profit increases up to 13%
  • Sales growth up to 12%

For the future, Pets at Home will use the Symphony RetailAI technology to optimize new stores that it is building. It will also explore how best to support trading teams to help them better understand how their assortment fits into the varying available store space.