Trends in the macro marketplace drove the development of SpartanNash’s new micro-fulfillment center in Caledonia, Mich. At today’s grand opening, company leaders provided an inside look at the 55,000-square-foot building where online orders for the chain’s “Fast Lane” customers will be picked and packed for home delivery or curbside pickup at SpartanNash-owned stores in West Michigan.
As the first tenant in an existing warehouse space located near an Amazon fulfillment center, SpartanNash has set up a facility designed to meet the needs of today’s consumers interested in a flexible shopping experience with in-store, click-and-collect and home delivery options. The site is equipped to hold 16,000 shelf-stable, fresh, refrigerated and frozen products that will be sent to customers of Fresh Market, D&W Fresh Market, Family Fare and Forest Hill Foods stores, mainly in the Grand Rapids and Holland areas.
According to president and CEO Tony Sarsam, the micro-fulfillment center represents a wave of the future that may require continual adjusting as consumers shift their habits and preferences. “Ten years ago, people thought the model of the future was how to deliver food to consumers at home. I think it was a surprise this past year how much enthusiasm there was for click-and-collect versus delivery at home,” Sarsam told Progressive Grocer, noting that this will be an insightful experience for shoppers as well as the retailer. “We will learn a ton of stuff just like that. As customers figure out what makes sense for them, we will work with them and adjust our model.”
Following a soft launch last week to SpartanNash’s Fast Lane shoppers, the site in Caledonia is currently fulfilling orders from 10 of the company’s locations in West Michigan. Matt Van Gilder, e-commerce director for SpartanNash, said that the service will expand to 24 locations by mid-August. “This facility can handle up to 1,000 orders a day,” Van Gilder said.
Although labor has been an issue in West Michigan as it has around the country, SpartanNash hired a full staff of 50 employees to handle fulfillment and personal shopping at the Caledonia facility. As the site ramps up, the team will include workers in onsite butcher and deli rooms.
On a tour of the micro-fulfillment center, Van Gilder showed visitors how the operations work, with products picked and packed from several areas, placed in insulated and non-insulated totes and consolidated in an area by the shipping dock before being transported to stores or homes. In the center of the warehouse, items are set up by velocity instead of by category, with high-volume products in the center and other items on the top and bottom rows. Heavy or bulk items like cases of soda will be picked first to anchor orders, while delicate fresh items like eggs are picked last to protect against breakage.
As one might expect, technologies have been put into place to ensure real-time order information and communications with shoppers. “We have an IT team that is very connected to make sure this works, and technology has pushed forth this experience,” Sarsam noted.
SpartanNash’s core businesses include distributing grocery products to independent and chain retailers, its corporate-owned retail stores, and U.S. military commissaries and exchanges, as well as fresh produce distribution and fresh food processing. No. 39 on The PG 100, Progressive Grocer’s 2021 list of the top food and consumables retailers in North America, the company serves customer locations in all 50 states and the District of Columbia, Europe, Cuba, Puerto Rico, Honduras, Iraq, Kuwait, Bahrain, Qatar and Djibouti. SpartanNash also operates more than 150 supermarkets, mainly under the banners of Family Fare, Martin’s Super Markets, D&W Fresh Market, VG’s Grocery, and Dan’s Supermarket.