How FairPrice is Building the AI-Powered Grocery Store of the Future with CEO Vipul Chawla

Hello everyone, this is Omnitalk Retail.

I'm Chris Walton.

And I'm Anne Mazinga.

And we are coming to you live from the Fusion Group's booth at the Consumer Goods Forum in Amsterdam.

Come on by, Say hello and thanks to the Fusion Group for helping to make our coverage of the Consumer Goods Forum possible.

Now, standing between us is Vipul Chawa, the CEO of the Fair Price Group.

Vipul, thanks for being with us.

Thanks for having me, guys.

Well, Vipul, let's maybe start at the beginning.

Tell us a little bit about.

We know you've been a retailer for a while.

Tell us about your career and also about Fair Price for any people in our audience listening who might not be familiar with the brand.

Absolutely.

Well, thanks for having me, guys.

So I spent 20 years with Unilever.

I spent another 11 years with Yum Brands, you know, brands which KFC and Pizza Hut and the last few years in the Fair Price Group which is a multi format retailer in Singapore.

Predominantly in Singapore.

We have a little exposure outside of it, but largely, I would say Singapore multi format.

We've got all the big box formats you can think of.

Supermarkets, hypermarkets, convenience stores, pharmacies.

We have an E commerce business, we have an own brands, private label business, a loyalty program, a food services business.

And then more recently about two and a half, well almost three years ago we started a digital only bank.

A bank?

Digital only bank?

Yeah.

So we thought we didn't have enough work to do so we started a bank.

Didn't have enough hats to wear.

So that's what I support in Singapore.

Wow.

All right, so what brings you to cgf?

Have you been here before?

What brings you this time?

Yeah, no, We've been members of CGF for a long time as a company and it was a privilege to be able to join the board three years ago.

Okay.

What brings us here really is it's an incredible opportunity to interact with like minded retailers.

And retailers are predominantly quite lonely and usually single country operations.

So the fact that we have the ability to meet each other and talk to each other and sometimes struggle together on issues that we are facing is very powerful.

Also, I think retailers do need to have more friends.

So it's an opportunity for us to make friends and of course our dear manufacturer CPG friends who do also turn up to these meetings.

So it's an opportunity I think to get a lot of best practice learning and sharing, but also to know who to pick up the phone and talk to when you're struggling on an issue back in your own country and markets.

And I think those two reasons are what brings us back to the CGF again and again with our team.

So we bring a pretty large team because we want to, you know, we want to learn.

Yeah, well, it makes sense.

It seems like you get along swimmingly with some of the other people on the board that we've met with in the past.

Well, I have a question specifically about Fair Price Group.

You already gave one answer, that you started a whole bank industry, but how are you working to accommodate kind of the growing digital needs of the consumer right now?

Yeah, so we, you know, in the Fair Price Group, as we look at our customers, just to give you a little bit of context, Singapore is a small country with about little less than 6 million people.

Okay, so it's a small country, it's an island.

And that, you know, men, women, children.

So 6 million people in total, 1 million customers interact with our brand every day.

So we have a fairly ubiquitous presence in the country.

And that's digital, grocery and in store.

Yeah, across.

Across our spectrum.

So grocery, digital, in store, food services, and so on.

So a million every day.

A million customers or 1:6 interacts with us every day.

So we have a fairly presence.

Now 7 in 10 have a digital interaction with us, which means that the whole digital penetration of the country is becoming quite significant.

But then when you drill down a little further, when you look at habits, you will find a customer of Fairprice would typically come into our physical store three times and use our digital store once.

But yet 7 in 10 interactions have a digital component in them.

And the digital component could be you came to a store but paid through the app.

Okay.

You used our scan and go program, you used our self checkout program, you interacted with our loyalty program, etc.

So the whole omnichannel behavior is becoming very real in our business and we're realizing that there's a lot of power in it.

And as customers move to the omnichannel engagement, their spends increase and our understanding of their behavior gets so much better.

So that's a huge opportunity for us and we're investing behind it big time.

Got it.

Got it.

I'm curious too.

Are there any technologies you would call out for the audience here, back home, or either at the conference that you found particular success with, or are there any technologies that you're particularly excited about going forward to help improve things?

Yeah, so we are currently working on what we call a store of the future project.

And we looked at the customer pain points and I'M going to describe the store of the future and if you come to Singapore in August, you can experience it yourself because we're building it.

So the customer pain points are.

Customer comes to our store and is looking around for where to find eggs or milk or a certain type of biscuit or whatever it is.

So searching for products is a customer pain point.

When you come to a store, then they want to make sure they get the right promotional ideas and activities so they don't want to miss out on a promotional activity.

That's the second pain point.

The third pain point is as you're going through the store, if I buy this, will I also get a benefit on something else?

And the fourth is at checkout.

I don't want to queue up.

I want to be able to get out as fast as I can.

So here's how we are now describing the journey going forward.

A customer will walk into our store.

They'll take the trolley.

There is an equivalent of an iPad on the trolley.

If you scan your.

Your Fair Price app, we know your purchase history, so we know what you buy.

So we can start prompting you, saying, we know you buy.

3 out of 4 occasions you buy, let's make it up eggs, right?

So then you say, where do I find the eggs?

You press a button, the trolley will navigate you like Google Maps to where the eggs are in the store, right?

And just to make sure you don't miss it, when you arrive in front of the eggs, the electronic shelf level will start blinking lights up, saying, you arrived, right?

As you walk through the store, you will also be guided on various promotional activities that are happening so that you don't miss anything.

So that's the second.

The third is once you bought, let's say, eggs, maybe you want to buy bread.

So let's tell you where the bread is, let's tell you where the milk is, and so on.

So that's.

And the last is you do not have to go to a checkout counter.

You can check out on your trolley and goodbye.

So the store of the future is through.

The customer journey is something that we're going to pilot in a couple of months.

So that's one part of the application of technology, making the experience easier for our customers.

Right.

The second is our store, our store managers.

Our belief is that the customer experience will never exceed that of your own team member.

So if your team member finds it clunky, how will the customer find it?

Easy.

That's really good.

We're working on a program which is Genai enabled called Grocer Genie, where it's basically a genie in your pocket.

A store manager now can use this to figure out who's come to work, where they need to assign staff, where they need to move people around, has there been a spillage on the floor, let's fix it, etc.

So the grocer genie and the third is vision AI.

We're going to put cameras in our store which will help tell our store managers and then our supply chain, are we running out of apples or oranges or milk or whatever it is.

So all of this stuff, interestingly, these technologies are all available in the world, but putting them all together into one experience is what we are going to test out as what we call the store of the future by August.

So if you guys want to swing by Singapore in August, come and take a look at that store.

Singapore in August sounds hot.

It is hot.

It's hot.

It's hot.

Stories of the year.

Yes, for sure.

Store of the future.

That's our specialty.

And we got to go check that out.

Okay, so one quick question.

How much of how much are you using AI in your store of the future?

So everything that I described to you is powered by AI?

For example, the trolley that I talked about is a self learning.

It'll keep learning with experience.

So where to stack the products, where to run the promotional programs which are working better than the others, the whole checkout.

So everything that I described is powered by Genai.

And what about customer facing?

Will that store include any customer facing AI applications?

Everything that I described actually is customer facing.

Okay, so like when I'm searching for something it's gonna be using, I could search like in a, in a large language search.

Absolutely.

And if you have other questions, for example, you want to figure out how many calories on the products that you're buying or where it has come from, all of that can ask those types of questions.

Those kind of questions.

That's, that's really interesting.

And is the, what was it the genie?

What was the name?

Grocery Genie.

Is, is that just in the store of the future too or are you looking at that chain wide as well?

Are you looking at it there first to then look at chain?

Obviously we'll put all of these in the store of the future because we want to test your like a concept store and then based on our learnings, we'll roll it out.

Wow.

Very cool.

Very cool.

God near and dear to our own heart.

Vipul.

All right, so that's the story of the future.

But like you said at the outset, you have a lot of different formats.

So how do you decide and portion your time and keep operational, you know, control or rigor around everything that's going on in your organization?

Well, you know, we have a good team and so obviously the team does.

It's very dedicated.

It's got a great mix of fresh thinking as well as experience.

We are increasingly using both method experience and AI to improve our know how and understanding of our own operations.

I described the front facing part, the rear facing which is the roll cages, the availability of supply from our DCs into our store.

We're even testing an autonomous electric vehicle which goes every midnight from one of our DCs to the other carrying stuff.

So all of that is working in the background to make things easy for our customers.

I was going to ask you how sustainability plays a role in your store of the future.

It's a.

So electric vehicles obviously being one way, but what other ways are you including that as part of the store of the future focus?

Is there a genie for that?

That's just pure hard work.

No.

So you know, the whole sustainability piece for us, we are very focused on scope one and two, so refrigerants, electric vehicles, sourcing green energy, etc.

And we have a very clear plan to bring down 50% by 2030, net zero by 2045.

We've articulated that plan.

We publish it every year.

We do a self governing.

We do a report which we publish for public scrutiny every year called our sustainability report as part, which is issued in conjunction with our financial performance.

So that's how we are focused on sustainability.

It's the only way to do it.

All right, well, let's get you out of here on this because I think Ed and I both thoroughly enjoyed this interview and thoroughly enjoy you.

So I'm curious, what is, what is one lesson that you've learned in your career that you think every retail CEO should know or take to heart?

I don't know if everybody should take.

It as little as possible.

Don't wear a tie to work.

No, I'm just kidding.

So I think growing up in India, I found when I moved to the Western world, moved to the US and uk, I realized that many of us take resources for granted.

And when you have more resource than you need, firstly you never know it.

You take it for granted, but you don't really think particularly creatively.

One lesson I learned early in life was that as long as your ambition is greater than your resource, chances are you're going to be creative in your solutions.

So you know this a greater than R is a little formula I use for myself and I use to have conversations with my team.

We now we have a more sophisticated program there called Growth Mindset, which is what Carol Dweck teaches at Stanford.

So we've been embedding Growth Mindset into the company for the last few years.

We've trained about 2,000 odd people in growth Mindset.

So that's something that we are doing in this space.

That's really great.

Thank you, man.

Thank you for that.

Thank you so much.

Vipul, thank you for taking the time with us.

Thank you again to Vuzion Group for making all the coverage at Consumer Goods Forum possible.

And until our next interview, be careful out there.