business news in context, analysis with attitude

From the Wall Street Journal this morning:

"Grocery chains looking to deploy new technologies are running into internet bandwidth limitations because of aging hardware and remote locations. 

"Even as cutting-edge technology, including AI-enabled inventory tracking systems, moves from the pilot phase to the shopping aisle, many stores remain unequipped to handle network requirements for even basic tech used to boost internal operations and customer shopping experiences.

"Rom Kosla, chief information officer of supermarket operator Ahold Delhaize USA, said some stores in the franchise don’t have enough bandwidth to reliably run the company’s latest human resources system at its highest performance level. Even electronic shelf labels that allow retailers to automatically update pricing displays are a question mark, in part because of their bandwidth demands, said Mr. Kosla."

The story goes on:

"Historically, the grocery industry has been a low investor in bandwidth, according to Michael Colaneri, vice president of global business, retail and enterprise solutions for AT&T Business, a division of telecommunications holding company AT&T Inc.

"Now, the need to digitize operations to cut costs and reduce dependency on manual labor is forcing chains to play catch up on bandwidth, according to Brendan Witcher, vice president principal analyst at research and advisory firm Forrester Research Inc. While operational technologies are a bigger priority, he added that grocers tapping customer experience tech such as automated checkouts or pickup for online orders will face an even greater need for better bandwidth."

“Trying to create things like automated checkout, mobile-enabled associates—all of this is going to lean heavily on the network,” said Forrester’s Mr. Witcher. “As grocers create more digitized experiences in their environments, bandwidth becomes a huge bottleneck.”

KC's View:

If this is a challenge for Ahold Delhaize- a top 10 supermarket retailer in the US by volume - imagine how much of a challenge it is for smaller retailers with fewer resources.