FreshFoods Grocers
FreshFoods’ leadership believes the operational challenges might not be uniform across the chain. Bain performed a regional analysis to pinpoint where inefficiencies are concentrated. Each region has roughly a similar number of stores, but the Midwest region differs in a few important ways: many stores are older, located farther from distribution centers, and face more frequent weather-related disruptions that affect deliveries and cold storage reliability.
Review the chart below, which compares FY2022 and FY2023 sell-through rates by region. Identify which region is driving overall underperformance and discuss why it might be struggling relative to others. Then suggest what actions could mitigate these risks going forward.
Case Exhibit
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The Midwest region is the main source of underperformance, with sell-through dropping from 90 to 70 percent. Causes are likely structural and process-driven.
1. Store Infrastructure
• Older refrigeration systems fail more often, leading to higher spoilage.
• Redesign store layouts to shorten restocking time and limit backroom storage.
2. Logistics and Distribution
• Long distances from a single distribution center cause delays and temperature fluctuations.
• Consider a regional cross-dock or partner DC to shorten transit time for perishables.
3. Store Management Practices
• Inconsistent inventory rotation and weak waste tracking inflate shrink.
• Standardize store-level procedures and link manager incentives to waste reduction.
Together, these fixes target the largest operational gap and create a template to improve performance chain-wide.
