Modern Marvels: How Supermarkets Operate (S13, E52) | Full Episode | History

it's a half trillion dollar a year industry gargantuan warehouses enormous fleets of  trucks hyperproductive processing plants   climate-controlled banana ripening  wounds and computerized shopping carts   all fueled by a variety of marketing strategies   designed to keep us coming back for more  now the supermarket on modern marbles   they've changed our lives from the growth of  self-service retailing to the availability of   global foods from facilitating suburban sprawl  to creating a greater reliance on the automobile   if jazz was the uniquely american contribution  to music the supermarket is the uniquely american   contribution to shopping it was invented  here and spread very quickly around the world   supermarkets are basically super-sized  grocery stores that are departmentalized   and offer a wider selection of food along  with household merchandise and services   the traditional supermarket design occupies  a large floor space on a single level   and usually has the convenience  of an expansive parking lot and longer if not around the clock shopping hours   fiscally they must bring in two million  dollars a year to qualify as a supermarket   today we have about 34 000 supermarkets  they would do 480 billion dollars in sales   the average supermarket would be a median size   of 48 000 square feet and they would carry  about 45 000 different products in that store a supermarket is often part of a chain that owns  or controls other supermarkets located in the   same town or multi-state region this increases the  opportunities to offer lower prices made possible   by volume sales on the wholesale and retail levels  they've also had a big effect on food safety   they can't afford to have a thousand stores go out  of business because something wasn't clean or they   didn't follow sanitary conditions their really  have one of the best food supplies in the world   as shoppers travel up and down the  aisles of their neighborhood store   they are for the most part unaware of the massive  behind-the-scenes operations it takes to keep a   steady supply of everything from apples to ziploc  bags streaming to each of the stores in the chain   i always say that when you go into a  supermarket it is the tip of the iceberg   safeway is one of the largest  food retailers in north america it operates over 1700 stores in the western  and mid-atlantic regions of the united states   and in western canada to support its stores safeway has invested in  extensive distribution and transportation systems   to continually resupply our stores in canada and  the united states safeway currently operates the   12th largest private fleet in north america  with over 1100 tractors and 4 500 trailers we travel approximately 85  million miles a year deliver   475 000 truckloads of product  to our retail stores every year most of the fleet is outfitted  with 64 000 btu refrigeration units   capable of keeping a trailer hauling  frozen products at minus 20 degrees and the trucks are equipped with onboard  computers the onboard computer tells the   driver exactly where he is to go what story is  to go to how many pallets of product he used to   deliver at each store the onboard computer  also provides a driver with a method to   track dot hours of service which is required  currently by the department of transportation to service its truck fleet some  of safeway's distribution centers   have their own maintenance areas  fueling stations and automated truck washes safeway operates 13 distribution warehouse  centers in the united states and four in canada   one of the company's newest centers  located in auburn washington   services its stores in the  northwestern united states   the sprawling 116 acre complex includes  administrative offices a recycling center and two enormous warehouses   surrounding the buildings is just over two million  square feet of nine-inch thick concrete paving   to provide a durable surface to  handle the heavy truck traffic the largest facility is the grocery warehouse inside are nearly three miles of shelving filled  with product ready for shipment this particular   building is 518 000 square feet holds about 44  000 pallet positions and typically will ship in   the neighborhood of around 2 million pounds  a day we typically have two shifts that are   picking products and shipping to our stores we  deliver on a 24-hour basis seven days a week an army of forklifts load incoming pallets  on the shelves and make sure the ground   level has product available for those who  are putting together the outgoing orders those responsible for order  fulfillment are called pickers the headsets the pickers wear are part  of an interactive computerized system   designed to make assembling an order more accurate the voice selection technology is a technology  that has taken the place of the old paper list   of the things to pick on a pallet to go to a  store it delivers the list of things via the   headset to the order picker the computer  just told me to go to slot 444 of five so i pull up to the slot slot location  444 confirmation number 44. peter tells me   to pick one item so i pick up one  item and i tell the computer one four five one my computer then  tells me to go to the next   location all the vehicles used in  the warehouses are battery powered   so it was necessary when designing the buildings  to set aside space for large recharging rooms the building that serves as the cold  storage and perishable warehouse   is one of the largest in the nation the powerful refrigeration equipment keeps  the different rooms at specific temperatures the coldest is the frozen foods warehouse  that is maintained at 15 degrees below zero   produce is kept in the low 50s bananas are picked and shipped green and need  some special handling so safeway built 12 banana   ripening rooms in the warehouse each one can  hold up to 1 000 40 pound boxes of bananas by controlling the temperature and humidity in  each room safeway can speed up or slow down the   ripening process to keep pace with consumer demand  we're essentially trapping the gases the same way   you would trap the gasses in a paper bag with any  type of fruit and facilitate the ripening process   this technique eliminates the need for unboxing  and re-boxing this easily bruised fruit   resulting in significant savings  of time space and labor costs among the produce and groceries distributed  to the stores of major supermarket chains   are a selection of products  they manufacture themselves safeway's bakeries get an early start  to mass-produce a fresh supply of bread   at the facility in bellevue washington white  flour is brought in by the train carload   presently we are in our bulk  storage area this tank here holds   110 000 pounds of flour from this  tank we blow the flour into a sifter   from this sifter the flour goes to the  mixer where we use it for making bread   once the flour is mixed with the other ingredients  the dough is cut into appropriate size pieces shaped and put into baking pans then it  travels to the proof box so the dough can rise   once the bread comes out of the proof box we go  on this conveyor into the oven where it's baked in   the oven it can take anywhere from what 19 minutes  to about 24 minutes depending on the variety after   the bread is baked it's cooled for 60 minutes  the bread is cooled now we are slicing it here   after the bread is sliced we put  it in a bag bag is opened with air after the bread is in the bag we enclose it   as you can see with a little quick lock the  whole bread process takes about three hours and   right now we are producing about six thousand  loaves an hour and that's the bread business another line of product many chains package under  their own brands is dairy at safeway's bellevue   milk plant truck after truck arrives filled  with milk purchased from local dairy farms   you're looking at a scene where we're pumping uh  7 000 gallons of milk into these silos behind us   these storage silos hold upwards of 60 000 gallons   we're looking at a storage capacity of a  quarter million gallons of milk for the day inside the first step is to pasteurize  the raw milk by raising its temperature   until harmful bacteria and other  unwanted organisms are killed   then it's processed into a variety  of milks whips and half and half since the plant outputs so many gallons of  milk a year safeway decided to install an   assembly line to blow mold plastic gallon jugs  on site at a rate of over 2 million per month once they're trimmed they travel across  the building to be filled with milk our plant has the fastest gallon filler  in the country runs in speeds of 160 a   minute it'll fill a truckload  of 4200 gallons in 22 minutes   the bellevue plant also produces 20 million  pounds of cottage cheese a year the process to   make lucerne cottage cheese is to fill our bats  which holds 50 000 pounds of skim milk heat the   product up add bacteria and separate the whey from  the curd from there we pump the curd up to mixers   and we make our four percent all the way down to  our fat free looser and cottage cheese from there   after it's mixed it goes into the packaging to  cold storage and outdoor distribution channels in an adjacent building is an ice cream plant  it's one of the largest in the united states   there are two assembly lines  to fill gallon containers   one designed to handle round cartons  and the other to fill square ones both of the lines output one  gallon of ice cream per second   adding up to a total of 18  million gallons per year the facility also manufactures  a variety of ice cream treats   one machine puts together ice cream  sandwiches at the rate of 1800 per hour this assembly line produces  350 stick bars per minute safeway manufactures between  40 and 50 million bars per year in addition to the items supermarket  chains produce themselves   and other domestic products foods from around  the world are a common part of the vast selection   fresh produce on display in stores may  have been picked on another continent   and cheeses from france are sold  alongside those from a local dairy the equipment the entire grocery industry needs  to warehouse transport and display perishable   and frozen foods accounts for about one-third  of the total u.s energy use for refrigeration   this gigantic enterprise had to start  somewhere and a big king and a little   pig did their part to make supermarkets  the nation's supreme suppliers of food supermarkets may have played a vital role in  the development of our modern suburban lifestyle but providing an adequate food supply has been an   essential element in the success of  cultures throughout human history we can't get along without it we can't  transport without it napoleon says an   army moves on its belly so this has been a  key ingredient to civilization and society wherever major cities developed street  vendors stores and markets flourished   to supply the urban population so far removed  from the self-sufficiency of farm life during the settlement of north america by  europeans trading posts were some of the   first retail establishments they made available  foods that people couldn't grow or hunt themselves   including sugar and coffee plus  basic supplies like blankets   as more people settled into an area larger retail  businesses known as general stores appeared they sold a wider variety  of foods and canned goods   along with just about everything  else for the home or farm as urban populations grew  stores became more specialized   and usually neighborhoods had their own  butcher shop bakery and grocery store by the beginning of the 20th century the  great atlantic and pacific tea company   or a p had become america's first major chain of  grocery stores shopping in a store 100 years ago   was very different than it is today stores were  set up with clerks who did all the work all the   customer had to do was walk in the store hand the  clerk of list of items that were to be purchased   the customer's not allowed behind the counters and  the clerk would select the items for the customer   in the early 20th century clarence saunders  a grocery store owner in memphis tennessee   felt that having clerks gather up each  customer's order was too labor-intensive today at the pink palace museum in memphis  is an exact replica of his creation   that revolutionized the grocery industry the first  successful self-service grocery store no one seems   to know why he named his store piggly wiggly but  customers flooded in when it opened in 1916. and   there were innovations that customers would see  that would really influence their shopping habits   the first is the turn style once you went into the  store you couldn't get out until you finished your   entire trip to the store the second was a shopping  basket shopping baskets allowed the customer to   pick up the produce and the and the materials  and to put them in the basket themselves one of   the most important ideas of clarence saunders  was the use of price tags for the first time   customers knew exactly how much their products  cost they could select the quality of the goods   that they wanted to buy put them in their basket  and go through the store and continue shopping   piggly wiggly stores multiplied as other grocery  store chains adopted the self-service format   but it would be more than a decade before  the larger supermarket format made its debut today on new york's long island  there are 45 stores of a family-owned   chain of supermarkets named king cullen  according to the smithsonian institution   these are the direct descendants of the  first true supermarket that opened in 1930.   it was the brainchild of michael j cullen  who had first come up with the idea while   working for a p and kroger in a letter to  his employers he outlined the concept of a   bigger store in which lower prices would  be offset by a higher volume of sales   michael cullen my uncle sent this famous  letter outlining his vision of a supermarket   and of course they didn't do anything with it  so mike moved to new york and teamed up with   a wholesaler who gave him an advance to start  this first supermarket which he did in jamaica   long island in 1930. his timing was perfect  by 1930 most households had an automobile   refrigerators were becoming  a standard home appliance   and america was sinking deeper and  deeper into the great depression lower prices were a welcome relief mike was a  great promoter and his two big slogans that he   used and he used them quite effectively put him on  his stores in his ads one was the world's greatest   price record and the other is why pay more and he  pounded those home consistently by 1936 there were   17 king cullen supermarkets doing approximately  six million dollars in business annually   retailers who had held off on adopting  the concept thinking it might fail   finally realized that supermarkets were the future america's entry into world war ii widened the  supermarket's place in the food retailing industry during the first three years of the war  thousands of grocery stores which were usually   small family-run businesses had to  close their doors when the head of   the household went off to join the armed  services or work in the defense industry   world war ii was really a coming of age for  supermarkets because they were changed because   they were multi-store operations losing one or  two people didn't put the chain out of business   in fact they kind of endeared themselves  to women in america by hiring them and   having them working in the supermarkets  during these really difficult times   at the end of the war supermarkets were  in a perfect position to benefit from   the period of unprecedented prosperity  and growth that followed in the 1950s   they became symbolic of the american way of life  in the late 1950s leaders from all over the world   queen elizabeth specifically and nikita khrushchev  specifically visiting america and the thing they   all wanted to see when they were here was a  typical american supermarket it was a symbol of   the benefits of our economic system to the average  citizen day in and day out week in and week out   by the 1960s supermarkets were responsible for  more than 70 percent of american grocery sales   this kind of success spread intense competition   in the 1970s many supermarket chains opened  larger stores with additional non-food   items in response to the increasing number of  low-priced discount stores including walmart then in the 1980s warehouse stores began to  appear proving people were willing to buy   in bulk size in a more industrial  looking environment to save money supermarket owners converted some  of their stores to this format   supermarkets have continually restructured  to keep up with changing consumer desires   in reaction to modern life's busy  schedules prepared meals departments   are becoming increasingly important  and being given more floor space many supermarkets are targeting particular  groups of customers like those interested   in organic foods or specific ethnic groups  or immigrant populations over 30 percent of   all new supermarkets under construction in the  united states are aimed at hispanic customers   but the evolution of supermarkets  has always reflected societal change   and that evolution has always been  facilitated by new technologies   when in a supermarket we're always  one step closer to the future owners attempts to make customers visits  to supermarkets as accommodating and   efficient as possible have led to many  important innovations over the years   some have been so successful they  spread to other retail applications perhaps the most widely used and copied is the  standardized barcode known as the universal   product code or upc each product is assigned a  number which is represented by a set of lines   and spaces of varying thicknesses scanners using a  laser or digital camera are used to read the codes   supermarkets were the first to use  the system at the retail point of sale   ibm's first systems that were able to process  barcodes were the ibm 3660 supermarket system   which consisted of a controller registers and  scanners and these systems were first shipped   in july august of 1974 the use of barcodes  revolutionized both the checkout process   and inventory management as the system checks  you out it's not only calculating your prices   but it's also writing down every item that  goes out of the store so at the end of the   day the retailer knows every item that went  out so that he can reorder automatically   the data collected serves many purposes including  analyzing store traffic patterns to better plan   store staffing needs what may be the most  important shopping aid ever invented the   shopping cart was created back in 1937 by sylvan  goldman a supermarket owner in oklahoma city   he had noticed shoppers struggling with the metal  shopping baskets they carried through the store   then a folding chair in his office gave him  an idea it could be mounted on wheels and   the seat could serve as a platform for the  shopping basket after some more tinkering   on prototypes goldman decided to provide more  storage space by having double decker baskets   once he manufactured his carts he still  had to convince the public to use them   people walking into the stores would tend  to say one of two things if it was a woman   she'd say i've been pushing a baby carriage  so long i don't want to push another cart   if it was a man he'd say don't i look muscular  enough to carry one of these little baskets around   sil goldman actually had to hire shoppers around  the front of the store to push these cars with   products in them and then a lady at the front of  the store when somebody came in would say well   hey look everybody's using the cart why not you  it would be another 10 years before the typical   shopping cart we know today appeared a larger  single basket replaced the double-decker basket   and by redesigning it so that the back end would  swing one card could be pushed into another a   supermarket could have hundreds of them in a very  small area not take up space that could be used to   sell products but it did more than that it made  it easier for parents to bring their children   shopping not only that it provided them a space  to put heavier items not only that it provided   advertisers a place to remind consumers  every second that they're in the store   of their products today's low-tech shopping  cart is getting some high-tech additions where shopping cart theft is particularly frequent   some stores have invested  in electronic locking wheels the wheel locks are triggered when they  pass over a wire emitting an electronic   signal that is buried just under the cement  or asphalt along the store's property line and the ibm industry solutions  lab in hawthorne new york   has been working on a wireless touch screen  computer to smarten up the carts when you   walk into the supermarket you take this out of  the charging rack and you place it on your cart then what you do is you take the scanner you  scan your loyalty card so it knows who you are   i then hit start shopping  and i begin my shopping trip   as i go through the store i'm able  to scan my items and bag it as i go the ability to scan selections and keep a running  total is only one of the computer's functions   customers can enter their shopping list via the   internet and the computer will tell  them where the items are in the store it also lets you know when  your deli order is ready   and it offers recipes and personalized coupons and because the customers  scan and bag as they shop   checkout only involves payment  of the already established total another innovation ibm has created is veggievision  it takes the guesswork out of pricing fruits and   vegetables by using a digital camera to capture  an image of the object placed on the scale   so it can be visually compared to a database  of stored imagery what veggievision does is it   has a visual recognition system that looks  at the hue the saturation and the intensity   it's looking at the segmentation so the lightness  or darkness of that fruit or vegetable and finally   the features the texture curvature and width it's  making an analysis and recognizing that it's a   tomato so now all you have to do is print out a  barcode tag and you're ready to leave the store   as the number of self-checkout lines increases   technologies like veggievision may become an  important part of supermarket modernization   but there's another technology under development  that could do away with checkout lines all   together this is the future of item tagging this  is an rfid tag radio frequency identification tag   it consists of an antenna and a microprocessor it  essentially carries the same information and more   as a barcode does today when these tags become  cost effective and all items are tagged with rfid   tags when you go shopping your checkout operation  will be much faster you will gather your items   pass them across a scanner or walk through  a portal and your transaction is done once rfid technology is  perfected for use at checkout   it will be possible for a  customer to simply leave the store   all of the tags on the items in the cart will  be read along with the customer's credit card   which will have rfid technology as well the  total will be charged directly to their account already in place is another technology that makes  it possible never to set foot in a supermarket   the internet new york city with its concentrated  population was the perfect proving ground for an   internet grocery company called fresh direct  here's how it works the customer places their   order online at the freshdirect website when  all the orders are done being placed today   we begin picking the produce and getting all of  the other items that our customers have ordered   organizing boxes in our 300  000 square foot facility   there are miles of conveyor belt  and at the end of the process   there is 130 refrigerated trucks that deliver  the product into the city and into the suburbs supermarkets have always relied  on technological innovations but maximizing sales also depends on employing  some of the social sciences especially psychology supermarket owners give much thought  to how to get people into their stores   and encourage them to become loyal customers   location is obviously a primary factor  and so is the promise of low prices there are two basic pricing strategies  supermarkets typically use to convince   customers they're getting the  most out of their food dollar   one they call everyday low pricing edlp edlp  is really a model that says let's try and find   what the lowest possible price is  let's sell it that way all the time   the other is called high low high low is  where they really try and put some products   on promotion that are just incredible incredible  values and they use these to bring customers in   who buy the full basket of products which  include products at their regular levels   beyond pricing strategies supermarket  owners have done a great deal of analysis   in determining how the layout  of the store impacts sales first impressions are important and stores want  to appear clean and filled with fresh foods   so owners often place produce sections  at the entrance of their supermarkets   many stores have installed tungsten rather  than fluorescent lights over the produce   department because it helps make the fruits  and vegetables look brighter and more colorful   almost all supermarkets place the frozen  foods in the aisles nearest the checkout   to minimize thawing but there are several reasons  why most supermarkets have the perishables around   the perimeter and the dry goods and household  items on the shelves in the center of the store   refrigerated cases need to be where they can  get to the equipment that runs those cases   the dairy case or the frozen cases or the  meat cutting room so part of it's practical   but this arrangement is also how shoppers prefer  it in 1964 department of agriculture studies   found that if the perishable items  were placed in the center aisles   instead of around the periphery of the store there  was a decline in the number of items purchased one reason why commonly purchased products  like milk are placed in the back of the store   has to do with marketing strategies to maximize  sales the idea that a supermarket would have   in strategically thinking about what its  layout is is to make sure that the consumer   sees as much of the product as possible  and so there's a couple things that you   would want to put far away from the door  and milk is usually the example given   there are many marketing strategies that dictate  exactly where products are placed on store shelves   there have been a lot of studies done on shelf  placement and it is obvious that eye level   at female eye level i think is about 54 inches or  something like that and male eye levels a little   higher is the premium place so vertical placement  on the shelf makes a huge difference and marketers   who are marketing to children because children  can be very influential decision makers in the   supermarket will tend to put items that  might appeal to children sugared cereals   candy at the kind of level that a kid might see  it certainly makes sense that you put the best   products at eye level the most famous brands want  to be at eye level but there's a better spot the   better spot is right at the end of the aisle in  the industry we call them end caps as they say   pile it high and watch it fly one of the things  that they know is that you're going to spend   some time at the checkout counter and looking at  items you know to entertain yourself while you're   sitting there waiting and so they tend to put  impulse type items right at the checkout counter supermarkets also pay a great  deal of attention to atmospherics   the things that affect customers visual  auditory and even all factory sensations   we're seeing all the major supermarkets with fresh  bakeries and it has two advantages number one   is it's an opportunity to sell product  number two it's an opportunity to send   that bakery aroma throughout the store and so  when people walk in saying i'm not that hungry   they get in the front door and they say i am  hungry which translates into what can i buy now   the evidence on music shows that soothing  music slow tempo music makes people stay in the   supermarket longer and that makes a difference  softer lighting will make people stay in the   supermarket long where harsh lighting tends to  make people just want to rush and get out of there   there's also uses of colors there's a  general sense that blues for example are more   pleasant and people like to stay around and  will perhaps buy more in a blue environment   so while the usual goal is to  establish a calming environment in new york and connecticut stu leonard  stores have their own unusual environment   the audio animatronics costumed characters  and general ambience of a county fair   have made these stores a  favorite family destination the mix of good food and theme  park style fun is paying off there are only three stu leonard stores so far but  with revenues hitting 300 million dollars a year   expansion is in the works standing out from  other stores has become very important in   this highly competitive business and there is  one chain that has become hugely successful   by standing out because of the unique foods it  carries natural and organic a growing percentage   of the public interested in eating healthier more  and more supermarkets are carrying natural foods   but one large and successful chain  has built its reputation on it   whole foods you'll even find a store in the  pricey real estate of manhattan's columbus circle   whole foods now a fortune 500 company has worked  hard to transform a trip to the supermarket into a   favorite destination while offering food and other  products its customers feel good about purchasing   when you walk through the door it is  like a filter that nothing in our store   has artificial colors flavors and preservatives  whole foods began in austin texas back in 1980 when health food was still  considered counter culture   the history of whole foods market interestingly  enough was the merging of three small hippie   health food stores into one big hippie supermarket  owned by john mackey craig weller and mark skyles   john's vision from that day and why he was  in the business really still permeates the   company today as ceo he's mission driven  like he was in the very first store   just a few blocks from where the  original whole foods market opened   more than a quarter century ago are  the company's corporate headquarters   at the base of the office building  is the chain's biggest store   eighty thousand square feet  of specially selected foods   presented in an upbeat  state-of-the-art shopping environment their proactive approach to marketing  often begins even before entering the store i'm roasting hats chili's from hatch new mexico   and the smell of these roasting peppers is going  to waft in through the store down that escalator   through the parking lot and people are going to  come across here and say what is that smell that   opens the door for me to offer them opportunities  to taste new things that they never had before and of course we do a lot of tasting in the store whole foods has staked its reputation on  their commitment to quality natural products   while the higher costs have led to the nickname  whole paycheck the company feels their customer   loyalty is built on the philosophy behind their  motto whole foods whole people whole planet   organic is simply a sustainable farming method  that leaves the land as it was it doesn't take   away from the land that it was grown in  and because of that the land will be vital   for the next 20 50 hundred years  and beyond whole foods believes   that being concerned about the food supply  doesn't have to result in a dreary diet   a vast selection of wine a super chilled  room filled with domestic and imported beards   exotic cheeses and tantalizing desserts are just a  few ways to over indulge in this foodies paradise   here we have our chocolate  fountain here at whole foods market   it has about 30 pounds of chocolate in it  that circulates through it the entire day   and i'm gonna dip for you some triple cream  brie we'll dip anything from strawberries   potato chips hatch chilies to cheese  just about anything the customer wants whole foods augments the customer service in its  flagship store with a variety of technologies   there are digital billboards across the front of  the store delivering store and community event   information computer stations and multiple touch  screens throughout the store offer price checks   product information recipes and store maps all of  these along with the refrigeration and lighting   gobble up power but whole foods has found a way  to maintain its eco-friendly values we buy energy   efficient uh lighting for the most part and and  and we have controls on our on our lighting system   that uh bring our lights up and down uh at this  store depending on the sunlight that's outside   uh to help control energy costs in the store  and also whole foods market is uh the number one   purchaser of wind energy in the country corporate  virtual wind energy so we're very proud of that whole foods like other supermarket  chains has risked billions   betting on the right formula in  this highly competitive business   but oddly customers have also been rediscovering  the simplest and oldest style of shopping for food the street market   according to the department of agriculture  there are currently around 4 800 farmers markets   operating in the united states it's interesting  to think that the things that were time consuming   and a chore and nobody wanted to do in the 30s now  we've evolved to the point where they're kind of   fun and maybe a little bit of luxury and we will  spend some time in these these kinds of markets   but of course there's more to  modern life than fresh produce   so when it comes time to stock up on everything  else from canned goods to kitty litter   not to mention paper towels soft drinks  and light bulbs the odds are you'll head   back to the place where you know you'll find a  never-ending supply your neighborhood supermarket you

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Id: 21FOQWtbyuA

Length: 43min 51sec (2631 seconds)

Published: Thu Jan 21 2021