Retailers must find a balance in all aspects of the supply chain processes as they move forward. They must analyze the platforms and tools they have in place and identify: is this solution addressing my needs to grow my business in the current economy?
In recognizing that the supply chain model of 10 years ago is now inadequate to meet business needs, a majority of respondents in a recent survey cited that they are either in the process of evaluating their supply network, just completed an evaluation or are about to start one, according to Retail Systems Research, Miami.
Additionally, retailers must identify the data and analytics that provide them with end-to-end visibility into their supply chain model. A number of technology adoption priorities for the next 12 to 18 months include cross-channel inventory optimization; distributed order management; in-store wireless devices and applications; and integrated product catalog and product information management, the RSR Research report finds.
Yet while a number of retailers do succeed at implementing such effective strategies to grow their business from the bottom up, a number of them are still “trying to wrap their arms around the question of ‘How do we get to this data, this information?’” said Courtin. “Retailers need to get to that first step and understand what events are happening in the supply chain, how those events impact their business and how to react to things that happen that are not in the plan.”
While Courtin confirmed that such flash demand activities as “Fashion Star” don’t necessarily compete with traditional seasonality of the retail supply chain, they do promote a re-assessment that many retailers are facing with their processes today.
“These types of shows—these demand-pushing activities—are not going to make ‘Black Friday’ not what it is,” Courtin added. “What they’re going to do is allow retailers to have a new demand signal type device and in the short term, really have another data point of how things are moving and selling and how they can then re-sequence their supply chain to make it meet that demand. Secondarily—not right now but down the road—they might make demand a little bit more stable because they will be able to gather data but influence demand. Traditionally, retailers influence demand by having promotions and sales: ‘buy two get one free’ type of marketing. Now, they have another tool to do that. These flash demands will allow them to properly manage and manipulate demand better than they have in the past to really understand the cause and effect of certain activities that allow them to do that.”
The supply chain is a complex environment with intricacies that only the best-of-the best—when implementing the most effective strategies—can truly understand and excel at. Retailers must observe the global economy for signs of “flash demands” and react to them as quickly as they present themselves in order to understand the impact they can have on their bottom line and react accordingly.
“A lot of retailers are still struggling with the convergence of e-commerce, catalog sales and brick-and-mortar sales and how to converge all those,” said Courtin. “And that’s something that they are moving towards and it’s going to take time. It’s just a matter of making the right choices—and part of that is technology, part of that is the right people and a lot of it is just mentality within retail companies to be able to accept that this is where we are headed,” Courtin concluded.