The retail business environment is rapidly changing as consumers utilize technology to make new demands on the retail enterprise. Mobile smart phones bring an “anywhere, anytime” dimension to retailing on top of established e-commerce conventions. Consumers expect they can order a product online on an impulse and pick it up at a brick-and-mortar outlet over the lunch hour. Retail innovations to meet these new demands place new multi-channel requirements for order fulfillment on the supply chain. Real-time data is now the lifeline of all kinds of retail operations and the supply chains serving them.
Making these innovations transparent to the consumer requires dramatic changes in inventory management, distribution network design, store operations and the entire nature of warehouse management. The line between the back end of the warehouse and the back room of the retail storefront blurs. At the warehouse front end, the entire supply chain must be integrated into this new reality.
Meanwhile, the need for data, driven by several factors, continues to rise. Regulatory regimes and corporate risk managers attempt to get ahead of the potential risk in real-time global supply chains to protect consumers and reduce liability. Traceability, a particular concern for commodities such as food supply, pharmaceuticals or even automotive sub-assemblies, drives new data requirements for many items in the supply chain. Nobody wants to be the bad link in the chain when a profound defect that potentially costs lives is discovered. Because goods are in constant motion around the globe today, it is vastly more complex to isolate problems when the unthinkable happens and trace the roots to the source.
Organizing that complexity is one goal of the GS1 initiative, a global effort to standardize product-marking conventions to improve traceability and efficiency. It is bar-coding at a global scale, determining how a wide variety of information is encoded into package marking and shared between trading partners. Numerous industry-specific efforts—food service being one of the highest profile ones—have been spawned to tailor those conventions for the particular needs of goods traveling within specific supply chains. Leveraging the GS1 standards effectively is both an opportunity and a challenge for many industries in the coming years. And the entire supply chain must raise its game to stay competitive.
Real-time operation enablement
The warehouse provides the intersection point for retail innovation and transportation logistics. It is a critical enabler of retail innovation and supply chain management efficiency. Real-time operation spells the difference between a satisfied digital consumer and a missed sale opportunity.
On the warehouse front end, transportation logistics have to be more tightly integrated into warehouse execution and inventory management. Real-time yard management serves as the lynchpin between an increasingly visible and connected transportation world and the warehouse. Real-time management must be built into the process at the first touch, scanning goods and moving them to the appropriate warehouse location quickly while updating the enterprise in real-time. Warehouses must deploy robust implementations of the GS1 standards to ensure that any package entering the warehouse is properly bar-coded by the supplier. This product data feeds the real-time systems all the way to the retail floor. Potentially augmented with RFID tagging, enhanced traceability drives efficiency, velocity and cost savings that accrue to the overall supply chain for a more responsive retail environment.
On the retail side, consumer demand for a seamless multi-channel shopping experience drives a new level of integration between the warehouse and the storefront. The warehouse’s role grows beyond inventory restocking to mission-critical demand fulfillment. Warehouse operations are now directly involved in providing a satisfactory consumer experience. This drives huge changes in an environment that not only must operate in real time, but do so without errors. Warehouse planning takes on new urgency as managers must stay months ahead of changes in the retail environment so that any process change can be executed initially without errors.