By Paul Maguire, Head of Retail Delivery at Endava
The ebb and flow of stock availability has been an ever-present challenge in retail, meaning a firm grip on supply chain order management is key to keeping operations running smoothly. Beyond this, the ability to remain agile across the supply chain and anticipate unpredictable peaks in product demand has never been more important. High street retailers have long been used to reacting to emerging catwalk trends and the latest celebrity ‘must-have’ items, yet the rise of social commerce is changing the dynamics of demand.
With 31% of social media users preferring to discover new products via influencers and a growing number of in-app ‘swipe to shop’ purchases, retailers need to be better equipped for unified commerce across channels. Products can now spring into unprecedented demand, with millions of consumers rushing to get their hands on sought-after items, exacerbating any supply chain instability. And when retailers’ infrastructure fails to fulfil these orders – whether that’s anything from websites crashing to manufacturing issues and shipping delays – shoppers are left with a bad taste in their mouths.
This necessitates retailers to take a holistic view of their infrastructure, evaluating how they can digitally improve everything across all four focus areas – from their business models to their processes, domains and culture.
For example, to achieve business model acceleration, retailers can diversify their revenue streams by integrating subscription-based models or venturing into e-commerce platforms. These strategies can effectively broaden their audience and cement financial sustainability. When it comes to business processes acceleration, automation technologies can be used to streamline critical supply chain areas like order management and inventory control. Machine learning can also be used to predict demand and optimise inventory management.
Thirdly, from a domain perspective,AI can be integrated to elevate the customer experience, with tailored recommendations and interactions. Lastly, cultural acceleration is facilitated by adopting a ‘user-centric’ approach to services and developing digital tools. This ensures that both employees and customers can enjoy the benefits of a digital transformation.
It is important to highlight however that digitalisation is hardly ever confined to just one ‘type’; it typically involves a combination of all four. For instance, implementing significant process or tool changes is invariably linked with a corresponding cultural shift.
It is no secret that over the past few years, the inefficiencies in supply chains have gone from being a mere frustration to a massive headache with analysts suggesting this issue isn’t going to improve on its own anytime soon. While it will take time for global supply chain backlogs to subside, retailers can take proactive steps to improve how they manage supply chains to increase efficiency.
Supply chain modernisation through a centralised Transportation and Logistics (T&L) control tower has proven to play a particularly transformative role. This allows for end-to-end visibility throughout the supply chain and automation, meaning retailers can quickly react to challenges and prevent disruption. By using capabilities like AI, machine learning, and robotic process automation (RPA), tasks can be streamlined.
This has shown to be hugely important for retailers who want to remain competitive and efficient, as they’re able to deliver increasingly better experiences for customers. These technologies will continue to bolster and streamline the retail supply chain as they become even more sophisticated.
In the run up to Christmas and beyond, building agility into the organisation’s digital infrastructure will help prevent bottlenecks in delivering shoppers’ wish lists and get retailers poised to deliver on the latest trends.
Key tactics include gaining visibility across connected supply chain networks and shopping platforms to monitor the evolving landscape, before being able to identify areas for improvement. For example, tools such as mobile devices and inventory management software that unite data from both physical and digital environments will help retailers see the bigger picture across shopping channels and pinpoint areas for improvement.
In this new era of evolving consumer behaviours and expectations, retailers need to go beyond the traditional methods to fulfil the demands of their customers and think bigger than siloed digitalisation approaches.
What’s more, to stand out in the competitive retail landscape, especially during periods of high demand, retailers must embrace agility as a core tenant of their operations. This agility will allow retailers to be ready to adapt to unpredictable fluctuations in demand.