The changing retail landscape requires adaptation and flexibility to meet new challenges.
Inventory accuracy and visibility in real time has been a top internal challenge for retailers, but this year, RSR Research has found that retailers are finally getting a handle on it to meet today’s Omnichannel requirements. In their report, “Supply Chain Execution: New Challenges Demand New Solutions,” RSR found that approximately half of all retailers now say they are “very confident” that they know where their inventory is at any given time.
In fact, the report found, “Retail Winners” (over-performers) have invested more time, energy, and technology in order to ensure confidence in the currency and accuracy of their inventory. This also benefits the consumers, since such efforts are designed to expose inventory that is available-to-sell to digitally-enabled shoppers while also optimizing customer service without overloading inventory stocks. Modern technologies like RFID-tags and more traditional means like frequent updates of central stock locator databases from operational systems have helped to boost system-wide inventory visibility for the majority of Retail Winners identified by RSR.
For the study, researchers surveyed 99 qualified retail respondents, 92 percent of which are headquartered in the U.S. The results revealed both supplier pressures and competitor pressures among the supply chain challenges faced by retailers. And, according to the report, “Winners emphasize getting closer – and faster – to customers. But they also value moving beyond relying on reactionary measures to meet consumer demand – by better identifying sources of demand upstream. They value this at nearly 2x the rate of their colleagues.”
Brian Kilcourse, managing partner at RSR Research, said that the study also revealed that “more merchants of highly replenishable fast moving products – grocers, drug stores, and general merchants – have achieved a higher level of inventory visibility throughout the supply chain than have their counterparts in fashion and specialty.” This finding counters what is often assumed, that GMCG and GM retailers actually report a higher level of confidence in their accurate inventory visibility as it moves through their enterprise than their Fashion & Specialty retail counterparts.
The report also provides several critical recommendations for retailers determined to get ahead of their supply chain challenges. These include:
Ultimately, the report concludes, “If you don’t know what you have, where it is, or how you can get it, nothing else really matters. Not price, not product mix, not even the shiny stores or sexy mobile sites you’ve managed to convince a consumer to visit.”