Retail Week, in partnership with DWF, has launched its first in-depth report into the UK retail supply chain sector’s state of play. Here we provide a summary of the findings.
While the world of retail evolves rapidly for all to see, supply chain teams are having to adapt at lightning speed behind the scenes.
The need to innovate to keep up with consumer expectation and stay ahead of the competition has never been more urgent. The challenge for supply chain teams is two-fold. As retailers pour resources into developing new ideas and capitalising on new markets, supply chain professionals have to make this a workable reality.
And, at the same time, they have to innovate within their own teams to keep up with the pace of change and help drive the business forward.
This year has been a year of supply chain scrutiny, piling extra pressure on the teams. The horse meat scandal has drawn fresh attention to how retailers operate, sparked a renewed focus on supply chain transparency and increased the pressure to obtain genuine end-to-end visibility of product and a truly robust supply base.
In short, demand for new ways of thinking and operating has never been more critical.
Retail Week, in partnership with law firm DWF, has produced the first Supply Chain Trends and Innovations Report, based on in-depth interviews with leading supply chain teams from a wide variety of UK retailers, and a survey with a broader spectrum of supply chain professionals.
Among the areas of retail cited as providing supply chain teams with the most challenges are technology systems and adapting the business for multichannel. The revolution happening within retail is proving problematic. Most supply chains are not geared up to cope with the pace of change and fundamental overhauls are required if businesses are to survive.
The work going on in supply chain teams is not simply a case of tinkering with existing processes. There are complete reorganisations of networks, systems and warehousing operations happening throughout the sector.
What’s clear is that the advancements in UK retail supply chains are second to none. As the logistics director of one of the high street’s biggest retailers says: “The UK is far more advanced in supply chain innovation that just about anywhere else. The competitive nature and the maturity of the UK retail market is driving that.”
Notably, the directors interviewed for this research all focused on the importance of people when it comes to making these changes a reality. Irrespective of the millions that are being invested in technology systems or warehouses, supply chain innovation and revolution will be difficult without a change in the way that supply chain professionals think and operate. More time and attention is being paid than ever before to fostering innovative ways of thinking, bringing about new ways of working and introducing a culture of collaboration - be it with third-party logistics providers, suppliers or internal stakeholders.
In addition to contending with future growth, many of the directors who took part in the research refer to the challenging issue of having to innovate while at the same time cutting costs. For many, the drive for innovation is being accelerated out of the need to trim back.
But when summarising the findings of this report, one of the most fundamental and significant factors in the way supply chain teams both think and operate today is the customer. Retailing is, more than ever, on shoppers’ terms and theirs alone. As one grocery logistics director says: “If the consumer tells us she wishes to interact with us in a completely new way, we jump.” And if retailers’ supply chain teams don’t jump quickly or highly enough, competitive advantage hangs in the balance.
What’s inside the report
Chapter 1 - Retail supply chains in today’s world The customer is the supply chain king
Chapter 2 - Developments in sourcing and supply Retailers are undergoing a complete evaluation of sourcing strategies
Chapter 3 - Logistics: fresh ways of thinking Warehouse innovation is the priority
Chapter 4 - Supply chains in a multichannel era. The pace of change is driving the agenda
Conclusion - The winners in the supply chain world Why focusing on supply chain talent has never been more important
- To download Supply Chain Trends and Innovations 2013, visit www.retail-week.com/SCR2013