It’s no secret that today’s consumers are demanding. Spoiled by near infinite choice, expecting to be able to purchase anything at any time, from any device or location—and at the lowest price possible—they’re putting massive pressure on retail and CPG supply chains. Promising but vague buzzwords like AI, machine learning, and a push to “digitize” the supply chain only add to the confusion. Meanwhile, retail out-of-stocks have remained stubbornly at 8% – 15% for decades, and a recent McKinsey study found that the average supply chain has a digitization level of just 43%.
The good news? There’s an opportunity for retailers to work with their CPG partners and create a consumer-driven, digitally connected and integrated, end-to-end supply chain planning process that relieves some of these pressures. Leading companies are investing in processes and technologies to become “demand-driven”—ultimately attempting to drive all planning and execution from as close to the consumer as possible and to connect the planning process into a single, digital model of the business. The benefits are real: after overhauling its supply chain in 2015, Canadian retailer Princess Auto now consistently achieves in-stocks of around 98%, even during promotional periods.
Digitize the Supply Chain: A new resource
In our latest eBook, Flowcasting: Digitally Connecting the Retail Supply Chain—written by supply chain consultant Mike Doherty—we review leading practices for improving supply chain agility. We’ll also outline a straightforward and effective methodology for digitally connecting the retail supply chain to maximize revenue and margins while removing costs and simplifying planning activities across the entire value chain.
- How to connect high-level sales targets to day-to-day operating plans based on what is and isn’t selling
- New processes that give planners the ability to quickly update key planning information like forecasts, replenishment parameters, and more—so that everyone can see the most up-to-date plans
- How to make sure that every point in your supply chain is driven by a single forecast: consumer demand at store level or at other customer touchpoints
- How overhauling your supply chain processes can boost incremental revenue, enhance margins, reduce days outstanding and cycle time, and increase forecast accuracy up to 40%
Leah Hoffmann is BTG's Marketing & Content Strategist. A former journalist, Leah worked for Forbes.com and The Economist before joining BTG. She is passionate about clear thinking, sharp writing, and strong points of view.