Harnessing Data for Effective Retail Supply Chain Management
Each year the retail industry rapidly grows, with recent statistics forecasting that global retail sales will hit $26.69 trillion by 2022. And the U.S. has been revealed as the world's top-spending nation, housing 69 percent of online shoppers.
However, with the growing demand for efficiency, speed and personalization, retailers are struggling. That’s where technological tools are an effective solution, allowing retailers to harness the power of data in supply chain management.
In this article, I discuss how retailers and suppliers can harness the power of data to improve operations and increase potential future growth and profitability.
Power of Personalization
According to a survey published in 2018, 91 percent of consumers are more likely to shop with brands that provide a personalized shopping experience.
We must look at how we can analyze data to create unique customer profiles. Key consumer data points such as purchasing history, web browsing data, loyalty programs, in-store beacons, and social media are all analysis tools that — if analyzed alongside each other — will allow retailers to provide personalized service.
Consider supply chain segmentation as a way of dynamically aligning customer channel demands and supply response capabilities to increase sales and cater to diverse target markets.
Streamlining Delivery Processes
To effectively manage the supply chain, retailers must be completely transparent and efficient to provide a successful shopping experience, from first glance to delivery.
By monitoring several sources like orders, product inventory, warehouse layout, and historical picking times, businesses are able to improve the overall picking process.
Similar to deliveries, retailers can use big data — whether internally or from a third party — to streamline their delivery processes, allowing them to meet increased demand as well as to adapt to any changing patterns.
When forecasting future sales, it’s important that any retail data provided by suppliers and customers is reliable and valuable. Retailers can look at key performance indicators such as purchase history, geography, as well as seasonal factors and time periods to map out future success.
They can also implement third-party analytical tools to integrate data from a range of systems, combined with pre-determined KPIs to help businesses uncover up-to-date, actionable insights, freeing up valuable time to be spent elsewhere.
Supply and Demand
In today’s modern and technological world, consumers are consistently found to be influenced by popular culture. One recent example of this was Netflix’s hit show, "Bridgerton," which caused searches for corsets to rise by 110 percent between December 2020 and February 2021, and wisteria plants by 300 percent.
And it isn’t just Netflix shows influencing consumer buying behaviors, with a surge in demand found from celebrity endorsement amongst many other factors.
Retailers and suppliers must monitor consumer shopping trends by keeping on top of sales and inventory spikes so that demands are met and there aren’t any issues meeting requirements for any section of the supply chain.
Vendor Management Solutions
Having the right data system in place is vital for managing vendors, especially for organizations with complex networks of vendors, which ultimately end up fostering a confusing and inefficient supply chain.
Using data allows businesses to set KPIs to track factors, such as packaging vendors, transportation and customers.
By correctly managing vendor data, you'll be able to use the information to gain visibility and insight into your business's spending habits, contracts, and time frames to improve business decisions and customer service, as well as to increase profitability.
Amanda Sinkewitz is the senior retail intelligence manager at SPS Commerce, an EDI software company, pioneering in retail automation for 20 years.