Hilary Devey: the retail demand chain
Hilary Devey, the renowned TV business guru, has joined forces with Retail Bulletin to share her views on the retail sector as part of a new regular column.
As founder and CEO of European palletised freight network Pall-Ex, Devey and her team offers logistics solutions to some of retail’s biggest names, including ASDA and L’Occitane. In her first column, Devey explores how the changing face of the high street is impacting on the supply chain.
I was recently asked if I’m a fussy shopper? Granted, I like a certain quality of product and have favourite stores, but I also like to keep an open mind and explore niche shops and boutiques. However, regardless of where I’m shopping, I always place an emphasis on customer service.
The retail experience is more than just what you walk out with in bags or have in your online basket. Good and reliable service, availability of information, as well as post-sale customer support, are integral parts of the overall customer experience. But, of course, all of that means nothing if the goods you want aren’t available in the first place.
I’m certainly not on my own when it comes to this focus on the overall customer experience and this is one of the main supply chain drivers at the moment. I founded Pall-Ex in 1996 to react to the need for ‘just in time’ logistics. It was all focussed on benefiting the retailer to help with stock overflow reduction and stock room space management. However, today the focus is very much on the ‘demand chain’ and customer experience.
The continual ups and downs of the economy mean retailers need to be more reactive than ever and make the most of opportunities. For example, if it’s predicted to be scorching weather, they need to ensure they have all BBQ, picnic and beach related products fully stocked in the high street store and a flexible and fast delivery solution for e-commerce shoppers.
For solution providers like us, flexibility is also a major requirement. Retailers are increasingly looking for options that offer timed deliveries into outlets and deliveries outside of trading hours. Each store often has different needs and demands, and the bespoke approach is certainly favoured, with different delivery and collection solutions required for each individual outlet.
Technology that enables supply chain transparency is also in huge demand at the moment, with track and trace providing a prime example.
For the online retailer, track and trace dramatically increases customer revisits, making their site “sticky”. It encourages the shopper to return to track their goods. Once back on the site, the online retailer has the opportunity to up-sell additional products based on the consumer’s buying profile.
For bricks and mortar operations, there are a variety of smart ways to exploit track and trace data to improve efficiencies across the business, ranging from improved inbound planning at DCs, all the way down stream to faster processing of vendor invoices.
There have certainly been big changes in retail supply chain requirements and there are more to come.
I believe the way the consumer uses high street stores will see a dramatic shift and they will almost become showrooms for online sites. Think ‘try before you buy’ destinations rather than places to make the actual purchase.
Rather than keeping large numbers of various different sizes or shapes in stock, the smart retailers will extend their provision to the bespoking of products at the fulfilment centre. Deliveries will become next day as standard either to domestic addresses, click and collect or the growing number of drop boxes.
This shift will inevitably put greater pressure on logistics providers. However, I believe flexibility and adapting to market demands is key to survival in this business. It’s those who aren’t prepared to change that will take the biggest hit.
