It can’t be denied that technology is becoming of greater significance to the retail sector – especially with the world becoming more digitally driven each day. But how has it affected the supply chain specifically? Read on as we explore how technology has transformed and helped businesses maximise their supply chain efficiency, including making deliveries speedier and keeping up with fluctuating consumer demands.

The expectation of our customers

With the advancements in technology, consumers are beginning to expect the same level of service they can get online in store – which is posing new challenges for businesses in this sector. But how do they deal with this growing problem?

There are many areas where retail businesses can improve, and consumers know it. When they’ve received one service from a business, the bar is raised, and they expect that all their other favourite brands will do the same.

If you look at delivery for example, shoppers now expect a next-day service accompanied with a tracking number for their parcel.  For businesses, this means that an efficient supply chain with a well-managed inventory tracking system is essential. And, when it comes to getting in touch with the business, customers expect instant contact through the channels that they’re most used to — Twitter, Facebook and instant messaging platforms.

The beginning of the supply chain

All products must be brought to life before heading out to a customer, from dresses to smartphones. In the Digital Age, more products are being tailored to the buyer due to their love for personalised purchases. But, as they still expect a speedy delivery, manufacturing and delivery must be efficient. How has technology created more of an efficient supply chain?

Information is key to progression in the retail industry, and cloud storage has allowed this sector to store data wirelessly and efficiently. This prevents delays involving computer crashes and data loss.

Have you heard of the 3D printing craze? The process of 3D printing is what people are referring to as a form of ‘additive manufacturing’.  This is where there are no wasted raw materials. Through this technique, this type of printing is able to create products with time and material efficiency.

You may also know that the manufacturing process has became quicker, as advanced machinery can run at all times – meaning products can constantly be made and retailers can keep up with the demands of the public. When it comes to tailored products, this means that they can be created on demand, providing an efficient creation and delivery service.

Does artificial intelligence play a role?

Believe it or not, artificial intelligence (AI) has become a hit with retail businesses. In fact, according to 2017 findings by McKinsey & Company, taking an AI approach to the supply chain could reduce forecasting errors by up to 50% and overall inventory reductions of between 20% and 50%. This sort of technology can think and learn like humans, reacting to stimuli often without human input, too. In the supply chain, AI is able to assist with packaging, research and development, and inventory management which can help make the process more efficient.

“This is especially important in the case of industries like fast fashion, where user tastes change very quickly, and supply chains are usually slower to react. In such scenarios, having a direct link between the actual data being gathered from users about their tastes and what they’re interested in — and conveying that back up the supply chain — means that designers and developers in the business can come back with the right products, in much shorter lead times” was one comment made by Sangeet Paul Choudary, founder of Platform Thinking Labs.

AI helps with this, as it can predict which products will be popular through gathering customer insights and forecasting data. Machines with AI abilities can also gather information on location so that warehouses in certain areas can stock more of a product that’s popular in the area. This goes on to improve delivery times and customer satisfaction.

When it comes to problems across the supply chain, the majority come down to human error – but this can be avoided. AI can eliminate this by keeping track of stock digitally and reporting back to a data handler. This process removes the potential error of miscounting inventory or recording inaccurate information, which could then go onto lead to the wrong amount of stock being replenished.

One brand that has invested in its own supply chain is QUIZ – with results allowing them to expand into men’s fashion with QUIZMAN. The brand says that its 180,000 sq. ft distribution centre in Glasgow provides “a strong platform to support future growth”. The company also uses insights and live data on product performance to allow “informed key buying decisions to be made quickly”. QUIZ also implements a test and repeat approach to its supply chain so that it can “introduce new products, such as blazers for men, to stores and websites within weeks of identifying trends and reorder successful products quickly.”

When looking at the statements above, it won’t be long until other retail businesses follow suit.

The impact on staff members

Technology implementation across the workplace has always been a worry for business staff, with many believing that their job may be in jeopardy.

It must be reported that in some instances, software has replaced the requirement for physical workers. At Amazon, for example, employees who were once in charge of securing multimillion-dollar deals with brands have been replaced with software that can predict exactly what shoppers want and how much should be charged.

However, there is another way to look at it. The huge warehouses that store products require people to manage them. For example, when John Lewis opened two new distribution centres in Milton Keynes in 2016, 500 new jobs were created as a result.

You must consider your employees heavily, but you must know that decisions do come down to the job roles your business offers – is there still a need for certain ones? Computers can’t offer compassion or understand clients’ needs in the way that humans can, for example. And people are still required for product delivery, as well as for offering after-sales services.

What does the future look like?

Businesses across retail will begin to look over their current supply chain procedures and look at what could be improved to streamline the consumer’s experience. When it comes to AI, any platform that has access to customer insights and data has the ability to connect directly to manufacturers to integrate and better inform the process.

If retailers are short on space, but want to offer a great delivery service, greater warehouse space could be an option. As more people want the same amount of choice at a higher speed, this means that warehouses must stock a wide range of sizes, colours and styles at each of their locations — in close enough proximity to anyone who orders. In fact, there are already massive distribution centres, equal to the size of a town, which logistical networks that pick products from the shelves and send them on their way to customers.

Intelligence infrastructure is another area that should be looked into. This could be autonomous electric vehicles that operate through the night, and intelligent algorithms that can predict the most efficient routes for customer delivery.


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