Supply Chain Management

Retail Supply Chain

 Key Issues in Retail Supply Chain
• Capturing exact customer information,
• Types of retail – Urban vs. rural, Big vs. small,
Organized vs. unorganized,
• Small shelf life – distribution nightmare,
• Quick emergence of “me too” products,
• Services more importance than products – retailer
being the buying arm of the consumer rather than the
selling arm of the manufacturer (free home delivery
etc.)
• Changing consumer – changing preferences, habits,
priorities,
 Key Issues in Retail Supply Chain
• Fragmented market, the product reaching on
time to retailer and ultimately to consumer,
• Product mix,
• Multichannel marketing,
• Mass customization,
• De-verticalization,
Key Issues in Retail Supply Chain
Capturing exact customer information:
Acquiring customer information is a major
challenge for the FMCG sector with respect to
the various customer demographics as well as
other customer categorizations. IT and its
tools that allow the retailers to understand its
customers well can to a large extent help
companies tackle the blues.
 Types of Retailers

1. Store-led,
2. Marketing-led model,
3. Supply chain-led model,
 Types of Retailers
Expanded assortments and service
e.g. specialty shops or department
stores, e.g. Marks and spencer.

Expanded assortment and/or

reduced margins/service. Such
as supermarkets, discount
houses etc.
Types of Retailers
Added convenience, higher
margins, less assortment such as
telephone, mail order, vending
machines, door to door.

Expanded assortment, reduced

margins, ore information such as
the internet.
 Product Life-Cycle Management
PLC management is an important area of focus
considering the highly competitive product
market. Collaborative forecasting and planning
effectively transforms a supply chain from a linear
process into an intelligence market place. Product
life-cycle management tools enhance product
and customer-related data management
capabilities and allow companies to more easily
share information about buying habits, customer
feedback and promotional strategies across the
supply chain.
 Product Life-Cycle Management
Benefits:
• Reduces cycle times,
• Enhances manufacturing efficiencies,
• Encourages the development of more
innovative products,
• Reduces product development costs,
 Mass customization
Mass customization is the customization and
personalization of products and services for
individual customers at a mass production price.
Traditionally customization and low cost have
been mutually exclusive. Mass production
provided low cost but at the expense of
uniformity. Today new interactive technologies,
like the internet, allow customers to interact with
a company and specify their unique requirements
which are then manufactured by automated
machines.
 Mass customization

Benefits of Mass Customization:

1. Higher profits,
2. Lower costs,
3. Market exploitation.