Wednesday, November 5, 2014

SUPPLIERS, OMNICHANNEL, AND NEW SUPPLY CHAIN

Suppliers must also understand the new supply chain and how they must change their supply chain to be in this new environment.  It's about more than shipping products.

Fulfilling orders to ‘omnichannel’ retailers isn’t easy for suppliers

When asked to name their toughest challenge in selling to retailers, the largest group of suppliers, or 42%, cited fulfilling orders to multiple locations for retailers that sell online and in stores.
Lead Photo

As expectations rise among consumers to find what they want from retailers online as well as in any store a retailer operates, things are not getting any easier for many merchandise suppliers, a new report says.
When suppliers were asked to name their toughest challenge in selling to “omnichannel” retailers—or merchants that sell through both online and offline channels, and let customers start an order in one channel and finish in another—the largest group of suppliers, or 42%, cited the need to fulfill retailers’ orders across multiple locations and have inventory available for all of a retailer’s physical stores and e-commerce sites.
The study, “Retail Insight: Fulfilling Consumer Expectations,” was commissioned by SPS Commerce Inc., a provider of Internet-based supply chain technology systems, and conducted by research and advisory firm Retail Systems Research LLC. The study is based on a survey of 214 companies, including retailers, distributors, manufacturers and providers of logistics services.
Retailers “clearly are pushing for faster fulfillment and better visibility into inventory,” says the report, which was written by RSR managing partners Nikki Baird and Paula Rosenblum. Suppliers say retailers are also demanding more comprehensive information on products. One area where suppliers say they’re not getting requests for more assistance is in processing merchandise returned from customers.
The study, which provides several charts about trends in omnichannel retailing and supply chains, listed the following areas of supply chain services, ranking them by the percentage of companies citing each service as their toughest challenge:
Rapid fulfillment across multiple locations 42%
Comprehensive product item information 21%
Drop-shipping capabilities 19%
Accurate visibility into inventory levels 17%
Streamline returns process 1%