Last week retail supply chain leaders from around the country congregated in Orlando, Florida for the 2019 Retail Industry Leaders Association (RILA) conference on supply chain. Retail has been in a state of change for a while now, with the more visible focus on in-store and online customer experience.
The overall ability for a retailer to deliver innovative experiences that will resonate with the customer, however, is not simply a flashy web page or fancy in-store technology. It requires alignment throughout the business, with supply chain playing a major role. We continue to hear how supply chain is not simply a cost of doing business, but an area where retailers can create competitive advantages that not only save them money but create value for their customers. When looking back at what we heard at RILA 2019, a few concepts stand out that tie into this overall theme.
Data and Analytics Enabling the Future Supply Chain
Supply chain continues to be an area where the wealth of data collected over the years can pay major dividends as modern analytics platforms and organizations are now able to dive into it and create actionable insights to improve operations. Throughout the conference we heard the great ways retailers are leveraging their data and advanced analytics capabilities to improve their operational efficiencies throughout the supply chain.
Tractor Supply Company is utilizing machine learning to determine which trailers to unload first and are pulling data from their retail point-of-sale system to fuel upstream forecasting improvements. We also heard how retailers such as Carters and Aldo are using AI and machine learning to improve their inventory placement and fulfillment for omnichannel orders. There is a clear push towards not just developing these valuable insights but using them to drive actual improvement which can improve not only the cost side of the ledger, but also drive a better overall customer experience.
The Struggle with Last Mile Delivery
Customer expectations are constantly evolving, hence the disruptive nature of retail today. Of all the chaos this has caused, one area that still seems to be lingering as a problem for retailers is the conundrum that is last mile delivery. The simple reality is that retailers need to ensure it is a positive experience for the customer, but they need to find a way to do it both efficiently and in a cost-effective manner. We heard multiple ways retailers are attacking this trend – be it mini-hubs or last mile facilities to be closer to the customer and enable quicker delivery times, or partnering with new delivery services such as the crowdsourced startup Roadie. While retailers work to figure out what options work best for their business, they have to be concerned with how last mile ties in to their overall supply chain and ensure that the experience meets the expectation of their customers.
Fostering Diversity and Inclusion in Supply Chain Organizations
Perhaps the most captivating session during the conference was the panel on diversity and inclusion led by Chief Diversity and Inclusion Officer and Vice President of Human Resources at Target, Caroline Wanga. Hearing how one of the most successful retailers of the modern age has embraced a culture of diversity and inclusion was inspiring, not just by the overall message, but with the frankness that it was delivered. Caroline strongly reiterated “Diversity and inclusion is not a moral imperative, it is how you survive today.” Speaking on how a supply chain organization should seek diversity as it will help meet the diverse needs of it’s customer base, Caroline, along with Chief Supply Chain Officer Arthur Valdez and VP of Inventory Management Gretchen McCarthy, spoke about how Target is taking concrete steps using benchmarks and metrics to improve the diversity of their team and the overall execution of their operational objectives in parallel. While all acknowledged it is by no means easy, it shows that these concepts are not just important, but vital to the success of modern brands.
Overall RILA 2019 lived up to expectations as we got to hear from retailers on the top challenges and opportunities facing their supply chains in 2019. As the retail supply chain grows more complex, innovation and emerging technology are more important in your path to meeting shopper expectations. If you’d like to hear more about our perspective on the retail supply chain, please subscribe to our insights below.