Supply chains have faced significant breakdowns in recent times not only due to Covid, but extreme weather events and recent geopolitical tensions. So it comes as no surprise that almost four in 10 (39%) retailers in Asia Pacific cite supply chain issues as one of their major concerns, according to recent research from Statista.
However, the most impactful disruption has gone largely unnoticed – consumers now hold the balance of power and their choices will make or break companies. From those surveyed by Danish integrated logistics company, Maersk and US media company, Bloomberg, almost three-quarters (73%) of executives agree that the power to dictate market growth lies with consumers rather than the companies and 91% agree that continuous change is essential to growth.
Retail supply chains must embrace this consumer-driven business model by being nimble, offering a clear view across business functions and focusing on operational efficiency.
In its recent report, ‘Refocus your supply chain to take the lead’, Maersk identifies seven core competencies that can deliver true competitive advantage in retail logistics.
- Process integration
Maersk recommends removing the functional separation of planning and execution via management and organisational changes that reward co-operation and achievement of strategic objectives over short-term goals.
Retailers should acknowledge that every aspect of their operations is subject to disruption and redesign systems and processes to increase their flexibility and ability to adapt.
2. Demand sensing
Maersk encourages retailers to increase the collection and effective use of data to help anticipate potential disruptions or changes. By actively flexing multiple elements of supply chains upon detection of emerging trends or specific variations, businesses can reduce the impact on any single component.
Retailers should implement key metrics to measure the time between sensing demand for a new product and launching it into the market, as well as the overall number of products introduced based on proactive sensing of new customer preferences.
3. Inventory management
Using fulfilment centres can facilitate a quicker response to end consumers’ needs, according to Maersk, while maintaining lighter and smaller inventory stocks can help adapt quickly to new demands caused by change or uncertainty.
To find out the remaining core competencies and obtain more actionable insights to improve your supply chain, download the ‘Refocus your supply chain to take the lead’ report now: www.maersk.com/retail-home-improvements-asia-pacific