It is becoming decidedly clear that this year innovation is to be one of the key drivers for changes in consumer demand. Most notably, app-based technology and e-commerce is leading the way in making the retail experience more and more convenient. Not only is it now possible to create virtual shopping lists, but you can now ‘click and collect’ your shop as well as getting it delivered straight to your door. Promises of next day delivery and more frequent time slots for fresh food delivery is slowly becoming the norm and consumers are expecting and demanding more, whether they realise it or not.
With this being the case, it is paramount that supply chains are able to cater for a continually changing retail landscape. Intuition and reactivity are key attributes for meeting demand, but difficulty lies in wait as consumers don’t always consider the aftermath; increased out of date and obsolete stock, leaked profitability and reduced performance.
On the other hand, innovation in app technology and e-commerce can lead the way for a whole host of opportunities we can take full advantage of. By having customer shopping lists before they even arrive in store or receive the delivery we can use this information to be even more certain of our forecast. Even better, we can also predict promotions in store based on online take up versus the average allowing orders to be adjusted accordingly.
Indeed, the modern forecasting process needs to not only reflect the needs of the business and the users but it must also be sufficiently flexible and sophisticated to handle retail innovation. The response of the leading suppliers to this challenge is to combine retailer-facing collaborative initiatives (CPFR) with improvements to their internal demand and supply planning processes. They recognise that in today’s retail environment, leadership is achieved by embracing retail data and by improving the quality and responsiveness of their demand and supply planning processes.