This page contains a Flash digital edition of a book.
RetailT F FORECASTING


provider Quantum Retail, commented: “The ideal is to be able to have a variety of scenarios to look at how the inventory is positioned and how the demand can best be capitalised upon. Any platform therefore, needs to be constantly updating itself so that the demand at a very micro level can be seen, and adjustments made in placement and hence profitability maximised.” But better and more


accurate forecasting works only if real-time visibility of stock is


available at all points in the distribution process. The goal should be that any item of stock being manufactured or in transit is visible to the supply chain. Retailers need the option to be able to fulfil that stock as efficiently as possible and to respond to demand to move it where it is needed to meet demand. This becomes inherently more


complex now that retailers must cater to a number


of distribution and sales channels and demands a much more proactive and flexible modelling capability. Indeed, a report by Retail Systems Research in


2013, entitled Omnichannel – the long road to adoption, showed that 80% of retailers think that a 360-degree view of inventory is very important. The report said that although the number of variable is immense, that inventory visibility gives better decision-making powers to a retailer. It can see what is in stock and where, what has been reserved and where, returns etc. It gives accuracy around current availability and when combined with underlying data can contribute towards forecasting. Craig Sears-Black, managing director at supply chain software vendor Manhattan Associates,


www.retailtechnology.co.uk


commented: “As soon as the retailer has decent forecasting, flexibility and visibility then he can make decision on where to send a piece of stock most profitably and indeed whether meeting the demand in the first place is worthwhile. Capability is not everything now, profitability is as important,” he said. For supply chain systems, this means pushing data through a rules-based data analytics process to determine if and where to push a given product, with the idea being that the actual data can be used to drive a product into the position where it has the highest chance of earning the biggest profit based on utility cost options. Day from Quantum Retail added: “Product


strategy needs to be informed by availability and profitability. For example when a retailer brings in a new product its role, i.e. loss leader, traffic driver etc. informs its price and then key strategic inventory decisions need to be made around category management so that the product is delivered over all the variety of channels in the most profitable way.” Delivery over multiple channels and availability


versus cost and profit is most amply demonstrated by the emerging ‘click & collect’ service offerings of many omnichannel retailers and how best to manage it. This comes from a customer viewpoint as well as operations one. In fact, the RSR research found that 70% of consumers also expected to be able to view in store inventory online. However, just 32% of retailers currently offer this capability, according to a report in 2014 by analyst firm Forrester, entitled Customer desires vs. retailer capability. In the UK however, Toys “R” Us, Smyths Toys and


Argos have all made strides by adapting their supply chains to enable this service. The crux of the issue operationally seems to be whether to maintain distinct distribution centres for online stock and deliver it into store or whether to use the store’s own stock instead and reduce transportation costs. Again, having visibility over stock levels and being able to accurately forecast demand or react to a spike can make all the difference. Sears-Black from Manhattan commented:


“Historically there would be an ecommerce distribution centre and a physical shop and the two


Autumn 2014 41


echnology


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60