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RATES NEWS Supply Chain Gaps
INVENTORY BALANCE is an evolving science, and at times a game of luck. For retailers, deci- sions on inventory purchases, often made months before items actually hit the shelves, neces- sitate considering consumer confi dence levels and projected spending. Unfortunately, today’s demand forecasting activity continues to be built around a store-centric demand model, without the acknowledgement of multichannel retail. The, “State of Cross-Channel Retail Supply Chain Execution,” benchmark report, conducted by Aberdeen Group Retail and Banking, re- vealed that in response to global demand volatility and increasing consumer desire for cross-channel shopping, retailers are looking to increase forecast accuracy, supply chain responsiveness, and fl exibil- ity within their supply chain. Out of the 65 multichannel and
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store retailers surveyed, 50 percent indicated that they have no access to real time inventory and order data. As a result, they order too much and the extra inventory is carried on the books as an asset, added to the net profi t, and there- fore taxable. Or, like the recent mishap experienced by electronics retailer, Best Buy, they are unable to fi ll orders because some prod- ucts run out of stock, requiring steep discounts later. To better handle supply chains,
retailers need to improve the re- sponsiveness of the links in their supply chains and increase their ability to see how chains operate, in order to avoid both out-of-stock and overstocked items. Retailers looking to deliver on their prom-
ise to meet demand must also understand the technology con- sumers are using to learn about and purchase products outside of the store. According to the study, 69 percent of retailers say they don’t have programs in place that would enable them to see their sup- pliers’ inventory levels. Retailers are faced with the reality that they need to fi nd a better way to fore- cast demand for inventory, while 55 percent of multichannel retail- ers and 41percent of store retailers say they are also trying to get a more accurate read on store and product-level inventories. This ar- ticle has been adapted from a piece on
InternetRetailer.com. ■
NEWS
Dollar Stores On Roll continued from page 8
leading players in this retailing sector are dollar store chains, such as Dollar General, Dollar Tree, Family Dollar and 99 Cents Only, which are driving store traffi c and upping transaction size by adding more high-turn consumables and improving in-store presentation. But it is the fact that dollar stores now serve a larger consumer base that allows many independent discount/dollar stores to thrive and pop up across the nation. In fact, a study by Retail Forward estimated that enough untapped and under-penetrated geographic markets exist in the U.S. to sup- port another 15,000 dollar store retail outlets. ■
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