Seasonal demand (across Black Friday, Cyber Monday, Christmas and New Year) is a uniquely challenging period for retailers as the impacts of the pandemic on shopping habits combine with supply shortages across numerous product lines and the supply chain disruptions brought about by labour availability challenges being seen across the UK.
However, Kelly Askew, Retail Strategy Lead for Accenture UK&I, describes notable improvements in delivery speed compared to previous years: “our latest research shows that more UK retailers are offering faster, more reliable, and more convenient shipping and collection options for shoppers” with only 5.5% of retailers delivering late this year, compared to 20% in 2020 (read from more Kelly and Accenture’s 2021 UK Retail Shipping Study here).
What’s changed in the warehouses and supply chains to enable this?
As a given, retailers need capacity, resilience, cost efficiency and service excellence planned and built into their fulfilment operations. Retailers that have well laid out distribution centres equipped with modern warehouse management systems and automation or robotics solutions that deliver capacity, cost effectiveness, fast fulfilment cycle times and reduced reliance on labour are well positioned.
Those that are also able to forecast, schedule, and manage their workforce effectively are best placed to attract, retain and best leverage these increasingly valuable resources, and in doing so deliver the best possible service at the lowest cost. If retailers and logistics service providers are not already equipped with warehouse labour and workforce management solutions to enable this then this should be a priority investment to ensure success going forward.
But, above and beyond meticulous planning and preparation, the ability to win or lose in peak trading periods may lie in the ability for retailers to react to changing circumstances and therefore the flexibility of their supply chain planning and execution capabilities. A flexible supply chain that is able to make a retailer’s precious stock available to the right channel or physical location (e.g in store) where it is selling best sounds obvious and simple, but the reality is very different. Black Friday for example is a short time window and multi-channel retailers that sell through both physical stores and online channels need to predict where stock will sell best and “stock-up” in advance to ensure availability.
Those that win have the ability to effectively forecast or even “sense” demand and rapidly replenish the channels through which lines are selling the best. Even better they are able to re-balance stock and have the flexibility to fulfil demand across different channels, including fulfilling customer orders from a combination of centralised distribution centres, localised dark stores/hubs, and stores. This requires a highly intelligent and data driven supply chain empowered by modern best of breed supply chain planning, visibility and execution digital technologies. Operating a retail supply chain on spreadsheets with today’s constraints on stock, workforce and immense cost challenges, is no longer viable for long term success.
Ultimately, retailers need intelligent digitally enabled supply chain planning and merchandising capabilities with resilient, scalable, flexible, cost-effective fulfilment operations to deliver the best service for their customers whilst achieving maximum profit and return from seasonal sales.
Read more from Accenture’s 2021 UK Retail Shipping Survey here – including how deliveries are now faster and more reliable, but certain costs to customers have increased.