☛ Want the latest procurement and supply chain news delivered straight to your inbox? Sign up for the Supply Management Daily
9 November 2011 | Adam Leach
Food and clothing retailer Marks & Spencer (M&S) has increased
investment in its supply chain to improve efficiency and tighten stock control.
The company’s half-year results, published yesterday, revealed that it
increased spending on the supply chain and technology by £4.1 million to £69
million to improve the management of inventory and distribution.
The report showed that the company has reduced shipping within its
international products category by increasing the use of its regional hubs in
Sri Lanka, China, Istanbul and Singapore. Meanwhile, a new stock management
system provides accurate, up-to-date stock-level information that enables it to
manage supplies more efficiently.
M&S chief executive Marc Bolland said: “In an increasingly
promotional environment, we managed costs tightly and took a decision to invest
in giving our customers better value, choosing not to pass on the full extent
of the increases in commodity prices.”
The push to improve data quality will be further strengthened in April
2012, when M&S completes the roll out of a SAP cost management system. The
move by the company to tighten stock control fits with the findings of a survey
just released by the Institute of Grocery Distribution (IGD). This reported
that six out of 10 retailers expect lead times to reduce by up to one day over
the next five years.
Tarun Patel, head of supply chain at IGD, said: “Manufacturers and
retailers are more focused on responding to customer and shopper needs. They
are investing in operating processes and systems that enable supply chains to be
more responsive and flexible.”
Overall, M&S reported profit of £315 million for the first six
months of the year, down from £349 million in 2010.