Managing suppliers is the key to adapting to changing customer demands

Sarah Windham-Luck
posted by Sarah Windham-Luck
24 July 2014

25 July 2014 | Sarah Windham-Luck

Sarah Windham-LuckTo adapt to changing customer demands and tastes, retailers are looking at all parts of their operations to find the best way to ensure this happens consistently. One key area that can add significant value is managing suppliers as efficiently as possible to better guarantee availability of stock.

The role of supply chain partners should be to proactively encourage and implement the flow of information (and products) throughout their own supply network. But making this work is about more than just paying lip service – to properly support the sector, suppliers must ensure that regular operational meetings are held with their retail partners to anticipate issues early and to address them quickly and efficiently. To ensure proposed solutions are relevant and fully embedded suppliers also need to have a strong stakeholder network within the retailer and be fully integrated in their culture and processes.

Equally as important is the need for retailers to regularly audit their supply chain relationships to check they are getting as much value out of them as possible. The role of the supplier is to anticipate demand so it is essential they have a clear and concise understanding of a retailer’s customer groups and their specific needs. As well as demonstrating this understanding, suppliers must be able to show that they have the right approach to managing breakdowns in the supply chain. This should cover access to alternative vendors.

Whatever the crisis, retailers must be able to continue to meet demand and suppliers must have the due diligence plans required to support this – a ‘hands-on’ approach with weekly, if not daily contact to assess progress is a vital way of ensuring that this approach doesn’t slip.

Often, dealing with a varied store estate and a disparate supply network means that for many retailers, it can be difficult to retain control over the flow (and availability) of stock. Consolidating the number of suppliers used is therefore key to maintaining the right level of control. In addition, this means retailers don’t have to manage more varied levels of delivery and quality which can be both time consuming and counterproductive.

Moving away from the more strategic elements of the retailer-supplier relationship, something as simple as the way in which a supplier organises their warehouse facilities has a direct bearing on their ability to deliver. Using available space in the right way by organising faster-moving goods into easy access areas, for example, is vital in maintaining a high level of efficiency. Implementing the latest technology within the packaging and delivery process is of equal importance here.

Here is an ‘at a glance’ summary of the tips discussed in this article:

• Suppliers – get your warehouse and delivery infrastructure in order to ensure you deliver at the right rate

• Rationalise the supplier base – essential for retailers and suppliers alike

• Suppliers must be ready to adapt to fit spontaneous demand from their retail clients

• Suppliers should constantly assess how they can add value

• Share successes and continuous improvements to gain accreditation

The lines between channels are becoming increasingly blurred as mobile-commerce, in-store consumer-specific marketing, online purchases and click and collect all merge into one total retail experience. Suppliers must therefore actively help retailers in meeting the “right now, any time” culture head-on to better guarantee availability.

☛ Sarah Windham-Luck is director of retail at Office Depot.

 

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