Procurement and supply chain in the retail sector

How is procurements role structured in the retail sector?

Retail procurement will mainly focus on finished goods ranging from Fast Moving Consumer Goods (FMCG) to single purchase luxury goods. It can involve procuring from established brands or own branding goods to compete alongside the established brands.

The procurement strategy increasingly has to consider how this will work with an Omnichannel shopping experience as customer expectations on availability increase.

Planned obsolescence is a useful tool for organisations to stimulate consumer demand at a time that benefits the organisation and can be viewed as a necessary enabler of innovation and economic growth. It can however also be viewed as incompatible with good corporate social responsibility.

How is FMCG procurement different to public sector procurement?

If you are working within a supply chain or procurement role within an FMCG role, you may find the following differences compared for example to the public sector:

  • You are closer to the end-user
  • You tend to operate further down the supply chain
  • Inventory management is a high priority

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Which areas of FMCG procurement and supply chain are similar to other sectors?

Whilst some areas of working in the procurement supply chain in the FMCG sector vary, there are a few areas of similarity:

  • Supplier relationship management (SRM) is important to strengthen your market position
  • Internal stakeholder engagement remains key to understanding and meeting the organisation's needs
  • Company strategy and aligning your procurement and supply chain strategy to this remains significant
  • Operations whilst possibly more closely aligned in an FMCG environment, there is still considered to end of life and logistics requirements for products

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