Omni-Channel Retail and the Supply Chain
The days of going to the local department store to buy a television,
view the options available, and make a purchase now seem "quaint." The
emergence of the internet, smartphones, social media, and other
technologies has opened a world of new options for consumers (and
businesses) to review, research, and buy online with an ever-increasing
array of delivery options.
The emergence of e-commerce has resulted in what is commonly known today
as "omni-channel" marketing, in which customers engage with companies in
a variety of ways, including in a physical store or online via websites
and mobile apps. This process puts the supply chain "front and center,"
as consumers are increasingly demanding and browsing, buying, and
returning goods through various channels, not just the traditional
"brick and mortar" way. To accomplish this with high levels of service
while remaining profitable requires real-time visibility of inventory
across the supply chain and a single view of consumers as they
continuously move from one channel to another.
While this is a boon to consumers, it has made the already complex
global supply chain even more challenging to manage. On top of that, the
2020 Covid19 pandemic has accelerated this omni-channel retail trend, as
consumers need even more ways to order and additional options for
last-mile delivery, such as curbside pickup. Covid19 has exposed a lack
of flexibility and readiness, resulting in shortages of everything from
toilet paper and meats to personal protective equipment (PPE) and
ventilators. It has been a real-life example of the "bullwhip effect,"
where variability at the consumer end of the supply chain results in
increased variability as one goes upstream towards distributors,
manufacturers, and suppliers. This results in shortages, misallocations,
and increased costs.
No longer can a manufacturer, distributor, or retailer of consumer
products just "fill the pipeline" and wait for orders to come in. Now,
they must anticipate various purchases and delivery items, while at the
same time minimizing costs. To do this is no easy task, requiring a
Lean, agile, and responsive supply chain.
Until now, there was no existing "playbook" for organizations to
navigate their way through this new world. This book describes the
impact of omni-channel marketing on the supply chain and logistics
functions, and is intended to help management meet the needs of not only
today's ever-changing world but to anticipate what may be required in
the future to achieve superior customer service, profitability, and a
competitive advantage.
