Mobility advantage- supply chain’s potential in retail boom

Mobility advantage to maximize your supply chain’s potential in retail boom

By Purushottam Darshankar

India has witnesses a big boom in retail industry and KPMG’s associate director Kaushika Madhavan says, "All new entrants are planning rapid expansion and such a scale of ramp-up requires scalable processes and systems, which retailers are yet to develop. So we would witness mistakes being made as Indian retail evolves. Ability to learn from mistakes will be a critical success factor.” and he further adds “The fact is that most retailers in India still don't have a stronghold on operations -- be it merchandising, supply chain management or procurement." In today’s competitive world, the customer’s expectations are more demanding in terms of the level of service they require and the speed at which they expect it to be provided.
One way of making supply chain performance efficient is to make manufacturer responsible for distributor’s inventory levels. Distributors will benefit with this, by reducing requisition-to-order costs, improving fill rates, decreasing stock outs and decreased inventory costs. Manufactures will benefit from reduction in ordering errors, better forecasting, and more efficient promotion planning.
The inventory solution can be possible by virtually connecting the two businesses together through internet. This can be done either by distributor reporting the sales data to the manufacturer or by providing access to point-of-sale data for purpose of determining inventory levels.
Use of bar code scanning technology can be very useful in implementing the inventory solution. There are many devices in market today that combines Windows Mobile platform with bar code scanner to manage the physical inventory. The user experience is much easier as the user has to simply run into a store room and take what they need. The scanned data can be uploaded to backend server in batch at the end of day or in real time using data capabilities (GPRS, EDGE or PDSN) available in hardware.
The key to a successful inventory solution implementation is to understand a workflow that is going to work best both for consumer and distributor.
Alternatively, the mobility solution can be of much importance to transportations and logistics needs of most modern businesses. One of primary services expected by the transportation and logistics customers is timely status updates within the supply chain. Unlike the supply chain of past, heavy inventory is discouraged as cost is involved in moving the products and storing inventory in warehouse or on store shelves. The only time the product makes money is when the end user purchases it.
Due to lean business methodology of today, many enterprises prefer a flowing supply chain that moves product to store or retail outlets via Just-In-Time (JIT) shipping. Faster the product can be delivered to customer, the less it will impact the bottomline. The biggest issue the enterprise face with JIT shipping is the chance that there will be a breakdown in supply chain due to delays in transportation, inclement weather etc. This can be very costly in terms of revenues, but also in terms of customer loyalty.
Many Indian enterprises have started using the SMS (short message service) based solutions along with GPS (Global positioning system)/LBS (Location Based service) technology as means to provide the status data. The future of the industry is web based “push” technology systems that makes use of GIS (Geographical information system) and GPS technology to update the end user with the status as they happen.
The supply chain of future will depend upon the technology that is as mobile as the inventory that is being monitored and tracked.