e-commerce trends influencing brick and mortar stores

E-commerce Comes Back To Help Brick & Mortar

We know lately the trend of more retail giants closing their doors has been splashed across every news outlet , but now some brick and mortar stores are learning from these e-commerce trends.

Experts predicted online shopping, led mainly by Amazon, would one day eliminate brick and mortar stores and conquer all of retail. The rate of store closings set a record in 2017 with no type of store excluded. Havoc stretched from Madison Avenue boutiques to shopping malls across the country, making retailers jointly struggle. At this time in 2017 nearly 5,700 stores had closed their doors for good in the United States, according to retail analyst firm Coresight Research. This year only 4,480 stores have closed.

But Then Something Changed For Brick And Mortar Stores.

One thing breathing life into vacant malls are stores learning to capture the ease and instant gratification online shopping provides. Online shopping is a platform for customers to shop while in the comfort of their own home; something major retailers are starting to adopt and it’s working! The retail giant, Target has adopted a new practice where customers order what they need through the app, drive to their store and a team member meets them in the parking lot with their order. No getting out of the car and no waiting in line at the register. Since the launch of this program, Target saw more traffic online and in store than they expected to. Growing at its fastest pace in a decade.

Walmart has introduced “personal shoppers” to its mix of employees to select and package groceries for curbside pickup. It’s the same process as ordering online, with a little personal touch.

The retailers evolving their shopping programs recognize that Amazon has forever changed consumer behavior. Many successful stores are now a cross between a drive-through and hotel concierge; trying to keep customers satisfied and, in turn, loyal.

The main reason for the slower pace of store closings is due to unprofitable stores having already been shut down. Still, big retailers like JCPenny and Sears, despite closing failing stores and sprucing up the remaining ones, are still struggling. Therefore, the other reason is stronger players are benefiting from other stores’ failures. Target, for example, saw a huge leap in toy sales as Toys “R” Us entered their final days of their liquidation sale.

Information obtained from: nytimes.com

So What Does All This Mean For Retailers’ Supply Chains?

E-commerce has halted many B2B supply chains from growing since its boom. However, with these new shopper programs being introduced, supply chains will pick up. With the economy bouncing back and consumers having more to spend, products will be moving quicker; especially if shopping is “hassle-free.” Retailers are now taking a store-centric, omni-channel approach, connecting every dot imaginable in their consumer buying process. Big players are investing in robust digital models of the entire store footprint, giving employees digital merchandising tools, and using automation to enable visual merchandising and easily create store specific plans. A deep analysis of store models allows managers to optimize product placement and  This enables employees to track merchandise currently in store, en-route to store, or allowing them to order stock on the spot for customers. Therefore, saving customers time in the store, or from having to order merchandise after the fact.

Target even plans on opening new, smaller stores near college campuses with products specified for the area’s demographic. Instead of shoppers meandering through cavernous buildings, the retail giant will stock stores with targeted products that have a definitive vibe. This shortens shoppers time in the store and places what they want out in the open. Talk about a new meaning for “Target.”

How Does Automated Software Help Supply Chains?

An automated software solution integrated into a supply chain allows for greater visibility of orders. It connects the manufacturer/supplier, distributor and retailer throughout a package’s entire journey, keeping everyone in the loop and alerting retailers where merchandise is. Whether it be in stock or en-route.

Here are five main features an automated software needs to keep up with the e-commerce trend:

  1. Reporting Features

    Having accurate reports for purchases will make order fulfillment and store floor planning a smooth operation. Our software produces bill of lading, VICs bill of lading, carton contents and branded packing lists, making client recognition immediate. These reports are sent to retailers alerting them of every detail and quantity on their order. It makes it easier to track the progress and location of the order, and for employees to know when shipments will be in. Digitally connecting orders to stores using supply chain technology.

  2. Advanced Shipping Notice Kits

    Trading partners have specific requirements for the advanced shipping notices they receive. Having a software that already has the information installed on it will make switching back and forth between partners hassle-free. We have more than 190 different ASN kits for retailers and automakers programmed into ComplyLink. These ASN kits cut time and accurately inform clients on their orders.

  3. Integration

    Supply chains already have processes and procedures established, so it’s important for automated software to integrate into the existing system. Our software has integration features that’ll connect to EDI and ERP order management tools. ComplyLink installs on suppliers’ server or workstation and electronically talks with accounting to confirm, pack and ship orders, and then verify they’re on the truck to be shipped before marking it complete.

  4. Order Verification Processes

    ComplyLink has various scanning and packing routines that support and expedite order fulfillment. These routines eliminate the need to manual enter order data in warehouse and distributors’ databases. With these processes, there is a 20 to 40 percent decrease in translation errors because it eliminates human error possibilities. There is also a 28 percent decrease in order costs because we provide tools for automatic data entry instead of having to manually type orders in. Automated processes streamline redundant, tedious tasks with the highest risk for mistakes.

  5. Customization

    The most important feature an automated software can have is the ability to be customized. Having a software that doesn’t require dramatic shifts in manufacturing procedures can alleviate pressure and uncertainty in the transition. ComplyLink ensures an easy adaptability period without missing a beat (or an order in this case) because we work with our clients to install it according to their needs.

The Key Takeaway:

E-commerce hasn’t fully claimed the retail world – and it may never get there. Warehouse managers and retailers working in conjunction with digital trends is the link brick and mortar stores need. Playing to their strengths and optimizing shipping and order-processing cycles via an automated software. Retailers can restock stores, optimize their layout and keep suppliers busy by providing material releases week by week, or with an overall product forecast. Notes like these are housed in a software like ComplyLink and keeps records for orders updated. Retailers and suppliers integrating electronic communication tools like 830s and 862s between each other pave the trail for success.

 

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Blame It All On Our Roots

A moment of impact – never realized at the time, but these moments have a way of defining the future. In the late 1800s to early 1900s the thought of revolutionizing manufacturing and shipping processes was obscure. The industrial revolution brought cars made in one-sixth of the time it used to take initiating a moment of impact. Manufacturing processes have since continued to be optimized and supply chain innovation has come a long way since its development in the 1980s.

The First Moving Assembly Line is Introduced in 1913

So what moment of impact links the revolution of the manufacturing process ultimately to the supply chain? The founder of a major automobile manufacturing company back in 1913 may be who we tip our hat to. Henry Ford may have not invented the first automobile, but he certainly is credited for revolutionizing the manufacturing process still used today. The moving assembly line, which was influenced by Model N workers who would arrange all the parts on the ground onto skids and drag them down the line, reduced car manufacturing from more than 12 hours down to two and a half hours. Ford broke the Model T’s assembly into 84 discrete steps and trained his workers in just one area of assembly.

Never has a thought like the assembly line been formed, but Ford credits the continuous-flow production used in flour mills, breweries, canneries and industrial bakers. And in 1914, almost one year after implementing the assembly line, Ford added a mechanized belt that chugged along at a speed of six feet per minute.

The moving assembly line was deemed an innovation that changed the world. It reduced the cost, time and manpower needed to produce cars, and it dropped the model T significantly from $850 to $300. For the first time quality vehicles were available to the masses and on June 4, 1924, the ten-millionth Model T automobile was created. Ford’s approach spread to other automakers, manufacturers of phonographs, vacuum cleaners, refrigerators and other consumer goods. More innovations like just-in-time inventory and time quality management helped make today’s automotive manufacturers the model of efficiency. How? Repeatable, standardized processes that are universal to any make, or model of the automobile.

“The assembly line became the characteristic American mode of production.” – Bob Casey, former curator of transportation at The Henry Ford.

Warehouse Management Systems are Implemented Across the Country in the 1950s

The 1940s and 1950s brought the challenge of improving very labor-intensive processes of material management. The need to continue to innovate the manufacturing and distribution processes was prominent. The goal was to use racking, and better warehouse design and management. By the 1960s, the trend of time-dependent freight transportation to truck rather than railway evolved for higher efficiency. The 1960s also brought the end to an era with regards to computers. Prior to then, virtually all transactions and record keeping were done manually.

The computerization of this data broke ground to marvelous innovations in logistics planning, from randomized storage in warehouses to optimization of inventory and truck routing. The late 1970s to early 1980s created many different types of material handling research centers that focused on a different aspect of what this new technology made possible.

The 1980s sparked a boom for logistics. Personal computers provided better access to planners and a new graphical environment for planning like spreadsheets and map-based interfaces. Logistics management had begun to get tremendous recognition from the industry for being expensive, very important and very complex. Executives became aware of logistics when they heard it could improve their bottom line, but only if they were willing to invest.

Supply Chain Innovation

The concept of the supply change earned global recognition in the 1990s. The focus of globalization emphasized the need for logistic strategies to deal with complex networks. Strategies including multiple entries spanning from multiple countries with diverse control. The 90s brought life to Enterprise Resource Planning systems or ERP, a spin-off from material requirements planning systems. ERP systems integrated better with the multiple databases that existed, and was a tremendous improvement in data availability and accuracy.

Where Are We Now?

One hundred and five years after the biggest revelation that changed manufacturing, the supply chain is still improving. Systems are becoming more integrated with software. Processes are becoming more integrated with people. The growing demand from consumers has forced companies to adapt their shipping strategies, lest they shut their doors permanently. The end goal is getting goods out to customers as swiftly as possible to keep them satisfied. Henry Ford acknowledged that need in the early 1900s and his method is still being used to this day. Granted its changed quite a bit to having robots perform much of the work, but that’s the impact of innovation. Same thing goes for supply chain innovation.

The growth from manual order entry to computerization of data changed the face of supply chains. Systems for B2B shipping have become more efficient allowing for faster transaction rates for manufacturers and distributors. We have the ability to now pick certain products to pack instead of having to ship entire pallets of one single product. Having a database that automatically updates and prints accurate GS1-128/B–10 PDF417 labels detailing every item in the container allows your business to stay ahead of the competition. Our software allows you to scan to pack, scan to print and scan to verify. ComplyLink puts all the required information on one label for fast and convenient order management.

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5 Ways Digitization Transformed the Supply Chain

Digitization has proved to benefit the efficiency and productivity of the supply chain. The point of digitizing is to revamp supply chain management and to streamline repetitive tasks. A 2017 study from McKinsey found the average supply chain has a digitization level of 43 percent and only 2 percent of executives said that the supply chain is the focus of their digital strategies. Seizing an opportunity to digitize the supply chain has surprisingly been a challenge for a lot of companies. Embracing new technology also means revamping operational practices – which could even mean building a whole new management strategy.

The best way to digitize is to integrate advanced, leading-technology and revamp operations. Management usually understands the measures to the transformation approach – establishing a vision for the future supply chain, assessing the current state and envisioning the future path to take.

We’ve analyzed five different ways that digitization influenced the innovation of the supply chain.

  1. Supporting major operations like warehouse management.

    It was clear there was a need for innovating warehouse management. Tasks were becoming too tedious and were at risk for being mismanaged. Digital technology provides tansformative capabilities for inventory management. Linking cross-functional data like inventory, shipments, and schedules from internal and external sources, forecasting demand and performance. This is a way for planning to become more precise, and problems can be anticipated and prevented. A supply chain digital-transformation, then, is about establishing how applications can improve cost, agility and inventory levels to drive operational excellence. Our ComplyLink software is an automated database that tracks and traces every order that comes through an order management system – helping to manage inventory levels. Scanning routines like scan/pack, scan/print and scan/verify with ComplyLink automatically updates the database with shipping data. As a result, it eliminates the need for manual entry of order data making warehouse management more efficient and accurate.

  2. Digital transformation employs analytics, artificial intelligence, and other advanced technology to collect and process information automatically.

    Before digital technology, orders were processed by hand; getting passed along, person to person. Each time facing error-prone updates causing incorrect or delayed orders. Files were easily lost and entering data was a painstaking task. Our suspicious order monitoring software, SOMLink, is designed with a repository to store critical information pertaining to each customer. Each time an order is processed we compare it to past orders in regards to frequency, size and pattern. This allows companies to quickly identify and be alerted about orders of interest. Instead of delegating a single person to manually keep track of records for orders of interest and report then to the DEA, we created a solution to automatically process and store that information. SOMLink automatically captures orders of interest before they are fully processed and directly reports them to the Drug Enforcement Administration. Significantly reducing the risk for businesses.

  3. New technology can integrate better methods for collaboration.

    The key to supply chain success isn’t just a matter of buying and installing software. It’s about utilizing this software to reach the highest level of collaboration because it allows for an end-to-end perspective and update of the supply chain. This supports the overall mission of changing the ways employees and teams share/gather information. It also seeks out problems and opportunities for improvement, reaches decisions and carries out actions. The newest digital technologies can move a company forward with better methods of collaboration and prevent them from returning to their old ones. For that reason, both of our solutions have a multi-user interface feature that encourages collaboration among team members. It’s a key value for us to ensure our solutions make businesses more efficient and operations a lot smoother.

  4. Digitization can provide better end-to-end customer engagement.

    When supply chains utilize digital technology it allows the process to be undeniably transparent. The technology gives mangers more control with the orders and having a system that automates everything provides customers with detailed updates about their shipments. These updates include routing information, quantity of contents, and the date they’ll be shipped and delivered, also known as an advanced shipping notice. ComplyLink has a transportation management feature where suppliers and their customers can electronically exchange information from purchase orders to shipment authorizations. We make it easy to keep your customer “in the loop” so communication is not lost, and shipments are expected. The TMS feature also sends detailed advanced shipping notices to customers allowing them to prepare ahead of time for orders.

  5. Digital technologies provide deeper, more insightful assessments on supply chain performance.

    Integrating supply chain processes with ERP systems sets up data streams from sources within its organization. Incoming data is fed into the same processing engine where it can be connected to show how activities and decisions in one area of the supply chain affect other operations.  Linking related data sets can uncover systemic issues including: mismatched lead times and past-due purchased orders that hinder future key performance indicators of future demand for extended suppliers.  The consequences of not linking related data sets leads to customer order delays. This ties closely with that end-to-end perspective necessary for supply chain success.  Supply chains quickly have a domino effect if technology is not employed. One area of the supply chain isn’t fully up to speed and another area is waiting on them, it prevents high levels of work getting done. This feature ensures efficiency and create high-end productivity among the team.

 

 

Source: https://www.mckinsey.com/business-functions/operations/our-insights/digital-transformation-raising-supply-chain-performance-to-new-levels
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Workforce Domination: Millennials and Supply Chain Management

Millennials are quickly taking over the workforce. The Governance Studies at Brookings predicts that by 2025, 75 percent of the workforce will be millennials. So, what will become of the supply chain in the millennial workforce?

A study done at the close of 2017 by the Council of Supply Chain Management Professional found striking results in regards to the future. CSCMP interviewed 300 young professionals. Of those 300, 70 percent are working towards a bachelor’s degree and 54 percent are majoring in supply chain management or a related field. The reason? When choosing a career choice, millennials gravitate to jobs that give endless opportunities and different types of jobs. They’re also looking for an abundance of room for growth. Millennials appreciate the surplus of opportunities for internships and first hand learning, saying it gives them perspective into the job before graduation.

Job satisfaction is another reason young professionals are looking to supply chain management for their career choice. When asked, 88 percent responded positively in regards to their overall job. Most using words such as “good”, “meaningful” and “enjoyable”.

Despite these reported high levels of job satisfaction, millennials are always looking for the next great job opportunity. A way for them to design, develop and implement business strategies of their own.

Millennials and the Attraction to Supply Chain Management

In the past 20 years we’ve been around, we’ve seen consumerism turn into an around-the-clock, on-demand industry, an increase in prescription drug abuse, and more and more shipping regulations put in place by big retailers and automakers. And throughout it all, we had to tailor our software to meet those demands.

These are the things millennials crave to be a part of. They want to effect change. After all they’re a huge reason new consumerism trends are emerging from brick-and-mortar stores to online, 2-day delivery.

Supply chain management provides millennials with the task of problem solving and analyzing business’s needs. Solving supply chain problems requires sorting through piles of data and delve into descriptive, predictive and prescriptive analytics.

A career in supply chain management also provides opportunities for millennials to make an impact. Lots of businesses are struggling to keep up with growing consumerism trends. We work to decrease those chances by completely customizing our software for our clients. Tailoring our software for clients makes projects impactful – even the slightest change brought on a company’s supply chain has a large impact on how it runs overall. Every decision made changes the face of the company strategy and organizational structure.

The wide varieties the supply chain industry offers keeps millennials engaged and stand out as a key reason they study supply chain management.

Sources:

https://www.forbes.com/sites/workday/2016/05/05/workforce-2020-what-you-need-to-know-now/#45d7ff062d63

http://www.supplychainquarterly.com/files/pdfs/YP_insert_final.pdf

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Consumerism – Then and Now

You’re a consumer, I’m a consumer – we’re all consumers, and in today’s modern world, appearance goes a long way and captured the attention of millions. The evolution of consumerism has rocketed forward in the last 10 years bringing the supply chain world with it.

Picture this: 10 years ago you walked into a brick and mortar store, found those amazing jeans the model had on in the catalog only to discover they don’t have the right size. Back then you more than likely would have accepted the item was unavailable and perhaps you waited for it to be restocked. The key word here being “waited”. A store associate even told you when to check back into the store for those jeans. Or maybe you chose to order them from the catalog and called to place the order. Those jeans would arrive in 1 to 2 weeks. Great!

Today, the demand in the fashion and apparel industry is a 24/7/365 operation. Consumers expect to be able to order those same jeans in the store, online. They then want immediate gratification of them arriving in the mail the next day. Here’s another scenario:  the consumer asks the salesperson to order the item and they realize it’s completely out of stock online and don’t know when it will be restocked. Good luck to the employee delivering that news. That’s just unacceptable in today’s world.

The demand in retail has grown exponentially over the years. We have things like Etsy, online garage sale sites and overnight shipping where you pay almost the same amount as the product itself. But people go nuts over it! Stores have to compete with retail giants that only exist in a virtual world because consumers would rather sit on the couch to shop versus getting in the car and driving five miles down the road. It’s way more convenient for them to order clothes online and if they don’t fit, you just put them back in the box, schedule a pick-up and it’s good riddance. 

What else do store have to compete with? Protecting their brand. One reason B2B shipping fails is due to brand loyalty. Consumers expect brands to have products shipped to the right place at the right time. Retailers are on the front line on this consumer explosion not the suppliers. But if the supplier’s supply chain fails, or can’t keep up due to outdated software, they lose a client. On the flip-side, if a product is not stocked in the stores, people will shop elsewhere. If it doesn’t meet quality expectations, people will return the item and complain on social media, deterring other consumers from shopping there.

Malls are feeling even more pressure with the boom in e-commerce. Many of their anchor stores have closed or are closing in the near future due to a lack in foot traffic. Consumer habits are undergoing a rapid change. More notably the decrease in interest in spending a Saturday afternoon at the mall with friends. in 1970, Randall Park Mall east of Cleveland was the largest mall in the U.S. In 2015, they closed and the land was revived in 2017 as an Amazon fulfillment center. Ironic. 

So what can we as supply chain professionals do to compete with this trend? Is B2B shipping a thing in the past? Will it be extinct in the near future?

For the past 20 years the demand for supply chain collaboration between retailers and suppliers. Poor order fulfillment and late shipments are often the result of poor visibility to demand and order regulations put in place by the retailer.

In arecent benchmark study on the state of retail-vendor supply chain relationships, both retailers and vendors were asked to rate the barriers to better collaboration.

What was discovered? The top rated barrier for both retailers and vendors/manufacturers is a lack of quality/availability of data to act upon to collaborate (scale of 1 to 7, with 7 being the highest barrier – score is the average among respondents). This lack of actionable information is of course the essence of the initiatives around ECR, CPFR, RFID, etc.