Second Annual Research Indicates Increasing Availability Without Increasing Stock Holding Is North American Retailers' Top Issue Regarding Supply Chain Planning and Execution
ATLANTA, GA--(Marketwired - Apr 20, 2016) - Today, the second annual supply chain research study: 'State of the Retail Supply Chain 2016' is published, highlighting the key priorities for North American retail supply chain executives. The study has been conducted by research firm Martec International and commissioned by RELEX, the first supply chain solution provider to offer retailers, wholesalers and manufacturers the power of in-memory computing.
The new research asked retailers from North America, UK, Germany and the Nordics, with annual sales exceeding 110 million dollars*, about the top issues affecting supply chain planning and execution; the challenges they face with forecasting, the visibility they have of their supply chain, whether they operate a single stock pool across all sales channels and how productive their staff are.
Some of the key findings for North American retailers include:
- The top business issue cited by North American retailers is increasing availability without increasing stockholding (67%)
- North American retailers are most concerned about forecasting for new products (73%)
- Retailers in North America are more efficient than retailers in other countries in terms of staff productivity
Mikko Kärkkäinen, Group CEO, RELEX Solution, comments: "For me, it is interesting to discover that whilst 64% of retailers globally highlighted forecasting for promotions as one of their main challenges, only 35% have a system in place that can build automatic demand forecast for promotions and only 22% have a system that can manage promotion stock run to clear fixtures for the next promotion."
Issues regarding supply chain planning and execution
The top issues regarding supply chain planning and execution for North American retailers are similar to the global average. However, the second largest issue is better collaboration with suppliers and these retailers have a higher priority than the average retailers in the other countries examined for the report. When questioned, some retailers mentioned that they had worked on supply chain issues internally and feel that external supply chain improvements will be the most beneficial.
Challenges regarding forecasting
The report discovered 73% of North American retailers are most concerned about the forecasting of new products, which is well above the global average (58%). The United States tends to be the country where most of the new products are developed and launched, which causes greater problems for North American retailers than elsewhere where there is typically a lower proportion of new products in an assortment.
Visibility of the supply chain
North American retailers rated the visibility of their supply chains a 6.5 out of 10, which was just behind the highest rating of 6.6 for German retailers. The UK represented the poorest visibility rate of retailers (5.4), while Nordic retailers rated slightly higher (6.0). Retailers of those countries recognized that they have a way to go before their supply chains are fully visible.
Operating a single stock pool across sales channels
North American retailers with more than one sales channel are marginally less likely than average to operate a single stock pool (39% of retailers vs the all country average of 43%). German retailers with more than one sales channel are however marginally more likely to operate a single stock pool than the average at 46% and Nordics based retailers are even more at 48% against the international average.
Retailers in North America are more efficient than retailers in other countries surveyed for the report in terms of staff productivity. The average full time equivalent employee forecasts and replenishes an average of just under 270 million dollars of sales. This compares very favorably with the overall country average of just below 190 million
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