Retail Supply Chain: Top Challenges

Post pandemic, the retailers in the "new normal" are closely monitoring what they order and stock as lockdowns have come and gone. Further, they need to update the channels and delivery methodologies to try and make up for at least some revenues lost to store closures and/or reduced in-store traffic.

As these new channels are implemented, the supply chains are becoming more complex. Further, retailers need to ensure that they’ve established a foundation of technology to manage this complexity — and even simplify it. It is no longer enough to focus on the links between supplier and warehouse or distribution center and store. There are more delivery options to manage, demand points to forecast, inventory fluctuations to attend to and spending peaks and valleys on the horizon.

However, what most people do ignore is the implications of these complexities and expectations on the retail supply chain. After all, how else will retailers fulfill orders without their supply chain, yes? To help you understand this better, we have listed below some of the key challenges that plague the retail supply chain. 1. Fulfillment-related issues: One of the biggest changes retailers have noticed in the past decade is that customers’ expectations have changed significantly, especially in the context of how they receive their products. Some want their orders delivered to their doorstep, some want them delivered into their vehicle’s boot, and some want to be able to pick up their order themselves. Such varying expectations result in logistical and fulfillment-related challenges for retailers who must now build up capabilities for distinctive shipment and delivery methods. 2. Expansion to new locations: Literally every company hopes to grow and expand the business. This, however, has distinctive implications for the retail sector and its supply chain. You see, when a retailer expands to new locations, be it domestically or in international markets, it must brace for countless changes and such to ensure the success of its endeavors. Plus, retailers must also scale up their logistics and supply chain operations to successfully tend to the new demand. 3. Customers’ demands: Today’s customers, especially those of the retail sector, have been spoilt for choice and have very high expectations from the brands they engage with. What that means is it can be quite tricky to satisfactorily fulfill the modern customers’ expectations, especially in this omnichannel environment. To fulfill the expectations of this omnichannel market, retailers need a highly agile supply chain because customers do not only want to be able to place their orders via their preferred means, but also want flexibility when it comes to the delivery/fulfillment of their orders. Then there is the agility for returns, low costs, etc. as well. 4. Logistics: Ace management of logistics is critical to the success of any retail venture. Unfortunately, this is easier said than done, for there is a multitude of factors that affect logistics and freight movement. First, the inbound shipments, which typically include those from international markets as well, must arrive on time. Then, there are outbound shipments, wherein the retailer must ship goods to different stores across different locations and such. This involves handling bulk shipments as well as smaller shipments to individual customers as well, i.e a complicated undertaking.There is no denying the fact that the retail supply chain is decidedly among the most complicated endeavors out there. The supply chain remains critically important nonetheless. Of course, complexities are a part and parcel of any trade and the first step in the endeavor to deal with such challenges is awareness. Being aware of the issues that one is likely to encounter, such as the ones listed above, helps businesses understand the problem in-depth and prepare with possible solutions to said challenges. Unfortunately, these are only some of the challenges retailers have to contend with and that necessitates the use of some top-notch, technology-driven solutions. We recommend that you get in touch with a trusted logistics software development company to get started.

Olivia Johnson is a technical writer, love to share stuffs related to technology & development.