Leveraging Technology in the Retail Supply Chain
Technology has disrupted pretty much every aspect of industry. From IoT sensors to omnichannel communications platforms, doing what we do is becoming more efficient, more predictable, and more cost-effective from end-to-end. In the retail supply chain, technology has maximized value at every level. Technology delivers crucial data, provides crucial business insights, and tracks items from the factory floor right to the consumer’s door. It helps decision-makers act quickly when needed and reduces waste, creating an environment that is as efficient and cost-effective as it is friendly.
Most important of all, however, is the fact that the supply chain is no longer simply a means to an end. Whereas in the past, it represented the channels by which companies accomplished their most basic tasks—receiving goods, sourcing raw materials and components, shipping out the finished product—it is now a driver of growth, the basis for new business models and a foundation for amazing customer experiences.
So, let’s look at some of the ways the supply chain has been transformed by technology and what technology, specifically, is at the heart of these transformations.
Artificial Intelligence (AI)
Leveraging AI in the retail supply chain reduces forecasting errors by up to 50 percent and prevents inventory reductions at a rate of 20 – 50 percent. Some of the ways that AI is helpful in the supply chain include inventory management, packaging, and logistics optimization. AI collects data from consumers and transmits it back up the supply chain, allowing manufacturers to respond to consumer need in a timely manner. AI also supports the sourcing process as well, reducing time-to-market so that companies can deliver solutions more quickly.
The Internet of Things (IoT)
IoT and industrial IoT (IIoT) is deployed throughout the distribution network as well as on the factory floor. Sensors monitor machine function and provide real-time insights as to how machines are performing, averting costly slowdowns and downtime and freeing up floor managers to focus on more valuable tasks. Beyond the factory, IoT is also deployed throughout the supply chain, from logistics straight through to warehousing and beyond. With the ability to accurately track assets in this way, stakeholders have complete visibility into their entire operation, allowing them to make decisions quickly when it matters most.
RFID sensors allow companies to monitor components and products at a macro level. A recent study found that RFID technology can help companies achieve 100 percent order accuracy, which would, therefore, eliminate claims costs throughout the supply chain. At the store level, items tagged with RFID sensors can reduce out-of-stocks by up to 80 percent.
Blockchain is all about accountability and data security. Being able to accurately pinpoint exactly what events have occurred, where, and how, allows companies to proceed with greater efficiency in the effort to drive down costs. Blockchain effectively eliminates the need for data intermediaries, providing visibility and understanding to the product lifecycle from end-to-end. Blockchain will support luxury brands with the added benefit of being able to eliminate counterfeiting, lending more consumer confidence while boosting profitability.
These are just a few of the many ways technology is transforming the supply chain. Leveraging solutions such as AI, RFID, IoT, Blockchain, and advanced data analytics is the way the world’s most successful companies are rising to the top. To learn more about how technology can transform your supply chain, reach out today.