Supplier Collaboration - Giving Retailers The Cutting Edge In Today's Global Economy
June 2012 Integrated Solutions For Retailers
By Bill Ren, CEO, Arigo
Millions of dollars are wasted daily through slow, antiquated supply chains that haven’t adapted to today’s realities.
In today’s global economy, getting data quickly and cost-effectively is the name of the game. Most trading partners, suppliers, and service providers are willing to provide sought-after data when needed, but are they using the right avenues to deliver? And then, once we get the data, what do we do with it? It’s an interesting paradigm when a retailer is trying to improve supplier collaboration, yet still using disparate systems to collect it.
Today, out of necessity, competitive businesses source products from North America, Asia, Europe, and the rest of the world, but often the sourcing process still includes Excel spreadsheets, calls, faxes, and emails — leaving a paper trail that is unsynchronized, unauditable, and disorganized at best. When sourcing decisions are spread across dozens of documents, emails, and geographies, mistakes are bound to happen, and costly ones at that. Ordering too much, too little, from the wrong source, at the wrong time, and through the wrong port are mistakes that occur far too often. The costs for such mistakes — noncompetitive product mix, potential for brand erosion, overstocks, customs fines, surplus markdowns — are high, the possibilities endless, and the overall outcome costly.
Years ago, retailers needed only to communicate with their buying offices and suppliers to retain visibility as to when their goods would ship and arrive. Today, with an increase in stringent regulations and stiffer competition driving tighter control over profit margin, retailers are forced to improve their supplier collaboration in order to maintain efficiency. By getting closer to the factory floor, retailers can monitor costs and better understand where their products are, during all phases of the supply chain — providing visibility and accountability while protecting the brand.
Integration Is A Time And Money Saver
Manually intensive procedures limit the retailer’s ability to handle growth and meet strategic goals without playing catch up. A supplier collaboration system that is both complete and resourceful includes a central data repository, which provides up-to-date, inclusive, and accurate data. Such collaboration enables information flow across a multitude of channels, time zones, languages, currencies, etc. With proactive alerting supporting a single version of data, collaboration delivers immediate value to the business community, enabling retailers to contend with better-resourced competition. This can result in measurable time savings and smoother-running operations.
Likewise, the lack of an integrated infrastructure prevents users from understanding the downstream implications that occur when a change is made; brand managers, packaging teams, supporting agent teams, and other departments have no visibility to the changes that affect their day-to-day functions. As a result, they spend valuable time making phone calls, sending emails, and conducting meetings to get everyone back on the same page. This time-consuming process prevents employees from concentrating on the important tasks at hand and opens the door for national brands to be selected over private brands. Not having the higher-margin private brands on the shelf in a timely manner directly affects the retailer’s bottom line.
Ultimately, retailers need a system that synchronizes processes that span the enterprise and supplier community on a real-time basis. They need a system that can exchange data between legacy enterprise and supplier systems, while enabling businesses to make accurate decisions by creating actionable analytics supported by a foundational framework to seamlessly aggregate data from multiple sources.