Here is your math lesson for the day: an integrated supply chain + updated inventory = happy customers
As a marketer, I’m not supposed to like math. But my deep, dark secret is that I was actually a finance major and I love math. I even took engineering-level math classes during business school even though I didn’t have to – I know, that’s sick! But the “happy customer equation” is actually quite simple for any company to understand. Collaboration between vendors and sellers is a critical component to driving a better customer experience.
I recently went to a conference that was focused on retail technology. There, they presented lots of big ideas around merchant needs and how to use technology to get there. Many of the ideas were very lofty, but one analyst ended his presentation with a simple dose of reality. He said that while all of the topics presented were cutting edge and interesting, the basic principle still remains: stock availability is still the most important factor in satisfying customers.
I read a bunch of articles this week that support the need for updated inventory and supply chain integration, each from a slightly different angle.
Inside the Retail Collaboration Quadrant – Eric Green provides a nice tool to evaluate your relationship with your vendors to determine how well you collaborate to drive business results.While he talks about the seller/vendor relationship at a strategic level, the “business results” he refers to include product, merchandising, pricing and promotional strategies. These all depend upon available inventory to work.
E-Commerce — Focus On Fulfillment – Robert Pearson, VP of eCommerce for Best Buy Canada states, ” If the e-commerce system is not properly integrated into the supply chain software, and the visibility is not there, you will end up with an unhappy customer. That is the single largest danger of not keeping up with technology in the eCommerce and supply chain spaces. When customers place the order, they expect to get the product. An email three days later saying the product is out of stock will only earn you an angry customer. As I said earlier, all of this relates to customer service.” I couldn’t have said it better myself!
Consumer Goods Executives Focused On Transforming Their Businesses: KPMG Survey – This article provides some great statistics around the state of supply chain integration in the consumer packaged goods industry. Only 29% of executives interviewed in the survey cited that their supply chain is fully integrated across the business and all channels. What was more interesting to me was that he describes supply chain not a one time activity or project, but a “coordinated set up independent initiatives” that contribute to business transformation.