The speed and assemblage of integration in the retail supply chain is a matter of rising concern to many retail executives. This comes in pertaining to the growing pressures of industry consolidation; emerging new retail formats; difficulties in managing costs, stock-outs and markdowns; and the erosion of margins and profitability.
The outcome then that, retailers have started turning to technology for help with such challenges. During the same time, interdependencies among supply chain intermediaries have gone up in complexity and take place in a greatly time-compressed and more competitive environment.
Information technology in retailing
With much better and greater access to data and analytical tools, retailers now know that information technology has enabled them to answer increasingly complex questions related to retail strategy and operations. This has benefitted them as well as their customers, suppliers, and other partners.
Suppliers, partners, and upstream and downstream intermediaries are interconnected through real-time interfaces which rely on EDI and the open standards of the Internet. Along with the traditional technologies like scanners, barcode readers, and wearable computers, the recent trends tells us that importance of Internet-centric software and analytical tools which can diffuse critical and actionable retailing knowledge throughout an integrated retail organization.
Such tools help physical and online retailers and other supply-chain intermediaries to answer business-centric questions on a real-time basis. The tools also add data capture and storage technologies, with the ability to convert information into intelligence; re-defining retail IT solutions.
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Sources and potential uses of retail data
At the current stage of retail revolution and with the advent of digital transformation services, there are retailers who face an overabundance of data. This data is detailed and intricate. It refers to various types of transactions, at various levels of the organization, and in the broad retail supply chain, are widely available.
But, there is significant variation on how retailers capture, store, and use this data in their business decisions. Data capture happens at various different interfaces:
- Shipments to stores,
- Inventory and warehousing activities,
- Interactions between the retail outlet and its corporate headquarters, and
- Interactions with value chain intermediaries.
The data which is captured at such interfaces is invaluable, that enables numerous business applications. Thinking at the store level, it can also include tools that enable the capture and analysis of metrics such as size and growth trends, geographic breakdown of sales, store
performance and growth, and the success of new product introductions.
At the current stage in market, land-based and on-line retailers should make full use of this information-intensive business environment, so that they can deliver superior solutions to their customers, and at the same time also simplify their businesses process.
Solutions that stem out of information technology, help reduce costs, increase supply chain flexibility and response, integrate suppliers and partners, and ultimately provide a more effective shopping experience to the end customer. When retailers utilize and share the technology with key players in the supply chain, they can develop collaborative planning, forecasting, and replenishment programs.