Here are the keys to an effective supply chain.
It’s 2021, so you’d think that working on retailer-supplier relationships should be a no-brainer, right? Well, that’s debatable.
‘Kane Is Able’, a large logistics company based in the US, conducted a survey and found that there are still many communication gaps within the industry, from simple honesty, to admitting errors, to cheating, to the technical aspects of the retailer-supplier relationship, affecting their efficiency on B2B portals and operations at large. Putting the relationship under a microscope, there are 3 key pain points for retailers to look at in improving interaction and maximizing their supply chain.
Demand Forecast is THE key. Slow turning inventory, customisation, challenges to meet customer service expectations and so on are prominent issues for both suppliers and retailers today, and if not executed well they are bound to lead to an underperforming supply chain. These result from poor forecasting accuracy and ineffective planning processes that are slow to respond to the changing market demand post-Covid. Resources and capital that were supposed to nurture growth become clogged and supply chain becomes a problem. Start by reviewing the current level of forecast on a regular basis and set goals and review processes. Measure, report and repeat, a lot. Generating data reports is a fundamental way of producing accurate analytics in the long term. Due to this, you’ll be able to provide accurate advice to employees and partners, building a more trusting relationship within the business as a whole.
Be honest. When you start a new supplier-retailer relationship, be open about your brand’s expectations, goals, and vision. No one can help you reach your goal if you keep that a secret. Expected sales, payments and customer service expectations are all pillars that have to be discussed in initial conversations in order to build a successful relationship and break down future communication barriers.
Always align internally. The degree of alignment between the retailers’ purchasing supply chain teams can also lead to big communication gaps. Start letting employees know how they’re doing, integrate frequent reporting and don’t forget to be empathetic. Set the business goals out clearly and remind them along the way. Whether along the supply chain or at large, this is a key practice for any business relationship.
Why is forecasting THE key though? A better, more analytical forecast can highlight gaps between financial performance targets, predicted sales and operating plans so that actions can be taken to address all of the above. Companies have started using an ERP software as a forecasting tool, however, this tool fails to recognize accurate retailer behaviours such as order policies and advance bulk buying. Because businesses vary, companies need forecasting tools that take these dynamics into account and are customized to the unique traits of each product category. A better look into Kingpin B2B and its focus on removing those pain points is a worthwhile read. Learn more about it in our blog here.
Forecasting demand and planning processes described above are essential for an effective and responsive supply chain, while also clearly driving other benefits for retailers. With better communication, retailers, manufacturers and suppliers alike can coordinate their inventory, their pending, their understanding of each one’s goals and thus build an efficient supply chain that provides better product results to consumers. And that’s the end result we all want.