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73% Of North American Retailers Worry About New Product Forecast Accuracy Featured

73% Of North American Retailers Worry About New Product Forecast Accuracy

The constant shifting of both old and new products throughout the supply chain can make planning and execution quite unpredictable for retailers. Case in point: as many as 73% of North American retailers are concerned about forecasting for new products, well above the average rate of concern among global retailers (58%), according to research from Martec International and RELEX.

Since most new products are developed and launched in the U.S., this merchandise overload and uncertainty may cause greater problems for North American retailers than those in other markets where there is typically a lower proportion of new products in an assortment.

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Forecasting isn’t the only supply chain issue where North American retailers express more concern than their global peers. These retailers see the increase of inventory availability without increasing stock holdings (67%) as a top business issue, compared to 62% across all countries.

The research study, titled: State of the Retail Supply Chain 2016, analyzed retailers with revenues in excess of $110 million per year across North America, Germany, the UK and the Nordic countries.

Disconnect In Promotion Management

Despite 64% of all retailers highlighting the management of promotions as another major challenge, only 35% have a system in place that can build automatic demand forecast for promotions. Even worse, only 22% have a system that can manage promotion stock runs to clear fixtures for the next promotion.

The lack of quick automated reporting systems doesn’t appear to help matters, regardless of whether concerns arise in product forecasting, stock holding or promotions management. Overall, retailers spend an average of 79 minutes preparing a standard report and 110 minutes preparing an ad hoc report.

Retailers as a whole recognize that they have some distance to go before their supply chains are fully visible, giving themselves an average ranking of 6.2 out of 10 for supply chain visibility. Small format specialty retailers ranked themselves lower than any other retail category when it comes to this visibility (5.6 out of 10), mainly because their orders are generally placed many weeks or months in advance with overseas suppliers.

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