Inventory / Merchandising / Supply Chain - Retail TouchPoints - Retail TouchPoints Tue, 15 Oct 2019 17:19:48 -0400 RTP en-gb As Supply Chain Issues Mount, Rent The Runway Pauses Membership Program Until Oct.15 As Supply Chain Issues Mount, Rent The Runway Pauses Membership Program Until Oct.15

Rent the Runway will not accept new members into its clothing rental program until Oct. 15, according to a note posted on the company web site. The pause comes as the fashion rental company faced a deluge of customer complaints related to delayed deliveries in recent weeks. The issue has become so severe that the company also announced that Chief Supply Officer Marv Cunningham would depart from Rent the Runway at the end of the month.

Co-Founder and CEO Jenn Hyman sent an email to current subscribers the morning of Sept. 27, saying: “The delays, which began Sept. 13, are due to unforeseen issues associated with a significant software transformation that we are executing in our fulfillment operation. Our technical team is working to fix these issues as quickly as possible.” In a conversation with Bloomberg, Hyman revealed that the problems started when the company installed new software in its New Jersey warehouse, directly impacting the number of orders that could be shipped each day.

The company also revealed that it will issue full refunds and give an additional $200 in cash to customers who made a one-off order but had it canceled because of the supply chain problems. Hyman told Bloomberg she didn't feel it was right to only offer credit to spend at Rent the Runway. 

Customers will not be able to order one-time rentals until Oct. 15. While shoppers will continue to receive their subscription orders, there may be delays of an additional one to two days until Oct. 15. The note advises shoppers to order “a few days in advance of your normal schedule.”

Any order that has already been placed for delivery on or after Oct. 7 will be shipped.

The supply chain issue certainly must have caught the attention of the numerous retailers that have adopted similar subscription-based rental models, such as Bloomingdale’s, Urban Outfitters, Banana Republic, ExpressAmerican Eagle, Ann Taylor and New York & Co. 

The Rent the Runway services include an “Unlimited” plan, which allows users to rent four garments at any given time with the option to swap them for $159 per month, as well as an “Update” plan for $89 per month that allows customers to rent a single set of four items monthly. Earlier this year, Rent the Runway debuted rentals of home goods with West Elm and added a children’s clothing rental option.

]]> (Glenn Taylor) News Briefs Fri, 27 Sep 2019 17:14:41 -0400
The Now Economy Is Booming. Is Your Supply Chain Ready?

0aaaKatie Kinraid BluJaySolutionsIt’s increasingly evident that the customer experience is driving the retail evolution and continuing to create new challenges for businesses across the globe. With consumer expectations at an all-time high, businesses are expected to know exactly who their customers are, what they want, and how to create a competitive experience that will rise above the rest.

For instance, services like Amazon Prime, Uber and DoorDash are setting a precedent for immediate communication from merchants, and customers are growing accustomed to lightning-speed service as a result. Operating in what has now been dubbed the “Now Economy,” it’s clear that businesses, and their supply chains, must evolve from traditional practices and reach consumers in a fast and cost-effective manner. 

As consumer demands have skyrocketed and purchasing behaviors have radically shifted, old business tactics are rendered inadequate. This makes it that much more important for merchants to get to know the new wants of their evolving customers and to offer a competitive purchasing experience. An in-depth understanding of customer purchasing behaviors helps businesses understand how they can meet these expectations and deliver goods closer to the moment of need.

The instant-service mindset carries forward to the delivery of goods, and retailers in particular must accommodate customers’ ever-increasing demands. Providing a favorable customer experience is no longer just a competitive advantage, but the difference between staying relevant in a changing landscape or falling behind in the industry. As customers become more empowered with a plethora of options, retailers oftentimes only have one chance to wow shoppers with a one-of-a-kind experience.

Expediting The Last Mile

When it comes to predicting what customers want, having a deep understanding of consumer purchasing behavior is key. Businesses are even starting to implement tools to stay two steps ahead of the purchasing process. Take for example the tactic of anticipatory shipping, which leverages analytics and algorithms to place an order before a consumer even adds the product to their cart.

By understanding these shifts in purchasing habits, businesses can leverage this knowledge to complete a majority of the purchasing transaction, leaving only the last mile of delivery to manage. This greatly expedites the shipping timeframe and in turn exceeds customer expectations for speedy and convenient delivery.

The Ultimate Fast Delivery

Retailers can utilize customer preferences not only to initiate the purchasing process and expedite the last mile, but also to create a competitive customer experience in other ways. A prime example is Amazon’s Treasure Truck, which loads trucks with awaited, must-have items and drives around towns in the U.S. alerting customers via text message. Having desired items just a short walk or drive away is a powerful tactic in the age of instant gratification and demonstrates the power of using technology to stay a few steps ahead. Afterall, the only thing better than one- to two-day shipping is no shipping wait at all.

Quality Remains Key

It’s clear that speedy delivery is no longer a “nice to have,” but the bare minimum for retailers to remain successful in the Now Economy. However, expedited timeframes translate into more challenges to ensure quality while meeting expectations.

Sales events such as Amazon Prime Day are a great opportunity for businesses to capitalize on a surge in demand, if and only if they are prepared to manage a sudden uptake in business. During this year’s Prime Day, some businesses reported up to a whopping 64% increase in digital sales during the event. However, a majority of retailers are struggling to reap these benefits, and it’s not uncommon for some to fall short of the quality expectations of customers. As consumers have become hyper-sensitive to these experiences, businesses typically have one chance to get this right.

In the booming Now Economy, businesses will need to carefully analyze the state of their supply chains and consider next-generation tools that will allow them to deliver on a superior customer experience. While this will inevitably be a challenge for the industry, those that master a deep understanding of their customers will rise above the rest and reap the benefits of their loyalty.

Katie Kinraid is General Manager APAC at BluJay Solutions, a leading provider of supply chain software and services powered by the world’s first Global Trade Network. BluJay’s customers are some of the world’s most progressive retailers, distributors, freight forwarders, manufacturers and logistics service providers.

]]> (Katie Kinraid, BluJay Solutions) Executive ViewPoints Fri, 27 Sep 2019 09:00:51 -0400
Lucky Brand Leverages Operations Data To Improve Inventory Visibility Across 200+ Stores Lucky Brand Leverages Operations Data To Improve Inventory Visibility Across 200+ Stores

With a network of 200+ stores that fulfills almost half of the denim company’s online orders, Lucky Brand sought new technology to improve its cross-channel delivery operations, starting with inventory visibility. Mike Relich, COO of Lucky Brand, described the previous backend retail operations at the company as “opaque,” prior to working with operations data platform SoundCommerce.

Now, Lucky Brand has greater transparency into processes such as:

  • Length of time taken for a specific product to be picked, delivered to the UPS hub and delivered to the customer’s doorstep;
  • Potential profitability of transactions and individual shoppers, and customer lifetime value (CLV); and
  • Specific failures or roadblocks in the delivery process, and where they can be improved.

{loadposiion GIAA}“We didn’t have a whole lot of visibility into the number of orders that we captured,” Relich said in an interview with Retail TouchPoints. “We didn’t know for sure whether all those orders made it into our OMS [order management system]. There are two components related to the OMS — ship-from-store and ship-from-distribution center — and approximately 45% of our e-Commerce shipments are actually ship-from-store. It’s very easy to manage one DC, but to manage 200 stores shipping e-Commerce is a little bit more of a challenge.”

Relich noted that visibility problems within the order delivery process persisted, starting with Lucky Brand’s interactions with its delivery carriers. Despite having labels printed, both the retailer and consumers were sometimes in the dark about precisely where products were during the delivery process and when they would arrive at the shopper’s home — sometimes even having different expectations of when a product would ship.

“The problem the stores had — and even the DC for that matter — was that the store might go into UPS CampusShip, create a label, and then employees would assume that the item is actually shipped out,” Relich said. “But they wouldn’t know how long it will take for the UPS driver to pick up the item and take it to a UPS hub and scan it in. From that scan-in, how long does it take to get to the customer’s doorstep? We never had the visibility.”

Cross-Platform Shopper Data Bolsters Delivery Visibility

Gaining more access to granular customer data has been critical to Lucky Brand’s ability to improve product visibility across the supply chain. The SoundCommerce software pulls operations data from across merchandising, supply, fulfillment, delivery and customer service platforms such as Amazon, Shopify, Magento, Salesforce Commerce Cloud, StitchLabs, Oracle NetSuite and Microsoft Dynamics 365.

SoundCommerce, which launched in April 2018, is largely focused on helping retailers remove the “middleman” within the operations process, by giving its clients the customer data necessary to answer tough questions such as “Which markets, channels, and customers should we prioritize?” and “Are we meeting our delivery promise?”

While the technology helped build the solution provider’s partnership with Lucky Brand, it was Relich’s working relationship with SoundCommerce CEO and Co-Founder Eric Best that got it off the ground. Relich served as CIO at Westfield, and was one of the first clients of another company Best founded, Mercent (since acquired by CommerceHub).

When Relich reconnected with Best at a recent NRF Big Show, Best pointed out that “you rely on all these cloud-based technologies, but you have no way of getting a single view across all of them.” Realizing that operational excellence and limited resources had been an issue at Lucky Brand, Relich elected to be a beta tester for SoundCommerce in May 2019.

Lucky Brand Improves Customer Profitability Assessments To Measure Lifetime Value

Beyond bolstering backend visibility, Lucky Brand can more accurately diagnose how to improve customer lifetime value (CLV) among individual shoppers. Within the SoundCommerce solution, the retailer can factor in transactional data such as shipping costs, cost of goods sold (COGS) or even marketing costs, and then pull data from across its other platforms to assess profitability per transaction and profitability of individual customers.

“Let’s take Black Friday for example, or one of those days where demand exceeds our capacity to pick items on the same day,” Relich said. “We pick those orders first-come, first-serve — but maybe we should be picking these and prioritizing by who our most valuable customers are so that those get out first. Secondly, let’s take the brand-new customers and make sure they got the greatest experience.”

CLV can decline, sometimes precipitously, when shoppers are unhappy with a purchase or their overall shopping experience. With the streamlined operations platform in place, Lucky Brand can focus on how specific events may change CLV in the long run. Relich and his team can use this data to pass more investment ideas through to the retailer’s finance department.

“Sometimes we have to cancel orders because the inventory’s not correct,” Relich said. “Basically, we really didn’t know what an operational failure really meant to that customer. Now that we’re tracking CLV, we can specifically see any CLV changes because of the lapse of the service. If we know that a shopper’s CLV is $250 and it dropped to $200 after that failure, we know that this instance cost us $50 in goodwill from that customer.”

Learning more about these data points has given Lucky Brand a fresh point of view on how to understand the value of its consumers, while also enabling the retailer to better communicate with them at the right time. For example, the company sends emails if an order is delayed, or if it will be shipped from a different store than initially anticipated.

“You want to ship as fast as possible, but customers are a lot more accommodating as long as you communicate with them,” Relich said. “They’re much more forgiving than if they don’t hear anything from you. Then they will think you don’t have your act together.”

]]> (Glenn Taylor) Retail Success Stories Wed, 25 Sep 2019 08:00:00 -0400
The Three Essential Tech Tools Every Retail Delivery Fleet Needs

0aaaKhaled Naim OnfleetFor a retail business running its own in-house fleet, the right tools can make a huge impact on efficiency, margins and customer experience.

I’ve talked with thousands of fleets during my four years in this space, as co-founder of Onfleet, and in those conversations some common themes have emerged. The most successful delivery operations all seem to use these three essential tech tools.

Recruitment Platforms

Let’s start at the top, with driver recruitment. With unemployment rates low throughout the U.S. and turnover generally high among drivers, it can be tough to fill these positions and keep them filled. Craigslist ads don’t always cut it, and they force your recruiters to wade through a lot of junk in order to find and screen the best candidates. One fleet we spoke with described recruiting drivers as a hamster wheel they are continually stuck in.

That’s why a lot of fleets are turning to gig economy recruitment platforms like Wonolo or BlueCrew that find and prescreen candidates for you. They take the majority of recruiting duties off your plate, so you can concentrate on other things. Their fees are well worth it when you consider it can take several hours to recruit just one driver. Many fleet managers are also using tools like Fountain to manage the hiring funnel effectively.

Background Check Software

For many businesses, the delivery is the only in-person interaction they have with a customer — making a good delivery experience essential. That’s why background checks (including driving record and criminal background checks) are a must for all drivers.

But how to go about background checks compliantly? No need to study up on employment law — this is easy to outsource to a third party. These companies have all the tools required to do a thorough and compliant background check, quickly, to help ensure that these frontline staffers will be good ambassadors for your company. Checkr is one example of a background checking platform that has gained significant traction in the gig economy.

Fleet Management Software

This may be the most important piece. I’ve met with many fleets that are handling fleet management manually, using spreadsheets to plan out delivery schedules and Google Maps (or worse, gut feel) to plan routes. Both of these are extremely inefficient, and fleets that take this manual approach inevitably have drivers who are either overloaded or have too much free time. Fleet management software will help you with route planning, dispatch, communications and analytics.

We recently worked with a supermarket chain that had moved from spreadsheets and Google Maps to fleet management software. The e-Commerce manager told us that the company was able to increase delivery capacity by 50% without adding any additional drivers or vehicles, due to more efficient planning brought about by the software.

Some fleet management software, like Onfleet, can also help with customer communication, providing customers with timely and accurate information on exactly when their delivery will arrive — not a two- or four-hour window, but an accurate real-time ETA.

All of these tools are either web-based or SaaS, so they don’t require a ton of technical knowledge. The time savings they’ll provide — many hours a week — will help business owners and managers spend more time on customers and less time managing delivery operations.


Khaled Naim is CEO and Co-Founder at Onfleet, the most advanced cloud based software platform for managing last mile deliveries. Onfleet powers millions of deliveries per month for thousands of businesses around the world. Naim holds an MBA from Stanford’s Graduate School of Business and a BE in Computer Engineering from the University of Michigan. He is based in San Francisco.

]]> (Khaled Naim, Onfleet) Executive ViewPoints Mon, 23 Sep 2019 08:58:01 -0400
BBQ Guys Optimizes Shipping Choices To Streamline Fulfillment Processes BBQ Guys Optimizes Shipping Choices To Streamline Fulfillment Processes

Maintaining clear communication is vital to retail success, but this can be a challenge for fast-growing companies with an expanding roster of suppliers, workers and carriers that need to stay in touch through a range of channels. In the case of BBQ Guys, this has meant continuously connecting hundreds of suppliers while maintaining 15% to 20% annual revenue growth for nearly 20 years.

“Whether it's from a customer standpoint, a vendor standpoint or a supplier standpoint, no matter who it is, we always want to be easy to do business with,” said Corey Tisdale, CEO of BBQ Guys in an interview with Retail TouchPoints. "We've grown to over 600 suppliers, and we always did business with these suppliers however they wanted in the past, so we had basically 600 different processes that were all variations of a similar theme. We got to the point where being able to effectively communicate in a timely fashion with all of our vendors and customers was really becoming a struggle because of how fast we're growing.”

Accurate communication is particularly important for a retailer like BBQ Guys, which regularly splits its shipments between parcel and freight. The problem is that many solution providers are geared towards only one or the other type of shipping. BBQ Guys rose to this challenge by implementing a system that connects vendors with a shipping company that is well-suited to handle each delivery, whether it’s as small as a spatula or as large as a grill.

"A lot of our stuff is big and goes freight, and for our suppliers to have to ask what the deal is — ‘Hey, every time you go to send a shipment, can you get quotes from five different freight companies and ship it with whoever's the best match for this particular shipment’ — that's a lot of work,” said Tisdale. “To even call and schedule all of the people to come pick up the stuff at the right time is a lot of administrative burden to put on a supplier, and we didn't want to do that.”

The retailer partnered with Logicbroker to optimize sourcing and relationships with vendors, and connected the solution provider’s platform with Convey, which automatically determines the optimal shipping company, generates the paperwork and schedules the freight pickup. The two technologies helped generate a significant increase in efficiency, which enabled BBQ Guys to process 22,554 shipments in May, 11% more than May 2018.

BBQ Guys receives the relevant information in a standardized format that helps the company cut down on its number of processes and quickly respond to problems like out-of-stocks or shipping delays. The streamlined system has simultaneously reduced the administrative burden, the number of clerical errors and the time it takes to respond to an issue.

The tools also help BBQ Guys improve delivery over time. The centralized nature of the data lets the company easily pull out both specific instances and aggregate information about fulfillment times, customer experiences and other relevant statistics, letting the company rectify any negative experiences before they result in a lost customer.

Customers also benefit from the system when everything is going well. They can now track their shipment across all modes of transportation and carriers used, regardless of how many individual shipments make up their total order.

"Every customer gets notified in the way that they want to be notified, at the frequency they want to be notified,” said Tisdale. “Nobody has to do anything extra to make that happen, because everything from the time that we start fulfillment to the time it gets delivered to the customers is automated."

]]> (Bryan Wassel) Inventory / Merchandising / Supply Chain Wed, 24 Jul 2019 08:53:15 -0400
How Retailers Can Compete With Amazon At Its Own Supply Chain Game

0aaaAndrea Morgan-Vandome CelectWhile few things remain constant in retail, the customer always comes first. And in today’s Amazon Prime world, customers demand faster, cheaper and more convenient fulfillment options than ever before. Retailers are scrambling to keep pace, offering everything from pre-selected delivery slots and buy online, pick up-in-store (BOPIS) to two-hour delivery windows in an effort to provide the seamless, channel-less experience customers expect.

Yet retailers are struggling to accurately determine what, when, where and how much customers will buy. To beat this real-time “last mile” supply chain challenge and successfully compete with Amazon, retailers must take a page from the retail giant’s own playbook and leverage their stores as one unified distribution center to achieve massive margin gains. 

The Evolution Of Fulfillment And The New Ship-From-Store Model

Historically, online order fulfillment has been accomplished through either large fulfillment centers or store-based fulfillment via stiff, rules-based order management systems, where inventory was either pulled from the store closest to the customer or a store with the lowest shipping costs.

While this approach works in theory, the reality is that the retailer often suffers as costs escalate. Either additional inventory is stockpiled or stores must manage resulting inventory dilemmas. For example, stores with high inventory turnover become under stocked and cannot cover walk-in demand, while stores with slower inventory turnover become overstocked and vulnerable to unplanned markdowns. Last year alone, U.S. non-grocery retailers lost $300 billion in revenues due to markdowns — which were primarily driven by inventory misjudgments. 

With the success of Amazon and the need for faster, more cost-effective order fulfillment, many traditional retailers have turned to “ship-from-store” methods using store inventory to fulfill online orders. The majority of these companies are adopting a combination approach leveraging distribution centers (DC) and stores. While this approach enables more flexible delivery capabilities and considers cost, it has also introduced two new challenges:

Inventory Uncertainty: With more ways for customers to buy, receive and return goods, demand prediction and inventory management can seem like voodoo science. Retailers struggle to understand if a particular store will have enough inventory to satisfy in-store demand first, let alone accurately pinpoint which store locations will have too much inventory of a particular item that won’t sell in-store and instead should be fulfilled for online orders.

In-Store Sales Cannibalization: By fulfilling online orders using in-store inventory, retailers run the risk of negatively impacting in-store sales. Without an accurate, real-time view of demand across channels, it is incredibly hard to predict if an item will sell well in a physical store vs. online — and when this could change or reverse.

Demystifying Demand With Artificial Intelligence And Machine Learning

Retailers need to clearly understand how to best use store inventory and take advantage of location to maintain the edge they need to compete in today’s retail environment. If done correctly, ship-from-store fulfillment not only addresses customer expectations, but also helps retailers avoid markdowns and lost sales, decrease fulfillment costs and increase full-price sales.

Retailers can gain a more accurate view of demand across stores and exceed customer expectations by harnessing the power of artificial intelligence (AI) and machine learning (ML).While 86% of retailers see the value in advanced analytics, retailers have long struggled to effectively use analytics. It is difficult to predict true demand based on sparse or incomplete data and lack of real-time context (such as available assortment and upsell and market trends) — especially at scale.

However, thanks to recent technology advancements in AI and ML, retailers now have ways to evaluate millions of data points at once to help quickly identify the overall opportunity cost of each potential fulfillment scenario. With this, retailers gain critical insight about where to ship from in order to best utilize the inventory — helping them maximize gross margins and sell-through.

In addition, technology advancements now also enable robust optimization capabilities that can help retailers solve a wide range of critical merchandise, planning, allocation and fulfillment challenges. With the ability to optimize across multiple (and often competing) objectives, retailers can better predict the best fulfillment strategy based on product availability, likely demand, capacity constraints, shipping costs, delivery timing and more. 

For each fulfillment decision that needs to be made, advanced optimization can account for the overall margin profitability and customer satisfaction by identifying the immediate payoff versus the long-term opportunity cost — instantly. Not only has effective fulfillment become a scientific game of advanced analytics, but it also must now play by the rules of the Amazon-driven era of urgency. 

Winning The Supply Chain Game

Inventory continues to be both retailers’ largest liability and greatest asset. In today’s volatile retail market, there is absolutely no room for guesswork or reliance on backwards looking data. By embracing the predictive analytics afforded by the AI/ML technology era, retailers can optimize inventory and modernize supply chains. In fact, omnichannel retailers can successfully meet consumer demand across ALL channels and stores — and beat Amazon at its own game. 


A seasoned retail tech leader, Andrea Morgan-Vandome’s experience across marketing, product, sales, customer relationships and market strategy has driven the success of both industry giants and innovative startups. As the CMO of Celect, she leads the development of strategic marketing efforts to expand the company’s product suite in the retail space. In her recent role as global vice president Cognitive Solutions at IBM Watson, she led the delivery of the first repeatable artificial intelligence and machine learning offerings and drove the product strategy, user experience and go-to-market approach for Watson solutions. Before joining IBM, Morgan-Vandome served as global vice president of cloud and global vice president of strategy and solution management at Oracle Retail, where she worked with retailers around the globe on merchandising, planning, inventory, supply chain, omnichannel and store challenges. Earlier in her career, she led strategic product and marketing initiatives at various startups including Retek, Connect3 Systems and StorePerform Technologies.

]]> (Andrea Morgan-Vandome, Celect) Executive ViewPoints Tue, 23 Jul 2019 09:10:28 -0400
Boutique La Vie en Rose Implements Unified Systems To Fuel International Growth Boutique La Vie en Rose Implements Unified Systems To Fuel International Growth

Earlier this year, executives at Boutique La Vie en Rose realized that its backend systems weren’t capable of supporting the retailer’s plans for growth. While the technology infrastructure for the Canadian lingerie, loungewear and swimwear retailer had been adequate for decades, healthy omnichannel growth required replacing legacy systems with more modern tools.

“We are moving away from an Excel-based environment that requires manual input to an enhanced solution that will allow our business to flourish,” said Éric Champagne, Chief Information Officer of Boutique La Vie en Rose in an interview with Retail TouchPoints. “I tell my team that this is like a pair of comfortable jeans, which is fine occasionally, but sometimes you need to go to a black-tie event.”

To “suit up,” the retailer deployed a unified system consisting of the Techni-Connection integrated solution with CGS BlueCherry PLM and the Cegid Retail Management & POS Solution. The combination is improving data flow and communication with vendors, as well as providing transparency into logistics and offering new tools for management.

The improved automation will help Boutique La Vie en Rose expand its international presence, which includes 275 locations in 17 countries and an e-Commerce site in the U.S. The efficiency gained by automating standard operations will be a key element for enabling this growth.

“Right now, any added new country means we have more manual requirements,” said Champagne. “In managing different countries, as well as distribution channels, we need a simplified process, as well as a better understanding and flow of data. For example, to be present in other countries we need an international solution that offers multi-language, multi-currency functionality and meets local fiscal requirements, such as taxes and GDPR.”

Moving away from manual processes also will help align the company’s everyday operations with its financial planning goals. The PLM tools will standardize design, development and vendor collaboration, while the unified system will make it easier for Boutique La Vie en Rose to upgrade other solutions in the future.

The company already has a five-year digital transformation program underway, which aims to offer shoppers a seamless user and customer experience across channels. One of the immediate goals is to align customers’ online profiles with their past purchases and interests, both online and in-store, improving personalization capabilities.

The new system also will put Boutique La Vie en Rose in a better position to take advantage of new technologies going forward. Both customer-facing technologies like AR and VR, and backend enablers such as AI and machine learning, could be further enhancements in the retailer’s future.

“While AI is a buzzword, there may be potential integration in the future,” said Champagne. “Whatever the latest new innovation the customer wants and needs from us, we’ll be able to integrate it. Tech is moving much faster than ever before and we want to be able to easily, quickly react. With upgraded systems, we will benefit from the changing tech landscape.”

]]> (Bryan Wassel) Inventory / Merchandising / Supply Chain Tue, 21 May 2019 08:22:12 -0400
TrueCommerce Acquires Supply Chain Management Platform Provider ecUtopia TrueCommerce Acquires Supply Chain Management Platform Provider ecUtopia

TrueCommerce has acquired fellow cloud-based supply chain collaboration and visibility platform ecUtopia for an undisclosed sum. With the acquisition, TrueCommerce gains a strategic technology service that strengthens its commerce network in several market segments, specifically home furnishings and apparel.

The TrueCommerce solutions are designed to help retailers connect their business across the supply chain under one global network, integrating processes including Electronic Data Interchange (EDI), inventory management and fulfillment, as well as e-Commerce hubs such as digital storefronts and marketplaces.

There are no immediate plans to rename ecUtopia, but the company will be rebranded under the TrueCommerce banner.

TrueCommerce, based in Pittsburgh, plans to integrate the ecUtopia operations into its own “where it makes sense,” according to a company Q&A posted on its web site. The ecUtopia San Diego office will operate as another Center of Excellence for TrueCommerce customers.

The companies will determine when and how they can extend TrueCommerce’s catalog of products and technologies to ecUtopia customers and offer additional services designed to help improve supply chain operations. In addition, the companies will immediately evaluate incorporating ecUtopia's platform and technology into the TrueCommerce Foundry platform.

]]> (Glenn Taylor) Mergers & Acquisitions Tue, 14 May 2019 12:59:22 -0400
How Retail Inventory Efficiency And Accuracy Impacts The Customer Experience

0aaaCarla Anderson OracleRetailAs omnichannel retailing requires greater and greater precision, the stakes surrounding inventory accuracy — or the lack thereof — are increasing dramatically.

According to a report from the International Council of Shopping Centers, an estimated 151 million people visited a mall or shopping center over 2018’s Black Friday weekend. The vast bulk of spending volume for the weekend — 88% — went to omnichannel retailers, i.e. brands with web sites the consumers at least had the opportunity to shop before entering the store.

So far, no surprises. We were expecting a big shopping weekend, most retailers are at least trying to be omnichannel these days, and we know consumers increasingly do product research on the web site before making their instore purchases. Slightly unexpected, however, was this: 27% of those holiday shoppers were in the store to pick up a purchase they’d already made online. Of those click and collect or buy online pick up in-store (BOPIS) customers, almost two thirds — 64% — made one or more additional purchases while they were in the store.

While these numbers are possibly skewed a little by consumers’ urge to nail down a Black Friday special, it seems clear that click and collect represents a genuine and growing sales and customer loyalty building opportunity. Well, it does only if you’re good at it. Here are two questions retailers should ask themselves:

  1. When the customer comes in to collect the order in your store, is the item there and ready for pickup?
  2. Do you have a simple, customer-friendly process? In other words, can the BOPIS customer make their pickup without having to stand in a checkout line and is it easy for your customer to find the pickup area?

When It Goes Wrong

Here’s an example of what can happen when the answer to either of those questions is no. I recently spoke with a friend who’s a long time customer of a large, well-known chain with a very good reputation for customer service. She called the store nearest to her recently and asked for an item she needed for an upcoming trip; she was told it was in stock, gave them her credit card number, and arranged to pick it up on her way to the airport. It will be, she was told, at the special services desk.

When she arrived at the special services desk, not only was the item not there, they had no record of the transaction. They sent the customer upstairs to the department the item would have come from, where there was also no record of the transaction. So she was sent to yet a third place, with the same result. After 20 minutes of this, she left the store empty-handed but with a lot of frustration, and went to the airport. Eventually somebody at the store found her purchase and sent it to her, along with an apology and a store credit. She’s shopped with this company for years, and is still a semi-loyal customer.

That’s the good news. The bad news is this: every day, on her way to work, she passes within a hundred yards of the mall entrance for that store. “I’ll still use them for particular things, but to click on something and pop in and get it? I’m like, no way. I don’t have 20 minutes to spend chasing around.” In other words, she’s not giving them another chance when it comes to click and collect.

The Empowered Associate

Multiply that one instance by the number of people now trying click and collect — nearly 36 million of them on Black Friday weekend, according to ICSC’s numbers — and you have the potential for a lot of lost opportunity. The question is, how do you prevent that from happening?

I’m tempted to say technology — my employer, after all, is a company that develops technological solutions for the retail industry — but that’s only part of the answer. The retailer in the story above, for example, is by no means averse to technology; they were one of the first to put a tablet in the hands of their associates. What may have happened is that they thought, okay, we’ve done that; check the box and move on.

This is not a new story in retail. Retailers, and not for groundless reasons, tend to have a real fear of failure. Trying something new, at least in a pilot program, is common; rolling out to their associates usually follows the pilot; however, ongoing investment in it, making changes as the business and the customers change, is less common. Giving associates (or customer service representatives) the autonomy paired with the right tools and current, necessary information to handle a customer order from end to end is also fairly uncommon. I have seen a few examples of brute force making click and collect ‘work,’ but that is not a long term, scalable solution.

The Loyalty System

The point here is that the associate, the autonomy (“I can fix this for you, ma’am”), and the data the associate is working from are not freestanding elements; they’re part of a larger system. And the purpose of the system isn’t just to save a sale on a Black Friday special. It’s to cement the customer relationship. It’s to build loyalty with that customer so you are first in mind for their shopping decisions. It’s to enable your employees to do the best they can.

And the purpose of a loyalty system is customer retention. According to figures from conversion rate specialists Invesp, it costs five times as much to attract a new customer as to keep an existing one — even with the occasional appeasement. Compared to new customers, existing customers are 50% more likely to try new products, and to spend 31% more money.

If you’re a retailer and you’re offering click and collect, the in-store pickup is a make-it-or-break-it moment for customer loyalty. If it’s not easy, if the first associate the customer encounters can’t find the item, or worst of all if the item isn’t really there in the store, you’ve lost a customer.

Where Is It?

The core of this system we’re talking about — the thing you have to have to make it work well — is inventory accuracy. Which is a lot rarer than it needs to be. According to the Auburn University RFID Lab, the average level of inventory accuracy for U.S. retailers is 65%, meaning that more than a third of the time, the average retailer can’t tell where a particular item is, or whether they even have it in stock.

If you’re one of those retailers — maybe even one of the ones below 65% — this isn’t a criticism, or necessarily a problem. It’s an opportunity. Let’s just say a 3% improvement in inventory accuracy delivers a 1% overall sales lift. If a store managed to get from 65% accuracy to 93% — which, with the right systems in place, is totally doable — it would net a 9% increase in gross sales, with no other investment required.

It would also vastly improve your ability to execute an omnichannel strategy. If you don’t have 90%+ inventory accuracy, and you don’t have your merchandising and inventory data tied together and easily accessible to everyone who needs the information, you’re handicapping yourself in today’s — and tomorrow’s — retail market.

Single View Of Inventory

For example, retailers such as John Lewis — the largest omnichannel retailer in the UK — realized it was time to embark on a journey to a single view of inventory in order to meet the growing expectations of customers for convenience, choice and experience. They were finding multiple versions of stock information across their various systems and decided to make a change. “John Lewis wanted to implement a full end-to-end solution that fully integrated with the supplier. The new process would give us the information around a product and ability to launch a product online. Fundamentally, the benefits we’re driving will increase the speed to market with a seamless process working with new and existing systems,” said Susan Young, Head of Merchandising Strategy at John Lewis Partnership.

If retailers want to ensure their customers keep coming back, having a customer-friendly BOPIS process seems to be a good start. And to start that BOPIS process off on the right track, they need to put in place the processes and the complementary technology for associates to truly handle a customer order from end to end.

Carla Anderson is Senior Director: Merchandising Strategy at Oracle Retail.

]]> (Carla Anderson, Oracle Retail) Executive ViewPoints Wed, 01 May 2019 08:00:00 -0400
Why The Retail Supply Chain Demands Digital Transformation

0aaaGraham Parker GravitySupplyChainDigital transformation is at the top of the agenda for many retailers; however, this is only the beginning of the retail industry’s efforts to embrace digital change. According to a 2018 report by SAP, only 22% of retailers investing in digital transformation were within the planning stage, and 55% were still running pilot schemes. Evidently, there was still a long way to go, as only 3% of retail businesses had completed digital transformation projects.

Consumer demand has shifted, with fast-changing preferences seeing consumers demanding the products they want, when they want and where they want them. Today’s consumer lives in an ‘always-on’ world, driven by connected technologies centered around convenience. The retail sector has been slow to keep pace with this changing consumer demand, and unless it can accelerate the pace of digital transformation, the gulf between consumer demand and satisfaction will only grow wider, placing customer loyalty at risk.

If retailers are to protect customer loyalty, and be able to both sustain and also increase sales, they must work quickly to reduce lead times and business cycles to get the products that consumers want, where they want them and when they want them.

The Business Case For Digital Transformation Of The Supply Chain

Attempting to digitally transform without a robust infrastructure in place is a virtually impossible task. Recently, a major U.S. retailer faced escalating complaints from customers who could not find the items they wanted because they were frequently out of stock; this was due to the retailer’s supply chain not being reliable enough to keep pace with what customers wanted.

In response, the management team decided to invest in the digital transformation of its supply chain, to shorten replenishment times, optimize deliveries, and ultimately be able to match supply with demand. Shortly after doing so, they were able to reduce retail cycle times by 20%, leading to increased sales. In future, they anticipate even better results, and the ability to achieve a 60% total reduction in retail cycle time.

However, this is just one example of how digital transformation, particularly of the supply chain, can help retailers meet the challenging demands of today’s consumer, generating business growth and success. The findings of significant research institutes also support this fact. Bain & Company found that retailers that integrate digital technologies into their supply chain rapidly improve service levels while cutting costs by up to 30%. McKinsey discovered that companies that strongly digitize their supply chain could expect to boost their annual growth of earnings before interest and taxes by 3.2% — the most substantial increase from digitizing any business area — and the annual revenue growth by 2.3%.

What Digital Transformation Demands

The business case for retailers to digitally transform their supply chain is compelling. The reason digital transformation can generate such impressive business results is that it provides retailers with the following game-changing capabilities:

  • Real time visibility across the supply network, allowing retailers to view the live status of products no matter where they are along the critical path, e.g. in production, in transit or in inventory; allowing data-driven decision making with certainty and ensuring the timely delivery of products.
  • Automation of time-consuming manual data entry, e.g. keying in data on bookings, purchase orders or sailing schedules. Automated operations streamline the workflow of supply chain managers, saving them hours of time and allowing them to focus on more value-added tasks, such as negotiating better vendor prices or implementing growth strategies.
  • Enhanced collaboration with all relevant stakeholders sees logistics providers, factories, global teams and departments all on one platform, enabling information to be shared quickly and easily, rather than being spread out across multiple sources such as spreadsheets or emails.
  • AI and ML capabilities enable businesses to predict what customers want before they even want them, and make supply chain optimizations to synchronize supply with predicted demand, with little or no need for human intervention. AI and ML will power ‘cognitive’ supply chains, the final phase of digital transformation. Reaching cognitive functionality will take time and requires digitization as the first step (e.g. the points mentioned above such as automating manual processes).

These features increase efficiency and speed to market, and allow retail companies to satisfy their consumers with timely deliveries.

Culture Must Change Too

A caveat to the discussion so far is that the digital transformation of the supply chain by itself is not enough to improve supply chain performance and take it to the next level. Retail companies must also create a workplace culture that encourages employees across the supply chain and buying floor to collaborate more, share data and not operate in silos, in order to take full advantage of the benefits that a digitized supply chain will provide. Both sets of employees exist to deliver the product to the consumer, and should be aligned and collaborating in tandem.

An Opportunity Not To Be Missed

According to the IDC, there is a gap within the retail sector between retailers that are starting to embark on the journey of digital transformation with a defined strategy, and others that are lagging with no clear goals on how to incorporate digital technology. The IDC warns that retail companies on the lower end of the spectrum are putting their competitiveness at risk; which is why it is critical that you don't get left behind.

A Staged Approach

Trying to digitally transform an entire supply chain in one phase can be a daunting and overwhelming prospect. The best way to start is by identifying and fixing the immediate weaknesses in the supply chain (e.g. time to market), with a long term goal to evolve in entirety. Once people in the organization start to see the benefits from digitally transforming those parts of the supply chain that need it the most, the process of digitizing the rest of the supply chain to achieve even more significant benefits will organically take place. Evolution comes from robust and proactive decision making, vision and openness to change, essentially trusting both the data and the source of the data. Real-time visibility begins to install the trust element, so the rest will follow naturally.

Gravity Supply Chain Solutions CEO Graham Parker has spent over three decades working in the supply chain industry and has seen first-hand how the traditional linear supply chain model has grown obsolete. Heading into the company’s fifth year, Parker is responsible for executing on the vision, leading the Board and the investor base. There are high expectations for the platform, and how Gravity Supply Chain can take its customers on the autonomous journey through digital supply chain management and on to cognitive supply chain management. Of equal importance is ensuring that the company provides a healthy, stable structure for all employees, so they realize just how integral each person is to help the company grow and achieve its targets and objectives.

]]> (Graham Parker, Gravity Supply Chain Solutions) Executive ViewPoints Thu, 18 Apr 2019 08:00:36 -0400