As we look to round off what has been an incredibly disrupting year with the all-important holiday season, how is the retail industry likely to fair? Will the usually busy holiday season provide some much-needed relief to retailers feeling the pinch of a tough year, or will sales and profits continue to struggle? We analyse the figures and identify the key trends that will rule this year’s holiday season.

Overview

In terms of general outlook, the majority of experts are predicting the coming season to be positive in general, but with less growth compared to previous years. ICSC and CBRE both predict less than 2% growth in sales for the period, compared to the average of 4.1% we typically see in the holiday season. Considering the economic and social disruption of the past year this lower than normal increase is to be expected, but ultimately will cap off what has been several months of steady growth in both the UK and the US. If we look at consumer polls, the outlook is similar, with a survey from Maybe* finding that its ‘Christmas as usual’ for 71% meaning they plan on spending the same as in ‘normal’ years.  But the way customers, and indeed retailers, go about this holiday season looks to be very different from previous years.

Let’s take a look at some of the key trends for the upcoming holiday season:

An extended season

Black Friday is the event that kicks off the holiday season, typically meaning high discounts, crammed shop floors and long ques outside of stores. Due to the realities of the pandemic many retailers have extended their Black Friday offerings to cover several days or even weeks, in an attempt to prevent overcrowding in stores. COVID may have moved the starting line of the season altogether however with prime day, typically taking place in July, pushed back to earlier in October. If ever there was a retailer big enough to move the needle by themselves, it was Amazon – and several retailers in the US including Target and Walmart launched their own deals at the same time to compete with the online giant. Customers will be keen to take advantage of these deals this year more than ever, and according to AlixPartners, 49% of consumers plan to start their holiday shopping by Halloween or earlier in the US, and in the UK Maybe*’s survey found that 65% of respondents have already started their Christmas shopping this year.

ECommerce will continue to run the show

It’s a statement everyone in the industry is very familiar with this year, but the defining feature of this holiday season will be a major preference for online shopping and eCommerce. While this trend has been steadily increasing over the years, the coronavirus pandemic has caused a huge spike in eCommerce as many consumers avoid stores and practise social distancing. As a result, Deloitte’s Annual Holiday Retail Forecast predicts eCommerce sales will grow between 25-35% year-on-year, compared to 14.7% in 2019. Similarly, the Maybe* consumer survey found a whopping 58% of customers plan to do their Christmas shopping online this year. This will be a test for many retailers, both pure-play and multichannel models, as the increased demand will test the capacity and strength of both their online channels and their fulfilment capabilities.

How will Brick and Mortar stores fare?

But what of the brick-and-mortar store? It’s no secret that physical retail has taken the brunt of the impact on sales and revenue this year, but will the holiday season offer some respite? Retailers hoping to make the most of the period will need to focus on ensuring safety and customer confidence in their stores, with 55% of consumers saying that COVID-19 safety tops their list of holiday shopping concerns according to a survey by PwC. Even with these measures in place, in-store holiday traffic is expected to drop by up to 25% this year in the US. For the UK, it may be even worse, with only 30% of shoppers heading to their local high street for Christmas, according to Maybe*. Black Friday specifically is where store traffic is likely to fall more than ever, with more than a third of US shoppers planning to avoid stores for Black Friday in the US, and a massive 91% said the same for the UK.

Bigger discounts for Black Friday?

So how are retailers planning to approach this year’s Black Friday to account for this? Alongside the extension of the event and the repositioning online, it seems many retailers are planning on discounting deeper and earlier this year. According to data analytics experts Edited, the most common advertised discount this year is 40-50% for apparel products compared to an average of 20-30% the previous year. For fashion retailers, in particular, this makes sense as the goal is to not only try and drive sales but is, perhaps, more importantly, an opportunity to sell older and slow-moving seasonal stock collected throughout this challenging year.

Store fulfilment will be vital for many

With the continued dominance of eCommerce, non-pure-play retailers are being challenged to keep up with the pace as their online channels have been, at least temporarily, promoted from supporting operations to the heart of the business. Two of the biggest retailers in the US have invested heavily in their ship-from-store capabilities this year,  with Walmart expanded theirs to 2,500 locations, whilst target reported fulfilling 90% of their online orders from store cutting the cost of fulfilment by 30%. Adopting such a strategy not only allows for such operational benefits but it makes the existing eCommerce arm much more durable – which is exactly what they’ll need to be this season.

Click-and-collect / Curbside continue to be popular purchase options 

Similarly, click-and-collect and Curbside services will be more important than ever for many retailers this season. Macy’s CEO called the use of Curbside a ‘big secret weapon’ for the upcoming holiday season. Just how secret it is may be up for some debate, according to customer surveys, 80% of shoppers expect to increase their use of these services over the next six months, and 85% have already significantly increased their use of curbside since the year began. The reason for this is clear as such services tick all the boxes of being convenient, safe and online-first.

‘The season will ultimately cap off what has been several months of steady growth in both the UK and the US.’

‘COVID may have moved the starting line of the season altogether however…’

‘eCommerce sales (are predicted to) grow between 25-35% year-on-year, compared to 14.7% in 2019.’

‘Retailers hoping to make the most of the period will need to focus on ensuring safety and customer confidence in their stores’

‘it seems many retailers are planning on discounting deeper and earlier this year’

‘online channels have been, at least temporarily, promoted from supporting operations to the heart of the business.’

‘80% of shoppers expect to increase their use of these services over the next six months’

Want the latest retail and retail tech insights directly to your inbox?

It's been a year like no other; we recap an eventful year for retail by looking through our best content from the year. From COVID-19 to retail's ongoing digital transformation, and our major updates along the way.
Why online order fulfilment will be a key metric for 2021, and how retailers must adapt and strengthen their fulfilment capabilities to keep up with the higher demand.
A look at DTC retailing and its increasing popularity, plus if direct is the future, what does it mean for the industry going forward?

Omnichannel retailing, offering customers a unified and convenient experience across and between shopping channels, has exploded back into relevance this year. For those in the industry, it might feel like it’s been around for ages – and it has. So long in fact that omnichannel grew into a buzzword that was thrown around relentlessly to the point that the term was declared ‘dead’ by many. The reports of Omnichannel’s death have been greatly exaggerated, however, with the ability to serve customers across multiple channels becoming a life raft for many retailers this year. While the conditions faced this year will be once-in-a-lifetime, many of the effects and trends may be long-term.

What exactly is Omnichannel retailing?

In short, omnichannel is the perfect connection and interplay between a brand’s physical and digital channels. A pie in the sky omnichannel experience is one where the differences or barriers between shopping in-store, online or on a brands app do not exist. You can check a physical stores stock levels on an app, the webshop remembers what you purchased in-store and uses it to recommend you more relevant products and so on. More grounded and familiar examples of this type of retailing are services like click-and-collect (Buy-online-pick-up-in-store) or ship-from-store (buy-online-ship-from-store).

Omnichannel was born from the need for (traditionally) brick-and-mortar brands to compete with online shopping. When retailers tried (and failed) to compete with established eCommerce giants such as Amazon or ASOS by simply launching webshops of their own (Multichannel retailing), they took it one step further. Rather than beat the likes of Amazon at their own game, retailers began doing something Amazon (at the time at least) couldn’t do – leveraging both their physical and digital channels, not in tandem but in unison. For this to work the connection between these channels should be as seamless as possible, so that it stops being the brand’s online experience bleeding into the physical, or vice versa, and it simply becomes the single brand experience.

This move towards omnichannel can come from both directions, as in recent years we have seen pure-play eCommerce brands expand into stores. Amazon for example is building futuristic stores which use customers’ existing amazon accounts instead of checkouts, and are filled with advanced retail technology, blurring the line between physical and digital. Not only is this a unique example of an omnichannel offering but it shows the fact that an omnichannel approach is not just for brick-and-mortar retailers trying to stay competitive, even the ‘disruptor’ e-tailers are repositioning to an omnichannel offering.

Omnichannel Retail

2020 and the Omnichannel revival

The effect of COVID-19 on retail has been well reported so we won’t delve into that here. The key conditions for the relevance of omnichannel are the huge spike in eCommerce and customers reluctance to return to stores. A report from Nosto claims at the height of lockdowns online channels spiked 66%, and a separate report from Klarna found that 71% of shoppers are putting off doing their Christmas shopping in-store this year due to COVID concerns. Whilst brick-and-mortar sales struggling or stopping entirely was bad news for any retailer, brands that have more advanced digital and omnichannel capabilities have weathered the storm far better. They have done this by being flexible and serving the customer wherever is more convenient and comfortable for them. Whilst for many this is online for others it is a mixture of both. This is where the interplay between channels with services like curbside can make a real impact.

Omnichannel Retail in the new normal

The demand for click-and-collect & curbside is higher than ever

As stores have re-opened, many customers want to purchase products from their local stores but are still cautious about fully returning to in-store shopping. Buy-online-pick-up-from-store (BOPIS) offers a convenient and safe solution to these concerns. Customers can check online what stock their local store has available; purchase items online and then collect from the store the same day. This offers a convenient and contact-free alternative to shopping in-store, with Curbside pickup the same concept except customer don’t even have to enter the store. According to customer surveys, 80% of shoppers expect to increase their use of these services over the next six months, and 85% have already significantly increased their use of curbside since the year began. Whilst the initial spike in demand for these services was due to COVID-19, as customers grow accustomed to the convenience, the demand for BOPIS will continue well beyond the pandemic.

Ship-from-store is proving decisive in the online-centric New Normal

On the other side of the omnichannel coin, we’ve seen many retailers absorb the eCommerce bump through the use of ship-from-store. Simply put, ship-from-store involves fulfilling online orders using store stock, effectively leveraging stores as miniature distribution centres. The benefits of this under normal circumstances are already significant, such as cutting down on last-mile fulfilment and offering customers more stock. During the pandemic, however, ship-from-store was a lifesaver for many, allowing brands to not only capitalise on increased online orders but to leverage quiet or even closed stores to prevent unsold inventory piling up. Two of the largest retailers in the USA have been betting heavily on ship-from-store this year, not only as a way to ride the wave of the pandemic but to even compete with the power of Amazon. Walmart expanded their ship-from-store capabilities to 2,500 locations earlier in the year, whilst target reported fulfilling 90% of their online orders from store cutting the cost of fulfilment by 30% and overseeing 100% increase in digital sales YoY.

A temporary blip, or a permanent shift?

The key question is of course, how temporary is this change? As things start to get better around the world, will brands who have bent over backwards to reposition to the ‘new normal’ only find themselves at a loss if things completely revert back to normal? While the drastic increases to eCommerce will fall off a certain extent, in the long-term it will remain higher than pre-pandemic levels. The report from Nosto suggests that this is now levelling off to an average increase of 7%. Not only does this mean the business case for omnichannel services is still stronger than it was at the start of the year, but as customers have relied on services like online and curbside out of necessity, in the future they will continue to demand it of a preference for convenience.

Graph showing how customers expect to shop after COVID

What do retailers need in order to offer a strong omnichannel experience?

So, what are the requirements for retailers attempting to offer their customers these services and experience? Whilst it does depend on how advanced the offering is, the fundamentals are digitisation and integration across all channels.

Expert Chris Walton says there are three foundations to omnichannel retailing:

  1. Cloud commerce
  2. Real-time Data Capture and Applications
  3. Location and Context Analytics

For services like click-and-collect and ship-from-store, the first two points are key. The cloud is needed for the sharing of information, both between the retailers two channels (the store and webshop) and between the retailer and the customer. The data capture is vital for these services to be accurate as to sell products in-store to online customers, retailers need to know exactly what is in stock in their stores to an individual item level. This is why RFID is a key component of omnichannel retailing as it offers the real-time visibility of the products and the high 99% stock accuracy so retailers can offer omnichannel services with confidence.

Want to find out what it takes to implement RFID in retail? Register for our upcoming webinar:

It's been a year like no other; we recap an eventful year for retail by looking through our best content from the year. From COVID-19 to retail's ongoing digital transformation, and our major updates along the way.
Why online order fulfilment will be a key metric for 2021, and how retailers must adapt and strengthen their fulfilment capabilities to keep up with the higher demand.
A look at DTC retailing and its increasing popularity, plus if direct is the future, what does it mean for the industry going forward?

Discover how retail RFID is changing the industry for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.

What is in the eBook?

The retail industry is currently ruled by change. The digital age has seen a huge growth in competition from e-commerce and a rapid shift in consumer preferences. This shift has altered the industry greatly with modern ‘omnichannel’ customers demanding to shop where they want, how they want and when they want. Delivering such an experience is a challenge, one that requires brick-and-mortar retailers to change.

To compete in an increasingly digital environment, brands need the right supporting technology to establish full transparency between their shopping channels and offer consistently excellent service online and in-store. On top of this, the extreme competition within the industry and the subsequent pressure on retailer’s bottom lines means finding ways to reduce or shift costs and eliminate inefficiencies at scale is a priority – again, technology may provide the answers here.

Retailers then are faced with the challenge of providing a better experience to customers while scaling back and consolidating in order to stay financially viable, how do you achieve both at once without overstretching resources and risking multiple technology projects? Obviously, a focus on the specific problems that need solving is key but with the scale of these challenges, you need a transformation that affects the core of the business and isn’t putting lipstick on a pig.

In this regard, Radio Frequency Identification (RFID) is somewhat unique in the retail technology market, due to the sheer versatility of the technology and its ability to solve so many of retail’s most common needs. It is this scope of use cases that have seen RFID become increasingly prominent in the retail environment.   Whilst the basic principle of RFID, tagging inventory with its own unique radio signal, is deceptively simple, its uses and applications are incredibly broad.

In this eBook, we analyse the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Within each of these needs, we identify the challenges often preventing retailers from achieving them, and how applying smart RFID-based solutions can deliver consistently good results.

Improving key metrics in stores

The ebook will teach you how RFID revolutionises daily processes like stocktakes and replenishment in stores. Learn how retailers are using the technology to deliver higher inventory accuracy in-stores (increasing from ~70 to 99%) and to ensure the right product is always available for customers to buy on the shop floor (known as increasing product availability). The eBook will also show you how retailers can achieve these results whilst actually lowering the labour intensity (and costs) of operational store processes like cycle counts and processing inbound shipments.

  • How retailers use RFID for quick and efficient stocktakes and cycle counts
  • Improving stock accuracy in stores
  • How smart solutions are being put to use for item-level replenishment, ensuring products and sizes are always available to be sold.
Results of RFID Retail

Delivering to customers with retail RFID

Find out how retailers use RFID to reliably deliver to their customers by removing common friction points as well as offering new services and shopping experiences. Common pain points eliminated by RFID include: customers being unable to find the right product,  staff not being available to help with requests and service due to lack of time for the customer, or unreliable stock information. On the other end of the spectrum, advanced RFID retailers can wow customers with new shopping experiences both in-store and online.

  • How stores can reduce common customer friction points
  • The relationship between RFID and effective omnichannel services
  • The advanced retail RFID solutions that improve the in-store customer experience like chatbots and smart fitting rooms.
RFID Omnichannel Retail

Optimising supply chains from source to store with automated processes

Learn how advanced RFID retailers have moved upstream to cover their entire supply chains, from stores to warehouses, distribution centres and even factories. The eBook covers how RFID is used to achieve complete supply chain visibility and what additional value this unlocks for retailers due to the advanced item-level data and analytics available.

  • How to achieve supply chain visibility with real-time info on the movement of products inside and across individual stores and distribution stages.
  • How RFID is used to aid logistics at distribution centres, including automated processes like exception handling and order picking.
  • What RFID means for retailer’s data and analytics capabilities, such as advanced supply chain traceability and new KPIs for stores and DC’s.
Retail Supply Chain

Protecting brands and products from theft, counterfeits and the grey market.

Finally, gain insight on how retailers deploy RFID solutions to protect their products, and their entire brand, from illicit activity including theft, counterfeit products and the grey/gray market. The eBook explains how retailers can use the technology to identify individual products and trace them across the supply chain, allowing them to identify where problems are occurring, and stop them at the source.

  • How RFID can be used to monitor and reduce shrinkage, including theft, both in stores and across the entire supply chain.
  • How brands are combatting counterfeit goods by tagging and tracing their products with RFID.
  • What the Grey Market means for retail and how several major brands use RFID traceability to locate and stop the source of grey market products.
The Sources of retail shrinkage

Crisis and change

The relationship between crisis and change is well documented. History is full of innovations coming out of periods of extreme strife. From the collapse of feudalism after the black plague to the invention of the lightbulb during the long depression, even the technology you’re using now, the internet, was a product of the cold war. More recent examples in business (and less historically significant) include both Airbnb and Uber becoming popularised during the 2008 recession. While they both existed before the crisis that popularised them, it was due to a sudden change in customer priorities and needs, where they truly thrived.

Digital technology in a time of physical distancing

Few would argue that COVID-19 is not a global crisis on the same scale as those mentioned above, and great change will be affected by it. COVID is likely to be an engine for major change not only because of its major economic consequences but because of its social implications too.

Video conferencing application, Zoom, has seen an increase in new users of 30x year-over-year, as the platform has become a social tool as well as a business one during lockdown. Speaking of business tools, Microsoft’s team collaboration programme, teams, has had 12 million new users since COVID-19, as businesses get to grips with remote work. Even the physical world of exercise is being supported by digital technology, as applications such as Strava and Peloton have exploded in popularity.

All of these illustrate a major trend of the response to COVID-19 crisis, which has seen digital technology used to bridge the physical distance that is enforced on many worldwide.

Retail’s digital shift – accelerated  

To focus on retail, the story is the same, with there being both an economic and a social impact for brands to navigate. The financial impact of COVID-19 has been huge for retailers, with sales dropping by as much as 70%. This has left almost all brick-and-mortar retailers looking at negative cash flow as a result of closed stores. But even when they reopen, consumer confidence and low foot traffic will still be a concern. Brands will need to find ways to engage with their customers and serve their needs in new ways, as well as to adapt operating models to deal with the major financial strain.

The trend of people relying on and embracing digital channels during this crisis could not be truer in the retail industry. Since becoming the only sales channel available in many categories, eCommerce has soared during the pandemic, with increases of 25-80% depending on the country and industry. Whilst eCommerce is by no means ‘new’, the coronavirus has certainly accelerated its use and numbers are expected to remain higher than before even after the pandemic is over.

Leveraging physical stores in a digital world

This change presents some challenges for brick-and-mortar stores. Even though most brands will have seen an increase in their online sales, stores are still the backbone of retail. But with reduced foot traffic and increased competition from online, stores may need to adapt to stay competitive. Like many trends that have seen sudden surges in popularity during the crisis, the means to do this already exist, but they have suddenly become far more significant.

What are some examples of retail innovations likely to be accelerated by COVID-19?

Retail digital transformation

These developments are just one side of an ongoing digital transformation in retail, that is now more important than ever for retailers to get right. Retailers need the visibility, stock accuracy and item-level data to not only reliably serve customers across channels, but to reduce costs and improve business efficiencies in a challenging economic climate. Some retailers are ahead of the game in this regard and will more than likely absorb the impact of the crisis better than others.

Technologies like RFID, the IoT and advanced analytics modules are driving this digital transformation and creating more agile and resilient operating models. Whilst the current situation in retail is bleak, brands coming out of the other side are likely to be more resilient in the long term, as well as more accessible and seamless for customers across channels.

Want to learn more?

Retail's New Normal

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Apparel Retail’s New Normal: COVID-19 Impact and Future Trends

Now stores are facing new social distancing guidelines, the formula for customer experience has changed. With reduced foot traffic and higher levels of eCommerce, the digital evolution of the retail store is now or never.  Join us on the 16th of June as we dive into the physical and digital transformations behind retail’s ‘new normal’.

It's been a year like no other; we recap an eventful year for retail by looking through our best content from the year. From COVID-19 to retail's ongoing digital transformation, and our major updates along the way.
Why online order fulfilment will be a key metric for 2021, and how retailers must adapt and strengthen their fulfilment capabilities to keep up with the higher demand.
A look at DTC retailing and its increasing popularity, plus if direct is the future, what does it mean for the industry going forward?

🏪 What is in-store fulfilment?  

In-store fulfilment, also known as ship-from-store, is an Omnichannel retail strategy that essentially involves utilising retail stores as miniature distribution centres. This allows eCommerce orders to be fulfilled and shipped to customers from either the primary DC or a nearby store. Having multiple options for fulfilment available means retailers can take some pressure off DC’s and offer customers more stock and faster delivery by utilising nearby stores.

Detego Ship-from-store

📦 Could ship-from-store be a viable strategy during the COVID-19 pandemic?

The use of in-store fulfilment and ‘mini DC’s’ has been steadily growing for years, due to both the continued growth of eCommerce as well as the inherent business benefits listed below. In the current climate of COVID-19, with stores closed and the immediate-future uncertain, leveraging closed stores as DC’s could potentially help alleviate the increased pressure on eCommerce operations and help brands achieve business continuity during this time. The practicality of this will vary between brands and even countries, but its possible a reduced small team of staff could run as an effective warehouse during the coming months.

🚚 What are the advantages of using stores as miniature Distribution Centres?

  • Takes some pressure off DC’s, meaning a brand can handle increasing eCommerce orders without needing to invest in additional DC’s
  • Reduces shipping costs by moving distribution points closer to destination
  • Increases delivery speed as orders are shipped from nearby stores
  • Idle inventory that is sitting in stores can instead be sold through eCommerce – increases margins by preventing seasonal mark-downs.
  • Ship-from-store is an effective and profitable way to prevent inventory stockpiling up at the wrong locations
  • Retailers can offer customers more products i.e. not just inventory available at the DC
  • Alternative ‘mini-DC’s’ offer fulfilment options if the primary DC is temporarily shut down or disrupted.
  • Leverages staff during slow periods for stores or if stores are temporarily closed
  • Offers more products/sizes to customers (see figure below)
Product availability increase from ship from store

☑️ What is required to leverage stores as DC’s?

Whilst the benefits are huge, getting in-store fulfilment right is a fine balance and requires a certain amount of technology and digital integration across the supply chain. Retailers who attempt to offer ship-from-store (or any omnichannel capability) without these prerequisites will struggle. According to the Accenture study ‘Transforming Modern Retail’, Survey respondents that offer ship-from-store claimed that 31 percent of such orders triggered a split shipment, a result of not having the right foundations in place.
So, what do retailers need in order to utilise in-store fulfilment?

  1. Inventory Visibility – First and foremost, for cooperation across and between shopping channels, (i.e. for eCommerce to leverage inventory outside of their primary DC) brands need to have inventory visibility across their supply chain and stores. This view of stock needs to be unified between all channels and be as up to date as possible in order to achieve a ‘single point of truth’ for a brands merchandise.
  2. High Stock AccuracyHaving visibility over all of a brands merchandise is a start, but if this information is not highly accurate, cross-channel initiatives like this one will be fairly ineffective. Retail store inventories can be as low as 70% accurate when it comes to item-level product information. If this is the baseline for ship-from-store, it will result in either split shipments or cancelled orders – resulting in high costs and disappointed customers. For Omnichannel options like this, accuracy needs to be near 99% to confidently offer advanced purchasing options to customers.
  3. Investment in StoresTo facilitate in-store fulfilment a certain amount of investment needs to be made for stores. This may involve slightly altering the layout of a store, or hiring extra staff, depending on the business. More crucially, investment may need to be made in technology to achieve the accurate inventory visibility required to offer ship-from-store. This may include advanced inventory management technology like RFID.
  4. Maintained Store Inventory levelsOnce this is in place and retailers are utilising in-store fulfilment, care needs to be taken to maintain the balance of store inventory between stock available to be used for eCommerce fulfilment and stock that is available for sale in the store. This is a fine balance to maximise sales between both channels. Retailers must ensure ship-from-store orders do not cause out-of-stocks for the brick-and-mortar store that is fulfilling them.
Challenges of offering ship-from-store
Solving Retail's top 10 needs with RFID

eBook

Solving Retail's Top 10 Needs with RFID

Discover how retail RFID is changing the industry for good. This eBook will guide you through the top 10 needs identified by retailers to ensure sustainable success in the modern environment. Explore the common challenges preventing retailers from achieving their goals and learn how applying smart RFID-based solutions delivers consistently good results.

Want the latest retail and retail tech insights directly to your inbox?

It's been a year like no other; we recap an eventful year for retail by looking through our best content from the year. From COVID-19 to retail's ongoing digital transformation, and our major updates along the way.
Why online order fulfilment will be a key metric for 2021, and how retailers must adapt and strengthen their fulfilment capabilities to keep up with the higher demand.
A look at DTC retailing and its increasing popularity, plus if direct is the future, what does it mean for the industry going forward?

Complete Supply chain visibility was once an optional bonus for retailers, but in the modern industry it is becoming more and more of a necessity.

Whilst in the past, limited tracking of shipments in the supply chain was commonplace, in the modern environment with its more complex supply chains, delivery options and increasing customer expectations, retailers need to do more.

This isn’t just us saying so, retailers recognise this too. According to a report by Zebra Technologies, 72% of retailers are working on digitizing their supply chains in order to achieve real-time visibility.

What Is Supply Chain Visibility?  

Having visibility means being able to accurately track products and shipments throughout the supply chain, from the manufacturer, to the distribution centre and finally to the store. Having this visibility prevents shipping errors, improves operational efficiency and allows retailers to leverage products to service their customers better.

See also: a single view of stock for retail

Extent of supply chain visibility

Why Do Retailers Need Visibility?

Managing supply chains effectively is always a priority for retailers. But as these supply chains get bigger the challenge becomes more daunting. Visibility is needed to align such large operations, and this is before you add new pressures like omnichannel, traceability and online orders.

Additionally, supply chain visibility is arguably even more important in ecommerce than for pure-play brick and mortar retailers. Not only do you need to know exactly what stock the fulfilment centre has, but what stock it is due to receive and when. And since pure-play brick and mortar retailers are now few and far between , this now means that most retailers’ supply chains need to be more advanced and transparent than previously required.

This is before mentioning the divisive omnichannel word, which often requires even greater transparency and synergy between stores and distribution centres and includes multiple delivery options.

There are also more classic supply chain challenges that can be helped by achieving visibility. General inefficiencies and inaccuracies can be reduced by adding more checkpoints throughout the supply chain – particularly when these are done at an item level, and not shipment or carton level.

Adding this visibility also makes better communication between different stages of the chain possible, which leads to smoother operations. Having visibility at an item-level also makes traceability of items through the supply chain possible. This can make a massive difference in combatting supply chain shrinkage, and in some cases the grey market.

3 reasons supply chin visibility is important

The ‘New’ Challenges:

 

Multi/omni-channel businesses – It seems like an age ago, but traditional retail supply chains went in one direction and to one place – stores. Now almost all retailers also run their businesses online meaning their they operate on multiple sales channels, therefore, their supply chains service far more destinations than before.

Multiple delivery options – A relatively recent challenge created by the growth of online and the already mentioned omnichannel purchasing options. Retailers want to offer their customers as much stock and as many purchasing options as possible, but without the technology to support it, this can cause problems. In an Accenture survey, respondents claimed that 31 percent of their Ship from Store orders triggered a split shipment.

Customer expectations – Customer expectations has shifted. In a 2019 report, it was found that Half of shoppers reported abandoning a purchase due to a lack of cross-channel buying options. This is a major impact on sales, and many retailers are starting to adapt to the change in expectations.

The Old Challenges:

 

Supply chain inefficiency – Supply chain inefficiencies and miscommunication through “Chinese Whispers” are costing UK businesses over £1.5bn in lost productivity according to analysis of industry data from Zencargo.

Supply chain shrinkage – According to the National Security Survey, businesses in the United States lose $45.2 billion through inventory shrinkage a year. Whilst retail stores make up the majority of this, supply chains still experience large amounts of inventory shrink, particularly when they have no visibility of products.

What are the benefits of having supply chain visibility?

  • Better customer service

  • Improved inventory control

  • Shorter cycle times

  • Smoother operational processes between stores and DC’s

  • Better data for more intelligent business decisions

  • Reduce out of stocks

  • Track and trace products

  • Offer effective omnichannel services and delivery options

Detego Retail Track and Trace

How Do You Achieve Supply Chain Visibility?

  • Implement a system that works at an item-level (not whole cartons)

  • Accurately track products at as many points as possible during shipping

  • Inbound and outbound counts at every stage of shipping

  • Implement effective exception handling

  • Use a cloud-based system to integrate all stages of the supply chain and achieve as close to a real-time view of merchandise movement as possible

  • Send advanced shipping notices (ASN’s) so warehouses and stores now exactly what they’ll receive

  • Use this visibility to enable traceability of each item throughout its journey

Retail Supply chain tracking

The Detego Platform allows retailers to gain complete visibility over their operations

If you’re looking for a solution or partner to help achieve better supply chain visibility, consider our platform!

Using RFID item level-tagging, the cloud-based Detego platform gives each individual item a unique digital identity. Items are then tracked from factory to shop floor using radio frequency identification (RFID) methods. RFID makes this possible as inbound, outbound and even exception handling can then be done through RFID reads – which are fast, accurate and can be done without opening cartons.

Since RFID works on the individual item-level, the result of this is complete visibility of the supply chain. The platform utilises the IoT to create a complete overview of every single product in the supply chain, as its cloud hosted this can be close to real-time and is the ‘single point of truth’ for the entire business.

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A single point of truth in retail means having a single view of stock across the business. It means stores and distribution centres aren’t islands of merchandise that are clunkily attempting to share their version of stock information with one another as best as possible. Instead, at the foundation of the business is a unified view of every single product. Because this view of stock covers the entire network, items can move between stores and DC’s and remain in line-of -sight the entire time. This has huge benefits for individual operations and the business as a whole.

A single point of truth for retail inventory must be:

Single stock view

What is gained from having a single stock view?

Delivering a single stock view with RFID

So how do you achieve this reliable and complete view of stock? A single view of inventory starts with the single item. By giving each item an RFID tag, you’re essentially giving it a unique digital identity. This means, using regular RFID reads and sensors, you can easily track the item as it moves along the supply chain. Once it has arrived in a store, the stock becomes far easier to count, monitor and control. Because all this information is stored centrally in a single place, the individual item can be seen by the online store (and its customers) and even neighbouring stores and DC’s. This transparency boosts efficiency and makes cooperation between different arms of the retail operation far easier to manage.

Single Stock View Roadmap

The Detego platform is the single point of truth for retail inventory

The Detego platform puts all this together and delivers a single stock view that can be counted on. Using RFID we effectively digitise every single product in the supply chain and the store network. The information can then be fed into existing systems, such as ERP and OMS. This delivers all the benefits mentioned above, and our in store application guides store staff to effectively capitalise on this complete view of store inventory.

Single point of truth across supply chain

‘Detego is our “Single point of truth” in terms of in-store inventory. As a result, we are able to improve our omnichannel services such as click & collect, returns from e-commerce in the store or directly deliver to consumers from the store in a very efficient way. These are exactly the services our consumers expect today.’

Tobias Steinhoff, Senior Director Business Solutions Sales Strategy and Excellence, adidas

Did we spark your interest?

It's been a year like no other; we recap an eventful year for retail by looking through our best content from the year. From COVID-19 to retail's ongoing digital transformation, and our major updates along the way.
Why online order fulfilment will be a key metric for 2021, and how retailers must adapt and strengthen their fulfilment capabilities to keep up with the higher demand.
A look at DTC retailing and its increasing popularity, plus if direct is the future, what does it mean for the industry going forward?

The retail environment has never been more demanding than it is today, thanks to fierce competition, the growth of e-commerce, and consumers’ high expectations for seamless shopping experiences. It’s a situation made even more difficult by a lack of inventory visibility, the complexity of supply chains and the sheer variety of products brands are faced with.

While retailers have access to a growing number of solutions to these issues, RFID (Radio Frequency Identification) is the only one that’s proven to consistently meet retailers’ needs for leaner processes, accurate inventory and real-time data analytics.

This webinar covers:

• The five most important needs identified by retailers and their effect on business
• How RFID-based systems and processes can be applied to solve each need
• What financial and operational benefits can be gained by doing so
• How retailers can further unlock the power of RFID to offer a truly seamless and connected shopping experience

Nowadays, fashion retail is not restricted to one single sales channel only. Fashion retailers rather provide their customers with a whole variety of different channels. Hereby, the customers’ expectations are clear:  they demand a smooth shopping experience across all channels. Reliable stock information builds the basis for any satisfied omni-channel customer. A successful “one-face-to-the-customer” strategy can only be achieved with a real-time view on the overall stock; regardless of whether it is being checked in the store, in the franchise store, at the wholesaler or in the online shop. The resulting 100% article availability across all channels guarantees a satisfied customer who may buy again.

Which solution fits everyone?

The one-fits-all approach represents a scalable sizing concept within the fashion industry. Transferred to the IT landscape, the challenge is to integrate all channels in a way that the customer perceives them as one single entity.

Integrated system landscape: Real-time stock view for retailers as well as customers.

Why integrate all channels?

  • Brand stores
  • Stores of franchise partners
  • Concession stores
  • Online shop

Customers do not distinguish where and from whom they buy: in the brand store or its online shop, in the department store or in a franchise store. Customers are looking for a specific article and expect a certain price and quick delivery.

System landscape requirements:

  • Real-time view on item-level
  • Constant updating of involved systems with regards to stock movements
  • Central stock view (for stores, franchise partners, wholesalers) on item-level (real-time) as a single-point-of-truth
  • Access to stock information for all sales partners in real-time
  • Real-time information on item-level also for customers
  • Real-time analysis of article movements, aging structure, replenishment performance to optimise article availability

Analysis for everyone

Of course, an evaluation of individual sales channels can be useful to determine its success. However, only an analysis of all the channels, taking into account the entire branch network and all sales partners and online sales, is decisive for the assessment of the collection-, product range- and, above all, the omni-channel success.

Detego InReports

Consumer Engagement for everyone

Successful labels roll out their new collections in a multi-channel strategy across all sales outlets.  In addition, social media as well as viral campaigns inter-relate with one another. The aim is to offer various touchpoints for customers to interact with brand and articles. A stronger relationship with the brand and more time spent – in the store and in the online shop – lead to more sales.

Detego offers fashion retailers a reliable platform for inventory management, analytics and customer engagement across all channels.

Platform advantages:

  • Scalable: Just as your business requires. Start small. The platform expands itself.
  • Modular:  In-store management, analytics & reports, consumer engagement – choose what is necessary.
  • Flexible: SaaS for switching on and off specific services as needed.
  • Manageable: All services on one single platform. Accessible for everyone.
  • Economical: Investment protection for the seamless integration of existing systems.

Did we spark your interest?

Customers drive retail strategies with their various and versatile demands. They want the ability to shop anytime, anywhere while expecting a consistent brand experience in the store, on the web and using mobile apps. Customers anticipate immediate access on an article’s availability across all channels – and fast delivery! Failure means losing a customer to a competitor. They’re only a click away. Meeting these expectations requires a digital transformation of the stores and efficient omni-channel retailing. But how to implement these strategies successfully? With an intelligent business base.