5 retail supply chain insights from NRF 2021
Did you miss “Chapter One” of the National Retail Federation’s (NRF’s) Big Show event in January? Wondering what valuable supply chain insights you might’ve missed from IBM retail clients and experts? We’ve got you covered with the top five supply chain insights from this year’s virtual event.
1. Supply chain resilience starts with end-to-end visibility
Moving into 2021, supply chain resilience is a top priority for most retailers. To optimize operations in good times and maintain business continuity during disruption, supply chain leaders need real-time, actionable insights. But supplier complexity, siloed systems, batch ERP data, and error-prone, manual processes can make it difficult to even see current and complete data – let alone analyze it in time to make better supply chain decisions.
Golden State Foods (GSF) is tackling visibility and transparency challenges using a combination of AI, IoT and blockchain to preserve the quality of products the company delivers to quick-serve restaurants and stores worldwide. In our first Big Ideas speaking session, Bob Wolpert, Chief Innovation & Strategy Officer for GSF, shared how they’re gaining visibility into data from IoT sensors in refrigeration trucks and applying AI to reveal trends and patterns. This allows them to monitor compliance with temperature ranges, address points of weakness, and ensure higher product quality with less waste. Blockchain drives additional value by enabling GSF to track product movement in real-time with trust and transparency, so they can adjust replenishment cycles, shift goods to different locations, and alter production based on demand patterns. “If you have the data and you can see it to act quickly, that’s a game changer for your supply chain,” said Bob.
2. Omnichannel fulfillment keeps customer needs front and center
Retailers never could have imagined the turbulence of last year when their doors were forced to close, at least temporarily. Flexible fulfillment options like curbside pickup were the key to meeting customer needs for essential retailers, like grocers, and keeping inventory moving for others. Even in the face of added complexity, some retailers were able to pivot more quickly and easily because they had the right order management system (OMS) in place.
For example, Sally Beauty serves both consumers and businesses and experienced different demand shifts depending on the customer base. Consumers were moving to DIY hair color and nail treatments, while salons were closing. In another Big Ideas session, Sally Beauty explained how they regrouped and reopened by implementing new omnichannel capabilities in three short weeks. With IBM’s SaaS-based OMS, they were able to scale quickly and manage peak demand, which was essential considering they re-emerged into an environment that was the equivalent of Black Friday times 10. They expanded ship-from-store and same-day delivery capabilities, and soon added buy online, pickup in store (BOPIS). “All of this is with the intent to remove customer friction and thinking customer first. If it doesn’t impact the customer, we’re not going to spend time on it,” said Joe Condomina, CTO, Sally Beauty.
3. When you empower the customer, you empower the industry
Consumers want to make more informed decisions about the food they buy and the brands they support. Research shows 65% of consumers want to know more about how food is produced. Providing this information builds trust and competitive advantage. But what does this mean for supply chain leaders?
The National Chamber of Aquaculture of Ecuador, through its Sustainable Shrimp Partnership (SSP), has realized the answer is education enabled through blockchain. Many consumers don’t know the origin of the shrimp they eat and the practices behind the product. The SSP leads the way in sustainable practices that have personal health and environmental benefits, but they needed to be able to capture and share that information to empower customers and the shrimp industry. In our final Big Ideas session, Jose Antonio Camposano, Executive President, National Chamber of Aquaculture of Ecuador, SSP, explained how by shifting the industry from manual processes and excel spreadsheets to a blockchain-based platform, all parties can track and trace shrimp from the hatchery, to the farm, to processing facilities and export operations. “For the first time, the consumer will be the one with the power to go back to the company and ask them directly for the information they are interested in,” said Jose. Consumers – chefs, nutritionists and home cooks – can scan a QR code to get information like antibiotic usage and farming impact on ecosystems to help make better decisions. And the industry gains long term sustainability, differentiation and growth opportunities.
4. Building trust and transparency is a team sport
Supply chains are no longer linear, but more dynamic in many industries. They are networks of networks with parties sometimes changing roles to play different positions on the team. During the pandemic, some channel distributors holding a lot of inventory became suppliers, and retail stores forced to close their doors became distribution centers. With shifting relationships and rising customer expectations, trust has come to the forefront – especially with trust in vaccines top of mind right now – but trust in food and fashion has been a top concern for years.
In an interactive session co-led by Jason Kelley, General Manager, IBM Blockchain Services, and Karim Giscombe, president and founder, Plant AG, participants discussed how trust is established with data. In non-linear supply chains, that data must be shared in a distributed model. Adding blockchain technology to a multi-enterprise business network allows for this, providing permissioned access to trusted data across the supply chain. Karim explained how Plant AG is addressing the massive disconnect between food producers and consumers. Working with IBM, Plant AG is using blockchain to create data connectivity and a single source of truth along the food supply chain, from point of origin to point of consumption and all parties in between.
5. Weather insights help mitigate the impact of climate change on the supply chain
Finally, in an interactive session with John Bosse, Offering Manager for AI Applications, IBM, participants discussed how to identify and manage the effect of climate challenges within supply chains and retail operations. Today, climate change is disrupting the operating model of all businesses in myriad ways, and brands must understand how to turn negatives into positives. Consumers are willing to align their shopping habits to support their values of sustainability and healthy lifestyles, making it more important than ever for retailers to consider their environmental impact. In addition to doing right by the planet, companies that plan with climate change in mind can secure an 18% higher return on investment than companies that do not. With weather insights, companies are increasing food production on existing farmland to avoid deforestation and responsibly feed a growing population, enabling sustainable oil palm production, and increasing crop yields and quality while reducing water use. Additionally, retailers are reducing greenhouse gas emissions around their supply chain logistics and better predicting the impact weather has on consumer demands.