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Category Archives: Manufacturing

Top Supply Chain Challenges for Manufacturing Companies

The variety of products available through a growing number of distribution channels is truly amazing. Competition between brick and mortar and e-commerce retail channels, often within the same company, has led to a proliferation of products and services.

In fact, on a recent trip to a Nike store I explored the NIKEiD program they launched a few years ago that allows customers to customize their footwear. Once configured, your customized shoes are produced and delivered to your house in a matter of a couple of weeks.) I can’t wait to receive my Michigan State themed shoes – GO GREEN, GO WHITE.)

Delivery of ‘make to stock’ products to a home or business is now available within hours of making a purchase. A growing number of connected, smart devices that have the capability to anticipate the need for a product are available for purchase.

Consider the smart refrigerator that orders a gallon of milk based on the quantity of milk in the refrigerator and its average consumption. Consider the smart printer that orders replacement ink cartridges based on amount of ink remaining and an average use rate.

Furthermore, 3-D printers are becoming more common allowing companies and consumers to make their own products on-site. What’s next? Products beamed right into your house. Beam me up Scotty!!

Back to reality, today’s manufacturers face a long list of difficult supply chain challenges including increasing demand variability, inventory proliferation, manufacturing capacity constraints, increasing risks both nature and human based, more environmental compliance regulations, intense global competition, increasing customer expectations and a shortage of talent.

To survive in today’s highly competitive global environment, manufacturers need to piece together the many parts of the supply chain puzzle to lay the foundation for more mature capabilities in the future.

An estimated, 75% of available supply chain data originates from outside the ERP system. Complexity opens risks of miscommunication and disruptions, often from incorrect or incomplete data.

Clean and consistent data is required to harness the power of investments in analytics, digitization, optimization, machine learning, big data and other advanced supply chain capabilities. A supply chain Master Data Management (MDM) solution provides consistent, harmonized, standardized and actively managed data from across the extended supply chain.

Accurate demand forecasts lay the foundation for an effective supply chain. With greater forecast accuracy comes greater predictability ensuring downstream supply chain processes run smoother at less cost.

To be successful at demand planning requires an in-depth knowledge of your business, experience forecasting your products, and an advanced demand planning solution. Demand planning solutions use science to automatically apply a variety of forecasting methods in an unbiased way to create forecasts for all stages of a product’s life cycle.

Manufacturing facilities are pressed by market demand to provide greater product variety and shorter delivery times. Shifting to production lines that are more flexible and closer to customer demand helps produce a greater variety of products with shorter lead times with smaller batch sizes and more frequent change overs.

However, multi-plant sourcing and scheduling increases complexity and the need for enabling technology to develop an integrated plan for both aggregated levels of production and site level production to meet customer orders.

Eliminating excess and obsolete inventory is a priority for many manufacturers. Effective inventory reductions are best achieved by synchronizing demand forecasts, inventory quantities, and supply capacity throughout the extended enterprise. Multi-echelon inventory optimization replaces rules of thumb with science to optimize where and how much inventory should be held across the extended supply chain.

Many manufacturers find it extremely challenging to align supply capacity to variable demand, while meeting corporate objectives. Marketshare can be won or lost based on how well a company predicts and reacts to demand shifts. A well run Integrated Business Planning (IBP) process supported by an advanced IBP solution can mean the difference between success and failure. Companies that take a spreadsheet driven approach spend too much time manipulating data and not enough on value-adding activities.

Manufacturing supply chains have many moving parts, each with their own challenges and potentially conflicting objectives. Only a scalable, interoperable supply chain planning and optimization platform can ensure a company’s supply chain performance is optimized.

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Solving the Supply Chain Planning Puzzle
Manufacturers today face a long list of tough supply chain challenges. Supply chain teams that rely on a jumble of spreadsheets, enterprise resource planning (ERP) systems, and antiquated supply chain applications risk failure. Keeping data in many different places and systems limits visibility and creates misaligned plans. Download Now!

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Five Steps to Transform Your Consumer Goods Supply Chain

 

Today’s modern supply chains are multi-enterprise, starting with consumers, retailers, distributors; and flowing through an extended network of suppliers, contract manufacturers, and other third parties.

Successfully managing such supply chains requires visibility, planning, and execution across all trading partners.

Here are 5 steps to transform your extended supply chain into a competitive advantage:

1. Look beyond the enterprise and adopt analytics that uses real-time data

While traditional planning applications are restricted to mostly historical data from within the enterprise, current data from the extended supply chain – from retailers or distributors – contains critical information. Use it.

2. Automated algorithms are here to help

Automated algorithms enable the next step in supply chain performance through the systematic analysis of large amounts of data. It, therefore, frees professionals from mundane, low-value activities to focus on more strategic areas such as planning promotions or inventory policy decisions. Leverage technology to do more.

3. Connect logistics to S&OP

Finished goods are planned weeks or even months in advance yet shippers are the last to know, often finding out as orders cross their desks.

As a result, logistics is stuck in reactive mode, scrambling to secure capacity each day. New transportation forecasting algorithms can now predict logistics requirements that are synchronized with S&OP to ensure that everyone executes against the same plan.

4. Create healthy inventory across the entire supply chain

Managing inventory to support the business’ growth requires the simultaneous optimization of all echelons of the extended supply chain.

Removing unproductive inventory across the value chain frees millions in cash to invest in other parts of the business and lowers operating expenses by having the right product in the right place the first time.

5. Better serve customers by accurately sensing demand and connecting it to a timely supply response

Linking real-time demand with a timely supply response allows companies to commit with confidence and profitably capture growth opportunities in today’s volatile markets.

If your company is not already working on leveraging its extended supply chain, the time is now.

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End-to-End Supply Chain Connectivity and Integration
Large, high-profile organizations are leveraging E2open’s unified, end-to-end platform to bring together planning and execution, supported by the application breadth to meet functional requirements and the depth to solve new challenges. Download Now!

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Recapturing Reverse Logistics Expenses Through Blockchain

Reverse Logistics Costs

The costs of reverse logistics amount to more than $750 billion per year, and the demand for reverse logistics has risen in recent years with the rise of e-commerce.

According to Stacy Rudolph of Business to Community, up to 30% of all products ordered online become returns, placing an insurmountable burden on reverse logistics.

Using a combined blockchain and reverse logistics strategy can help alleviate these costs, and supply chain executives need to understand a few things about it.

Reverse Logistics Carry High Risk in Supply Chain Management

Risk within reverse logistics is higher than that and forward logistics. Manufacturers and shippers have a duty to ensure sustainability, reports Supply Chain Dive, and an effective sustainability program must consider what happens to products after their lifespan.

In other words, the final resting place for products is the burden of manufacturers, and some products, such as smartphones and electronics, can pose a risk of harm to the environment and the personal information of device users.

Blockchain Offers Significant Benefits to Returns Management

Consumers are turning toward eco-conscious decisions in purchases, and blockchain technology could be the solution.

They expect manufacturers to adhere to the guidelines within the International Organization for Standardization (ISO), governing proper disposal of goods, including reclamation of raw materials and removal of personal information from electronic devices.

ISO standards are essential to effective returns management. Since products may be used before returned, the burden of ensuring the privacy of consumer data and integrity of the product falls to the manufacturer or shipper. Other products, such as those used for hygiene or personal uses, could increase the risk of cross-contamination throughout the supply chain. This is why blockchain in reverse logistics go well together.

Download the White Paper: An Introduction to Blockchain in Supply Chain Management

Blockchain technology has major implications for monitoring products at the end of their lifespan through devices connected to the Internet of things, and in the spare parts supply chain, which is part of reverse logistics, blockchain technology can be used to reduce over- and under-ordering, ensure compatibility of spare parts with items being repaired.

This is not limited to small items, and it includes major sectors of the economy, like the automotive industry. As explained by a Technavio Report, asserts Business Wire, blockchain technology can enhance the flow from information in reverse logistics, helping manufacturers understand the full cycle of their products, even after disposal. The technology also has implications for handling product recalls, especially in the food and drug sector.

Best Practices for Using Combined Blockchain and Reverse Logistics Strategies

The road to better reverse logistics is not always clear, and supply chain leaders need to understand a few best practices for implementing combined blockchain and reverse logistics strategies. These practices include:

  • Identify limitations of existing systems and visibility problems within reverse logistics.
  • Share information about potential savings to shareholders, as well as the impact on public image, resulting from better logistics within returns management, increasing customer service levels.
  • Integrate supply chain systems into a single platform, providing a combined approach to management of product lifecycles from procurement through reclamation, recycling and disposal.
  • Share plans to implement blockchain-based solutions within the supply chain and with other supply chain partners, such as suppliers or vendors.
  • Outsource nonessential tasks to third-party logistics providers, freeing capital for investment into blockchain technology. In fact, the use of 3PLs rose 5% last year, reports SmartBrief, so the natural progression will be for 3PLs to begin using blockchain in their platforms as well.
  • Encourage a culture of acceptance of blockchain by moving all processes into the ledger technology.
  • Develop smart contracts that ensure all affected parties understand their obligations while cutting out the middleman, explains Irish Tech News. Blockchain can ease concerns over returns processes, critical for returns in stores when purchased online, as defined by the contract.
  • Implement new payment processing systems, such as WireCard, which are using and developing blockchain technology to map payments thoroughly, reports com.
  • Make use of blockchain technology to track returns, as well as initial orders, will increase consumer trust, even when consumers are business to business purchasers.
  • Use cost savings achieved through blockchain in reverse logistics to offer free return shipping, increasing conversion of site visitors. In fact, 79% of customers want free return shipping, and 92% will make repeat purchases if returns are easy.
  • Make the use of blockchain technology in returns management visible to consumers. Since 67% of shoppers check returns policies before making a purchase, this will aid in selling more product and creating hassle-free returns policies.

Act Now to Recapture Reverse Logistics Expenses Through Blockchain

Shippers and supply chain leaders have a big opportunity to recapture lost costs through more effective reverse logistics and comprehensive, easy returns management. It’s not just about saving money in returns; it’s about positive customer experiences and interactions.

Combining blockchain and reverse logistics will generate a hassle-free way of connecting existing supply chains to reverse logistics and keeping costs down for consumers.

Related Article: How Will Blockchain Ledger Technology Impact Shippers?

How Will Blockchain Ledger Technology Impact Shippers?

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US GDP Q2 Growth Highest in Almost 4 Years

July 27, 2018 · By Joana Taborda

Personal consumption expenditure (PCE) contributed 2.69 percentage points to growth (0.36 percentage points in the first quarter) and rose 4 percent (0.5 percent in the first quarter).

Spending of durable goods rebounded (9.3 percent compared to -2 percent) and rose faster for nondurable goods (4.2 percent compared to 0.1 percent) and services (3.1 percent compared to 1 percent).

Fixed investment added 0.94 percentage points to growth (1.34 percentage points in the first quarter) and increased 5.4 percent (8 percent in the first quarter).

Investment rose less for equipment (3.9 percent compared to 8.5 percent), intellectual property products (8.2 percent compared to 14.1 percent) and structures (13.3 percent compared to 13.9 percent) and continued to fall for residential (-1.1 percent compared to a -3.4 percent).

The contribution from private inventories was negative (-1 percent), compared to +0.27 in the first quarter.

Meanwhile, exports jumped 9.3 percent (3.6 percent in the previous quarter) and imports rose at a much slower pace (0.5 percent compared to 3 percent). As a result, the impact from trade was 1.06 percent, much better than -0.02 percent in the first quarter and the highest contribution since the last three months of 2013.

Government spending and investment added 0.37 percentage points to growth, slightly higher than 0.27 percentage points in the first quarter. It increased 2.1 percent, above 1.5 percent in the previous quarter.

GDP growth figures for the previous years were revised due to comprehensive updates of the National Income and Product Accounts (NIPAs), which are carried out about every five years.

The updates incorporate newly available and more comprehensive source data, as well as improved estimation methodologies. The GDP growth for 2017 was revised slightly lower to 2.2 percent from 2.3 percent.

Related: Tariffs Present Different Supply Chain Challenges for Shippers

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Source: https://tradingeconomics.com/united-states/gdp-growth

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C.H. Robinson CEO John Wiehoff Talks Transportation Trends

April 27, 2018 · By 24/7 Staff ·
John Wiehoff, CEO of C.H. Robinson, is one of the keynote speakers for the Connections 2018 supply chain conference, which will take place June 25-27 at the Greenbrier Resort in West Virginia.

He recently spoke with SMC³, which has served as one of the 3PL’s long-time partners, about emerging technologies in the industry, unique supply chain opportunities, and how C.H. Robinson uses technology to optimize its business.

What are some of the major trends you’re currently seeing in the LTL marketplace?
Demand for LTL is higher than we’ve seen it in nearly 10 years. This shift is an especially significant change when paired with supply changes. Both manufacturing and e-commerce are extremely strong right now, and both have close ties to LTL.

Online orders are driving smaller shipments to the LTL space, not just in the final-mile area. Smaller orders are becoming more common for the middle mile – from one distribution center to another.

LTL capacity is tight because carriers have not added a significant amount of equipment to their fleets in recent years. But even if there was an influx of tractors, there aren’t enough drivers available.

Historically, the driver shortages that affected the truckload market remained mostly out of the LTL space, but even that is changing. Growth in other sectors that have a shared labor force with truck drivers means more LTL drivers are leaving for options that are more lucrative.

As LTL carriers look to be more productive, we are seeing them place a large emphasis on optimizing their networks. With the data, analytics, and tools like dimensionalizers available to them, LTL carriers are paying more attention to accepting the right freight in the right lanes at the right time. More isn’t absolutely better anymore.

How has the ELD mandate impacted the domestic transportation market?
Drivers are reaching their hours of service in shorter timeframes, especially given the tight capacity. Organized and efficient loading/unloading times will become even more important. Reducing driver wait time at either the origin or destination can have a significant impact in a driver’s hours of service.

Both carriers and shippers may rely more heavily on 3PLs. A 3PL can help identify and solve capacity shortages, handle potential rate increases and address other issues from the mandate.

John Wiehoff, CEO of C.H. Robinson

How does C.H. Robinson use new technology to optimize its business, and are there any emerging technologies that will be game changers for the supply chain industry?
We are using technology to reinvent what it means to be a leading 3PL for this industry, our customers, and carriers.

Our technology offering is at the center of what we do and is embedded in our services and solutions every day.

You can see the importance technology has within C.H. Robinson by the number of IT staff and investments we have made and continue to make – we’ve added more than 800 IT staff and invested over $1B in the last decade.

As our business grows – now to more than 120,000 customers who worked with us on more than 19 million global shipments last year – we increasingly rely on technology.

Technology backed by data is critical to the success of our business. As one of the largest 3PLs, we have arguably more first-party data than anyone else in the industry. But, that data doesn’t matter if we don’t use it to our and our customers’ (shippers and carriers) advantage.

That’s why we are continuing to invest in and build tools that leverage the amount of data we have available to us.

The Connections 2018 supply chain conference is perfectly positioned at the midpoint of the year, giving speakers a chance, to sum up, the first half of 2018. What themes have defined the first half of the year, and what will define the transportation market during the second half?
For the first half of the year, we saw efficiencies in utilizing capacity, as truckload utilization climbed to more than 95 percent, according to FTR Transportation Intelligence. At the same time, new trucks increasingly entered the market to replace retiring trucks.

For the second half, these factors will combine for a focus on hyper-efficiency and the most effective use of capacity. We’ll be able to see if the strong truck sales of the first half of the year will add capacity or primarily serve as replacement capacity. We’ll also be able to put our finger on the real effects of ELD.

How can shippers and 3PLs better position themselves to take advantage of supply chain opportunities in the marketplace?
As supply chains grow in both size and complexity, transportation management technology will be an important way for 3PLs to help shippers gain a competitive advantage and exceed their customers’ expectations. That’s why we are invested in delivering and implementing flexible, efficient and integrated technology solutions that connect all aspects of the supply chain.

Read: Transportation Management Systems Market 2018

It is not so much what changes are coming to the industry; it’s more important to focus on what the innovative supply chain of the future will look like and recognize that it will take people, processes, and technology to bring positive change.

Digitalization of supply chains is our opportunity to continue bringing technology to our customers and their supply chains that make them smarter and more efficient. The technology we are able to bring today and into the future has to go beyond freight matching to encompass the complexities of today’s and tomorrow’s supply chains.

An algorithm can do amazing things, but when a truck gets delayed or a delivery window changes, people are still able to provide the most effective solution.

To hear more from John Wiehoff and other industry experts, sign up today for the three-day supply chain conference Connections 2018 to learn about emerging trends, current challenges and new innovations in the supply chain.

Register here by April 30 to take advantage of early-bird pricing.

Raise Your Supply Chain IQ
Connections 2018 | June 25 – 27 | The Greenbrier, WV

Why Attend Connections 2018

To REGISTER for SMC³’s Connections 2018, visit www.smc3connections.com

Related Article: SMC³ Announces Connections 2018 Speaker Lineup

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Game Over as Bankrupt Toys ‘R’ Us Files for Liquidation and Begins US & UK Store Closures

Toys R Us, the toy superstore chain that became a dream factory for kids nationwide, said in a U.S Bankruptcy Court filing early Thursday that it must liquidate, a move that will likely lead to the closure of all its stores and sale of remaining merchandise.

As reported by Reuters, the closure is a blow to generations of consumers and hundreds of toy makers that sold their products at the chain’s U.S. stores, including Barbie-maker Mattel Inc, board game company Hasbro Inc and other vendors like Lego.

“This is a profoundly sad day for us as well as the millions of kids and families who we have served for the past 70 years,” Chief Executive Officer Dave Brandon said.

With shoppers flocking to Amazon.com Inc and children choosing electronic gadgets over toys, Toys ‘R’ Us has struggled to boost sales and service debt following a $6.6 billion leveraged buyout by private equity firms in 2005.

Toys ‘R’ Us said on Thursday it is seeking approval to liquidate inventory in its 735 U.S. stores, which debtors anticipate will close by the end of this year.

It is in talks to sell 200 of those stores as part of a deal to sell its 80-odd stores in Canada.

For its operations in Asia and Central Europe, including Germany, Austria, and Switzerland, the company will pursue a reorganization and sale process. The already announced administration of its UK business will continue, the company said.

The wind-down follows a bruising holiday season when the company failed to stay competitive and sales came in well below projections. The quarter accounts for 40 percent of its annual net sales.

Toys ‘R’ Us’ creditors said in a court filing that Target Corp, Walmart Inc and Amazon pricing toys at low-margins and a greater-than-expected decline in toy and gift card sales following its bankruptcy filing in September led to the weak performance in the quarter.

“Even during recent store closeouts, Toys R Us failed to create any sense of excitement,” said Neil Saunders, managing director of retail research firm GlobalData Retail. “Its so-called heavy discounts remained well above the standard prices of many rivals.”

Toys R Us Store Closures

Wayne, New Jersey-based Toys ‘R’ Us was already in the process of closing one-fifth of its stores as part of an attempt to emerge from one of the largest ever bankruptcies by a specialty retailer.

In September, when the company operated more than 1,600 stores globally, with roughly 800 stores outside the United States, it got court permission to borrow more than $2 billion to start paying suppliers.

But efforts to keep the business going collapsed after lenders decided that in the absence of a clear reorganization plan, they could recover more in a liquidation by closing stores and raising money from merchandise sales.

The company’s troubles mirror those of other mall-based retailers in the United States that have shut stores and fired employees in a bid to stay relevant.

More than 8,000 U.S. retail stores closed in 2017, roughly double the average annual store closures in the previous decade, according to data from the International Council of Shopping Centers.

The disappearance of Toys ‘R’ Us leaves a void for hundreds of toy makers that relied on the chain as a top customer alongside Walmart and Target.

7 Retail Management Lessons You Can Learn from Toys ‘R’ Us

While the final reason for the closures may be the debt – the truth of the matter is that Toys ‘R’ Us landed in this predicament for many reasons. Their poor performance, which led to their not being able to afford their debt, can be attributed to many things.

For small and medium-sized businesses, there are several lessons that can be gleaned from the Toys ‘R’ Us shutdowns.

Here are a few other ways, detailed by Kris Hiiemaa of Erply, why Toys R Us contributed to its current condition:

1. They closed down the main store at Times Square

In 2015, the company closed its flagship location in Times Square, without having a new location in mind for the new flagship. This location was more than just another location for the chain – it was a tourist attraction. The giant Empire State Building built of LEGO pieces in the store, as well as the indoor ferris wheel featuring the company’s logo, were frequently photographed by tourists and visitors from all over the world. The reason for shutting down this location was, reportedly, inability to afford the rent at the location any longer.

The problem here is two-fold. First, Toys ‘R’ Us closed down what was their most popular attraction for shoppers. Second, they didn’t reopen that store in any other nearby location. Instead, they simply retired the flagship and let other locations in Brooklyn, Queens, and Union Square take over the retail duties of this store. When you have an attraction that visitors flock to, be sure you have a backup plan if you must move or close down that attraction.

2. They treated their stores like warehouses, rather than experience shops for kids

The biggest reason that the Times Square location was so loved by guests was that it was more than just a warehouse to go to for shopping purposes. It was an experience, with something unique that really made visiting worthwhile. Giving consumers an additional reason to walk through the doors, beyond just buying a product, is essential for building a brand.

One of the best examples of this is Disney’s retail locations, which are located all over the country. These stores are not just simple retail stores but have fully interactive experiences for kids. Most of these locations have a movie area where kids can sit and watch Disney releases while parents shop nearby; a dress-up area with mirrors, a “clubhouse” area, and more. These experience-based additions to the stores make it impossible for kids to resist, which makes it more likely that parents will be in the store longer – and thus, will spend more money. By treating every Toys ‘R’ Us location like a basic retail location, instead of creating an experience to draw kids and adults in, the chain missed a vital opportunity.

Toys ‘R’ Us CEO Dave Brandon has said that plans for the future of the company include adding more experiences to the stores that remain open, such as toy demonstrations and other fun activities.

3. They couldn’t compete with Amazon in logistics

If you are going to treat your business like a warehouse, rather than an experience, then you have to focus on competing with the world’s leading warehouse for just about everything: Amazon. While Toys ‘R’ Us’ failure cannot be totally blamed on Amazon, it’s hard to ignore the way this mega-corporation has changed online shopping. If companies can’t compete with the amazing selection, super-fast shipping, and low prices on Amazon, then they are definitely not going to perform as well.

For many businesses, the problem isn’t necessarily in how much stock they carry, but in getting it to the store or the customer in a timely manner. Managing multiple warehouses and tons of product lines is much easier when you have a POS system that automatically tracks every item in your system. This allows you to give customers accurate estimates in arrival times for products, and also helps you better predict need, so that you can eliminate how often customers are forced to wait on the product in the first place.

One thing that Toys ‘R’ Us CEO Brandon mentioned in plans to revamp the chain is a push for making stores more accessible in smaller towns. That could be one way to compete against Amazon; audiences that haven’t been able to reach your store before may appreciate the ability to see a product in person before buying.

4. Their presentation was hectic, leading to poor customer service

Any customer who had ever shopped in a Toys ‘R’ Us before could report feeling overwhelmed when walking into one of their locations. With too many different products arranged in messy displays, most of the chain’s stores could be described as hectic. This not only led to customers feeling unwelcome but also made for poor customer service. When inventory is all over the place, not neatly or stylishly displayed, and frequently in a jumble, it is hard to help customers find what they are looking for.

This is one of the biggest lessons that any small or medium-sized business can take from the Toys ‘R’ Us debacle. In many cases, limiting the variety of your in-store inventory, and making sure it is displayed in organized and stylish ways, can be more inviting than having all your inventory out in view. Additionally, giving employees access to inventory in a mobile POS system can ensure that they are better equipped to offer great customer service.

CEO Brandon mentioned that Toys ‘R’ Us stores will begin carrying fewer products in the future to cut back on this problem, which would also help simplify operations and customer service.

5. Their inventory management wasn’t well-planned or executed

Something that Toys ‘R’ Us could have benefited from was a better inventory management system. Customers frequently reported that the newest products being advertised weren’t available – in fact, there was an iconic Christmas movie made about toy stores running out of the latest and greatest toys that closely mirrored many people’s real-life experience with Toys ‘R’ Us. By not having great inventory management and poor attention to detail when ordering stock, many of the stores left customers no choice but to head to Amazon or other online retailers to find things they wanted.

The lesson here? If you are a niche retailer, it is your job to carry the most popular items in that niche. You need to know what your customers want, and when they want it. A great inventory management system for planning and executing restocks is vital for keeping your business operating smoothly. A system like Erply can help you learn your customers’ buying habits, predict what types of products will be selling when, and automatically handle orders for you so that you don’t run out of popular items during crucial sale time periods.

6. They didn’t carry original products

One of the biggest reasons that Toys ‘R’ Us struggles to compete against the likes of Amazon and Wal-Mart is that they don’t carry any exclusive product lines. Their products are the same products that you can find at other big chain retailers, and often at more savings and in more convenient ways. Customers can get the same products online without having to venture into stores where they can’t be sure that the product will even be in stock.

The lesson here? Stores must give customers a specific reason to visit them over shopping elsewhere. It isn’t enough to offer a good selection of products, great customer service, or even an experience-based sales strategy. Stores need an exclusive line of products, whether they are house products or an agreement to exclusively sell a third-party product. This ensures that customers must come to you because they can’t get what you offer anywhere else.

7. They lacked a modern strategy for customer engagement

Finally, Toys ‘R’ Us lacked an engagement strategy when it came to their customers. Customer engagement means building and nurturing relationships with customers to promote brand loyalty. Without it, customers feel no connection to the company, and that gives them even fewer reasons to return. Today’s modern customer expects to connect with a brand online (via social media and email); through loyalty programs; through personalized content; and more.

A better loyalty program and a bigger focus on engaging through the Babies ‘R’ Us registry program are two of the things that CEO Brandon said the chain would be doing in the future to improve in this area.

For small businesses, the message here is very clear: engaging with current customers to nurture long-lasting loyalty is vital to the success of a company. A strong online presence and a focus on keeping customers engaged after a sale will both be a big part of keeping a business afloat. This is why it’s important to collect customer data at the point of sale. Information like a customer’s name, birthday, what they tend to buy, what social media they prefer to use – can all help you to better connect with them in the future. A POS system that gathers some of this information at each transaction can help you build a customer database that you can use for valuable information when building your engagement strategy.

Source: ERPLY

 

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Amazon Begins Grocery Delivery from Whole Foods Market

Amazon and Whole Foods Market announced the introduction of free two-hour delivery of natural and organic products from Whole Foods Market through Prime Now, with plans to expand across the U.S. in 2018.

Starting yesterday, Prime customers in neighborhoods of Austin, Cincinnati, Dallas and Virginia Beach can shop through Prime Now for bestselling items including fresh produce, high-quality meat and seafood, everyday staples and other locally sourced items from Whole Foods Market.

John Mackey, Whole Foods Market co-founder and CEO

“We are happy to bring our customers the convenience of free two-hour delivery”John Mackey, Whole Foods Market co-founder and CEO

Customers can start shopping from Whole Foods Market selection at www.primenow.com or by using the Prime Now app available on Android and iOS devices.

“We’re happy to bring our customers the convenience of free two-hour delivery through Prime Now and access to thousands of natural and organic groceries and locally sourced favorites,” said John Mackey, Whole Foods Market co-founder and CEO.

“Together, we have already lowered prices on many items, and this offering makes Prime customers’ lives even easier.”

Prime customers can shop thousands of items across fresh and organic produce, bakery, dairy, meat and seafood, floral and everyday staples from Whole Foods Market available for free two-hour delivery.

Select alcohol is also available for delivery to customers. Prime members receive two-hour delivery for free and ultra-fast delivery within one hour for $7.99 on orders of $35 or more.

Delivery from Whole Foods Market through Prime Now is available daily from 8 a.m. to 10 p.m.

Customers can visit www.primenow.com or download the Prime Now app to enter their zip code to see if they are in the delivery area.

As reported by Bloomberg, about 7 percent of U.S. households bought groceries online last year, according to NPD Group.

Read: Growing Ecommerce Grocery Channel Will Accelerate Adoption of Meal Kit Delivery Services

Most of those – about three-quarters – get their orders delivered to their door; the rest pick it up at the store. NPD Group said it expects online grocery shopping to grow quickly, especially among young adults, who are more comfortable shopping online. And grocery chains don’t want to miss out when that happens.

Walmart, the country’s largest grocer, is making it easier for customers to order groceries online and pick them up at the store.

Target bought grocery-delivery company Shipt late last year. Kroger, the largest traditional supermarket chain, has been promoting store pickup for online orders and doing trials of home delivery.

Amazon isn’t saying where delivery will expand, but its Prime Now service is in more than 30 cities, including Chicago, Milwaukee, and San Diego.

The announcement gives Amazon yet another way to get groceries to customer’s doorsteps.

Related: Amazon Reportedly Focusing on Expanding its Delivery Trial Offering Threatening FedEx & UPS

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Half of Millennial Shoppers are Better Connected than Retail Associates

Zebra Technologies Corporation, today revealed the results of its 2017 Global Shopper Study, the 10th annual survey analyzing shopper satisfaction and retail technology trends.

The body of research revealed that while 44 percent of surveyed shoppers are still not satisfied with staff availability and customer service, overall shopper satisfaction has significantly improved since the study’s inception a decade ago.

While four in 10 shoppers surveyed in Zebra’s tenth annual retail survey cited being better connected to consumer information than store associates, more than half believe store associates armed with the latest technology improve the overall shopping experience.

And although 44 percent of in-store and 53 percent of online shoppers remain dissatisfied with the returns/exchange process, 62 percent of those surveyed appreciated associates’ use of handheld mobile devices in-store.

Jeff Schmitz, senior vice president and chief marketing officer, Zebra

“Retailers have come a long way over the past decade to enhance the in-store shopping experience, but shopper expectations continue to rise at an exponential rate.”Jeff Schmitz, SVP and Chief Marketing Officer, Zebra

Key Tenth Annual Retail Survey Findings:

  • Rising shopper expectations continue to outpace retailer in-store technology investments as a majority of millennial shoppers perceive that they are more connected than store associates. When asked about how well-connected they are with consumer information, 53 percent of millennial shoppers believe they are better connected than store associates – compared to 32 percent of Gen X shoppers and 15 percent of boomer shoppers.
  • Shoppers want faster delivery, but many aren’t willing to pay for it.  Heightened customer expectations for delivery are transforming the retail landscape. While 66 percentof shoppers want next-day or same-day delivery and 37 percent prefer same-day or sooner, 27 percent would not want to pay for shipping at any speed.
  • Retail customers want a variety of fulfillment options. 80 percent of those surveyed purchase items in-store and either take them home or ship from store to home.  Shoppers are also taking advantage of other fulfillment options, such as buy online – ship to home (64 percent), buy online – pick up in-store (34 percent) and buy online- ship to alternative location (15 percent).
  • The use of tablets in stores is improving the shopper experience.  More than half of surveyed shoppers believe technology is improving the shopping experience with 57 percent specifically citing store associates using tablets.
  • Out-of-stocks continue to plague retailers. When shopping in-store, 70 percent of shoppers have left without purchasing what they were seeking. However, when it comes to out-of-stock issues, retailers can recover six in 10 incidents with discounts or alternative fulfillment options, such as ship to home.

Jeff Schmitz, Senior Vice President and Chief Marketing Officer, Zebra Technologies:

“The results of the 2017 Shopper Study indicate consumers around the world believe that retailers have come a long way over the past decade to enhance the in-store shopping experience, but shopper expectations continue to rise at an exponential rate. Retailers continue to invest in their physical stores; we see this with an increasing overall store count and growth in convenience and mass merchant retail.”

“Sales associates armed with the right technology tools are better equipped to serve customers and increase revenue by providing the visibility and actionable insight into product information, inventory and fulfillment options that bring the online experience into the physical store.”

Regional Findings

  • Fifty-eight percent of North American shoppers said they have “show-roomed,” or looked at items in a store and purchased them online.
  • In Europe and the Middle East, 64 percent of shoppers would be willing to purchase more merchandise if they received better customer service and 52 percent value retailers who use technology to make the shopping experience more efficient.
  • Nearly one-half (48 percent) of Latin American shoppers trust sharing personal data with retailers. Moreover, retailers rank low on the list of institutions that shoppers trust with personal data.
  • In Asia-Pacific, 32 percent of shoppers would prefer to go to a retail store to pick up items purchased online or through mobile channels.
  • More than half of shoppers in both Asia-Pacific and Europe are interested in Wi-Fi and location-based in-store services such as mobile coupons.

Survey Background and Methodology

Zebra’s 10th annual shopper study included nearly 7,500 shoppers from North America, Latin America, Asia-Pacific, Europe and the Middle East who were interviewed in September 2017 by online research partner Qualtrics.

Related: The Future is Now: The Tech Trends Reshaping Retail

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Robotic Automation to Supplant 800 Million Jobs Worldwide by 2030

A new study by the McKinsey Global Instituteestimates that between 400 million and 800 million of today’s jobs will be automated by 2030.

The research adds a fresh perspective to what is becoming an increasingly concerning picture of the future employment landscape.

“We’re all going to have to change and learn how to do new things over time,” institute partner Michael Chui told Bloomberg.

In the United States, it appears it’s the middle class that has the most to fear, with office administrators and construction equipment operators among those who may lose their jobs to technology or see their wages depressed to keep them competitive with robots and automated systems.

As many as 375 million workers around the world may need to switch occupational categories and learn new skills.

What the Future of Work Will Mean for Jobs, Skills, and Wages

The technology-driven world in which we live in is a world filled with promise but also challenges.

Cars that drive themselves, machines that read X-rays, and algorithms that respond to customer-service inquiries are all manifestations of powerful new forms of automation.

Yet even as these technologies increase productivity and improve our lives, their use will substitute for some work activities humans currently perform – a development that has sparked much public concern.

Building on their January 2017 report on automation, McKinsey Global Institute’s latest report, Jobs lost, jobs gained: Workforce transitions in a time of automation, assesses the number and types of jobs that might be created under different scenarios through 2030 and compares that to the jobs that could be lost to automation.

The results reveal a rich mosaic of potential shifts in occupations in the years ahead, with important implications for workforce skills and wages.

The key finding is that while there may be enough work to maintain full employment to 2030 under most scenarios, the transitions will be very challenging – matching or even exceeding the scale of shifts out of agriculture and manufacturing we have seen in the past.

  1. What impact will automation have on work?
  2. What are possible scenarios for employment growth?
  3. Will there be enough work in the future?
  4. What will automation mean for skills and wages?
  5. How do we manage the upcoming workforce transitions?

Jobs Lost, Jobs Gained: Workforce Transitions in a Time of Automation

Download the Report

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Microsoft Reinvents its Supply Chain by Leveraging SAP Ariba & Intrigo Systems

Microsoft Corp. has one of the most complex supply chains in the world.

And to keep it humming and ensure supply keeps up with demand for its hottest products, the company is reinventing its supply chain.

In a newly released Webcast (watch the video above), the company discusses how it is teaming with SAP Ariba and Intrigo Systems to create a scalable, modern platform to support the efficient, cost-effective manufacturing of its most popular products, including the Xbox and Surface.

“At Microsoft, our mission is to empower every person and organization on the planet to achieve more. And our strategy to achieve this is to build best-in-class systems and platforms and productivity systems,” said Ali Khaki, Principal PM, Supply Chain Engineering, Microsoft.

“When we looked at our supply chain, it was clear we needed to build a flexible, scalable platform that could support the complexity of our hardware business.”

And it is using SAP Ariba solutions for direct spend to do it.

“The Ariba® Network is the backbone for Xbox and Surface line of products supply chain,” Khaki said.

Through the Ariba Network and the cloud-based applications delivered on it – including SAP Ariba Supply Chain Collaboration™, Microsoft has created a modern platform from which it can safely and easily collaborate with multiple tiers of contract manufacturers and suppliers across key supply chain planning and execution processes, including:

  • Sharing production forecasts, orders, quality, and inventory information.
  • Anticipating and resolving supply assurance problems.
  • Onboarding suppliers.

And the company is seeing results. Since implementing the solutions with Intrigo’s support, Microsoft has:

  • Enabled multi-tier planning and collaboration with contract manufacturers and suppliers.
  • Reduced the supplier commit process from three days to 30 minutes.
  • Cut the time it takes to onboarding for suppliers from four months to four days.
  • Standardized vendor engagement through B2B, flat files and web-user interface.

“It’s a very clear and transparent process because of all the communication that happens within the SAP Ariba system itself,” Khaki said.

“And it has allowed us to create a very positive user experience for everyone involved in it.”

To hear more from Khaki on Microsoft’s supply chain transformation, listen to the Webcast “Microsoft Re-invents Its Manufacturing Supply Chain” above (download slide deck).

To learn more about SAP Ariba’s direct spend solutions and the value they can deliver, visit www.ariba.com.

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