RETAIL INTRODUCTIONAnshuman Duttawww.anshuman-dutta.blogspot.com презентация

ANSHUMAN DUTTA

Retail Formats

Location
High street
Destination
Convenience store

Size
Shopping Mall
Supermarket
Hypermarket

Ownership
Private/Individual Owned
Public Owned/Listed
Franchisee

Merchandise Range
Supermarket
Hypermarket
Specialty
Category Killer

Merchandise Segment
Music (Performance)
Apparel/ Footwear
Drugs/ Pharmacies
Electronics

Price
Discount
EDLP
Factory Outlet
Single Price Denomination

Business Model
B2B
B2C

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Merchandise Hierarchy
Division
Dept
Category
Sub Category
Brand
Style
Options
SKU

Men’s Apparel
Trousers
Formal
Khakis
Reid and Taylor
Flat Style
Singles Pack
LW FHS B 32

Time Hierarchy
Year
Qtr
Period
Week
Day

09-10
2st
May
15
4

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Roles: Buyer – Merchandiser - Allocators

Colors, Sizes, Dimensions

Pack Size – Unit Of Measurement

Price: Cost and Retail

Hierarchy (Dept – Sub Dept – Class – Sub Class)

Vendor

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Depth of merchandise
- the number of items in a category (SKUs)

Merchandising

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Open to buy is the dollar amount budgeted by a business for inventory purchases for a specific time period
Determines how much was spent and how much is left to spend

Pricing/Promotion Management

C

Pricing

Cost + Fixed Margin = Grocery

Cost + Margin Based on Demand = Apparel

Trade Promotions Management: (1) Brand Based, (2) Location Based, (3) Account Based

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Additional supply chain touch points that can be improved with POS data. These include:

Designing key performance predictors (KPPs)

Including POS data as part of the organization's Sales Inventory Operations Planning (SIOP) process

Leveraging POS data with shipment data.

Measuring the tradeoffs between forecasts and supply chain flexibility

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The 3 key processes in the supply chain are:
Inventory Management
Warehouse Management
Transportation Management

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Predictive - what will happen?  

Prescriptive - how to make it happen?

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Ocean Shipping Container: - Malcom McLean invented the standard steel shipping container first implemented in 1956 at the port of New Jersey

Electronic Data Interchange (EDI)  –Started when computer systems first had the capability to transfer data to other computer systems. Enables the exchange of electronic business documents.

Material Resource Planning (MRP) – Josef Orlicky makes the first MRP system in Racine, Wisconsin. A year later, Gene Thomas from IBM invents the Bill of Materials Processor. For the first time, manufacturers could break down the BOM on a computer

Universal Product Code (UPC) – a company called Logicon wrote a standard for something close to what became known as the Universal Product Code (UPC) to identify via a barcode a specific SKU. The first implementation of the UPC was in 1974 at a Marsh's supermarket in Troy, OH.

Enterprise Resource Planning – In 1990, Gartner Group first employed the acronym ERP which came to represent a larger whole, reflecting the evolution of application integration beyond manufacturing. 

Dell Direct Orders – Michael Dell started his company in his dorm room shipping computers to customers. This developed into a unique model of make to order that provided custom configurations to customers and shipped to them

FedEx Tracking System – After re-inventing the category of express parcel shipments, FedEx went a step further by developing a new computerized tracking system that provided near real-time information about package delivery. Outfitting drivers with small handheld computers for scanning pick-ups and deliveries, a shipment's status was available end to end.

P&G's Continuous Replenishment: Order patterns were totally dependent on sales and retail buyer input until P&G bought a mainframe application from IBM for "continuous replenishment" re-wrote it for retail, and changed that entire value chain by driving orders based on DC withdrawals and sales data.

Walmart Cross Docking – With rapid expansion in the number of Walmart stores, the company needed an effective communication system. They introduced the first cross docking system, which enabled them to track goods across all their DCs and stores.

The Toyota Production System:  Pioneered by Toyota's Taiichi Ohno and a few colleagues, TPS not only is the foundation for today's lean manufacturing and supply chain practices, but the concepts have penetrated virtually every area business

Rise of the PC and Internet – this allowed the development of decision support systems for the supply chain on PCs as well as collaboration platforms for companies with their trading partners. 

HP Postponement – The ability to delay differentiation in product design can convey many advantages. HP was the first to use this approach delaying some of the localized decision for its DeskJet printers by customizing the printers at its local distribution centers rather than at its factories. 

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2000s – RFID , Track and Trace – RFID was developed at the MIT Auto-ID Center. It is a code-carrying technology, and can be used in place of a barcode to enable non-line of sight-reading. Synonymous with track-and-trace solutions, and has a critical role to play in supply chains.

2. Invest in flexibility: "Identifying the right trade-off between risk-mitigation strategies and cost is an important challenge." Companies need to identify how to get flexibility either through process, system, or product design and where is right to invest.

3. Apply the same operations strategy across the board: You can't deploy one supply chain across multiple channels, customers and products. Each product may have different requirements and characteristics. Product characteristics have to be matched with supply chain strategies. David Simchi-Levi uses the example of Gap Inc. The company owns three separate brands: Gap, Banana Republic and Old Navy. Each of the brands has a different customer value proposition. Because of this, there is a need for multiple supply chains to fit each type of customer.

4. Deploy the latest and best Information Technology (IT): "IT investment has to be driven by business needs." The latest technology cannot drive a change in the business because the company wants to keep up with the latest trends.

5. Ignore IT because it is just another commodity: Don't ignore IT altogether. While previously we discussed (Myth #4) that all technology is not necessarily right for your business, sometimes when technology is combined with the right business processes for supply chain integration it can significantly improve performance.

6. Treat Corporate Social Responsibility(CSR) as charity: Many executives believe that CSR is a waste of money and time; however, in many situations "when CSR is aligned with business value, it generates a new stream of revenue or an innovative way to reduce costs."

7. Leave Operations to the functional areas: "Operations significantly affect the firm's revenue and profit goals precisely because of their ability to control costs, shorten response times, and improve customer service." All of senior management needs to be involved with defining goals in Operations.

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Shrinkage = Actual Physical Inventory – Book Value

Research says the % of reasons for shrinkage
Employee theft, 46.8%
Shoplifting/ Customer Theft 31.6%
Administrative error, 14.4%
Vendor error 3.75%
Unknown error 2.86%

Loss prevention is all about protecting the assets of the company and the store.

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Supply Chain Analytics:
Visibility in SKU availability, Perfect order fulfillment, optimizing inventory holdings
Supplier performance measurement
Merchandise Analytics:
Optimize merchandise mix
Track promotion effectiveness
POS Analytics:
Understanding Demand Patterns
Measuring store ,category, SKU performance
Customer Analytics:
Understand most profitable customers and cost to serve them
Assortment planning and optimization

Low Inventory Turns :
Lack of accurate inventory information
Sporadic Demand of many items
Poor Supply Chain visibility
Demand Response
Lack of demand planning & forecasting processes
Very Price Sensitive Customers, volatile demand pattern
Total Landing Costs :
Some suppliers, multiple tiers of distribution
Lack of Transportation Management Systems
Lack of Distribution planning & scheduling mechanisms

Customer Experience & Loyalty:
Providing seamless Omni-channel experience
Personalized shopping assistance
Personalized promotions
Social Media engagement:
Brand crises management
Search Engine Optimization & Social Media Optimization
Multi-channel Fulfillment :
Supply Chain & logistics pressures
Smaller, customized package sizes lead to high transportation and labor costs

In-store Challenges

Analytics Challenges

Supply Chain Challenges

Omni Channel and Digital Media Challenges

Challenges in Retail Industry