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It's been a challenging year, but news that retailers might not meet customer demand due to supply chain inefficiencies is alarming.
According to a recent industry report*, the supply chains supporting the UK grocery retail sector fail to deliver accurately on over 80% of occasions. Orders are not fulfilled, labels are incorrect and stock information is inaccurate. Left unaddressed, these failures will cost the industry as a whole at least 700m over the next five years. However, the impact on individual retailers could be far graver.
These errors are management failures. Failures to invest in processes and technologies that not only promise, but are proven to cut the cost, increase the productivity and raise the efficiency of the supply chain to levels that will have the customer coming back for more.
It is time for best practice if customers are to be served. It is time to apply a backbone to the retail supply chain. Everything hangs off its efficiency, but the question must be, if so many are getting it wrong; how do we get it right?
The answer is simple; look at the retailers on the high street that are winning; those whose customers are returning time and again to boost profits. It is time for retailers to start talking. Voice-directed supply chain management underpins the majority of the leading retailers. Those that are booming, from Sainsburys to Argos, have their supply chains under control.
They know where every stock item is. They know which orders to load when and which products to replenish. Voice-directed work in the warehouse has driven order accuracy levels to almost 100% for these retailers. Productivity is up 25% just by making processes more efficient and freeing up the workforce to fulfil.
This success in the supply chain is now so vital to these businesses that they are bringing the technology in-store. Argos was the first retailer in Europe to use Voice for stock put-away and stock room management, and in 2010 it looks like many others will follow. Those that dont will share little more than the 300 million in projected lost sales set for the next five years if they dont start addressing customer service from the supply chain forward.