Time to turn around inventory falls by two days says new report
The median number of days for a return to be added back into an inventory for resale has decreased from seven days to five, marking out a focus on speed in the retail supply chain
Customer demands for faster and faster service are having an effect across the supply chain finds eyefortransport’s new D3 2019 report. Indicative of this is the falling time retailers are taking to get returns back into their stock. The median time for retailers to move returns back to inventory ready for resale has fallen from 2017 to 2018, from a median of seven days down to five days. Furthermore, 44.2% of retail respondents report that their average time to restock returns is three days or less, marking out a clear focus on agility of inventory that can accommodate a more e-commerce-centric environment and a higher returns volume.
Further marking out this move to a more agile distribution network that can work better and faster around customer needs is the growing integration of the distribution cycle. Increasingly retailers and manufacturers are looking at building distribution capabilities into more and more facilities and the sharing of inventory and fulfilment engines. There was a noticeable jump in the percentage reporting some form of integration in their retail, wholesale and e-commerce operations from 2017 to 2018. Just over three quarters of respondents reported that they had integrated to some degree rather than distributing out of separate facilities for each channel, which is a big leap over the 57.3% reporting this level in 2017. The biggest jump was in the percentage reporting that they are operating fully integrated distribution networks, which rose from 17.6% in 2017 to 30.2% in 2018.
More integrated supply chains are being driven by the challenges presented by a growing e-commerce environment, with the most resource-intensive and problematic part of this being the last mile. Last-mile delivery operations are already largely the most expensive and complex part of the retail supply chain due to the number of moving parts involved, the requirements to shift inventory across different transport modes and to do so quickly to meet the needs of the customer. This latter part has become even more important heading into 2019 as customer expectations of last-mile service are rising and it is a critical component on which brands are judged in the eyes of customers, making it a potential competitive advantage. However, brands need to do so without costs spiralling out of control, particularly in the current tight labour market.
To find out more about the state of retail in 2019, download the free report now. This exclusive report features:
- An industry survey focused on retailers, e-tailers, brands and manufacturers that throws light onto the major trends emerging in 2019.
- Analysis that helps you understand what is happening and why the landscape is changing.
- Interviews with multiple supply chain experts from multiple angles.
- More than 20 charts and graphics explaining clearly key areas of investment, major challenges and where the supply chain is being transformed most.
Experts featured in the report include:
- Tobias Schulz, Senior Business Consultant, Quintiq
- Himanshu Rautela, Senior Manager, Supply Chain Planning, Walmart
- Gabi Weisel, Director Global Indirect Procurement, Estée Lauder
- Brad Smith, COO, Jack Grace
- Ryan White, Director of Freight Initiatives, New York City Economic Development Corporation