Supply chain partners must help retailers innovate
As every retailer knows, the COVID-19 pandemic and resulting economic crisis have been incredibly challenging for the industry. Between statewide lockdowns, the need for enhanced safety and hygiene measures, and slowed economic activity in certain markets, the industry’s already narrow margins have gotten even slimmer.
To survive and thrive in the COVID market, retailers need innovative and forward-thinking supply chain partners and services to help them deftly navigate an uncertain landscape. When evaluating your supply chain to keep your business one step ahead of these challenges, we recommend that certain operational considerations be taken into account.
The COVID-19 crisis has greatly accelerated certain pre-existing supply chain industry trends. Namely, businesses need to identify operational and logistical efficiencies both to lower costs and adapt to a volatile market with changing demands. As a retailer, it is invaluable to work with supply chain partners — distributors, third-party logistics providers and other organizations — that prioritize innovative solutions and invest in technological advances for their, and your, futures. For instance, for pallet pooling and distribution services, a closed-loop shipping model offers greater transportation efficiency and saves time and money for all involved.
Automation, including RFID chips, integration with the Internet of Things, and track-and-trace technology, is a vital element in the supply chain that reduces costs, generates data for evaluating supply chain efficacy, and minimizes direct human contact during the pandemic. By providing these services and technology, supply chain partners demonstrate their commitment to innovation that can address future market challenges.
It is likewise important for supply chain partners to invest in these and other innovations well in advance, rather than scrambling to address issues as they arise. Hygiene and worker safety have taken much of the spotlight in the wake of the pandemic. Many companies now offer some form of cleaning or sanitization for their associated products and services, but those that invested in this area well before the COVID crisis will have distinct advantages.
Supply chain providers that have established sanitization programs years before this pandemic will have more testing and development behind them than those that did so after March 2020, meaning greater efficacy and reliability. The same principle applies to track-and-trace technology and other innovations that increase efficiency. The ability to adapt to the COVID world is important, but the businesses most poised to succeed will be those that already evolved into a state of preparedness even before the pandemic hit.
On a similar note, the importance of environmental sustainability has grown rapidly in supply-chain management, and a retailer would be remiss to not include it as a consideration when evaluating supply chain partners. Consumers are increasingly looking to businesses to demonstrate improved environmental stewardship; yet beyond good public relations and marketing, sustainability efforts also can produce significant savings and business efficiencies. For example, several major retailers have urged manufacturers and distributors to move toward recyclable plastic pallets, due to their durability, lighter weight, and decreased carbon footprint.
Retailers everywhere are facing an historical challenge in the COVID crisis. Supply chain partners that go above and beyond in operational efficiency, technological investment, hygiene, and sustainability can help position their retail clients best to adapt to this volatile landscape. As a retailer, to ask for anything less from your partners is a disservice to your hard work and your future.