Read the latest Total Retail article by Andrea Morgan-Vandome, CMO of Celect, to learn how retailers crack the "last mile" supply chain challenge using Celect advanced analytics and optimization technologies to connect the dots between available data points and provide real-time context on what, when, where and how much customers will buy.
As Amazon.com rewrites the rules of retail, retailers are struggling to adapt and stay relevant. And it’s only getting harder to compete as the online retail giant continues to up the ante — most recently introducing one-day free shipping to Amazon Prime customers. Instead of forging new and uncharted paths, retailers can succeed by taking a page from Amazon’s own playbook and beating it at its own supply chain game.
This approach starts by moving away from traditional fulfillment centers and rules-based order management systems to an Amazon-inspired “ship from store” model, essentially transforming disparate store locations into one unified distribution center to enable faster, more cost-effective order fulfillment. But it doesn’t end there. To truly crack the “last mile” supply chain challenge, retailers must also employ advanced analytics and optimization technologies to connect the dots between available data points and provide real-time context into what, when, where and how much customers will buy.
This enables retailers to match inventory to the best view of demand. For many retailers, online order fulfillment is accomplished by pulling merchandise from the closest stocked location to the customer without an eye to inventory coverage. This can result in both understocked stores with high inventory turnover and piles of extra inventory that end up being sold at significant markdown. In fact, U.S. non-grocery retailers lost $300 billion last year in revenues due to markdowns caused largely by poor inventory planning and misalignment. This major challenge persists, as many retailers continue to rely on historical analysis, gut instinct and averages to run their businesses.
Leveraging artificial intelligence (AI) and machine learning (ML) makes the once-impossible job of matching inventory to the best view of demand possible. These advancements can provide retailers...