The next evolution of the supply chain will be all about visibility RetailWire – RetailWire

Mar 15, 2021

PVH Corp., the parent of Calvin Klein and Tommy Hilfiger, is more highly prioritizing real-time inventory visibility to better adjust to potential disruptions coming out of the pandemic.

Eileen Mahoney, PVHs CIO, told The Wall Street Journal, Its allowed the business to get a better handle on where demand is, where the consumer is shopping, and were now going to be nimble about where inventory is.

A new report from the Capgemini Research Institute finds 66 percent of consumer products and retail (CP&R) organizations saying their supply chain strategies will change significantly in the next three years, with much of the attention on heightened visibility.

The supply chain realignment is expected to focus around three areas.

Demand sensing

Sixty-eight percent of CP&R organizations surveyed faced difficulties in demand planning due to a lack of accurate and up-to-date information on fluctuating customer demand during the pandemic. Two-thirds plan to segment supply chains according to demand patterns, product value and regional dimensions post pandemic, while 54 percent will use analytics/AI-machine learning for demand forecasting.

Visibility becomes critical

Facing difficulties quickly increasing or decreasing production capacity, 58 percent of retailers and 61 percent of consumer product organizations are planning to increase investments in digitization of supply chains to improve visibility. Forty-seven percent are planning to invest in automation, 42 percent in robotics and 42 percent in artificial intelligence. Sixty-four percent and 63 percent of organizations are also planning to make extensive use of artificial intelligence and machine learning across transportation and pricing optimization respectively.

From globalization to localization

Seventy-two percent of consumer product organizations and 58 percent of retailers are actively investing in regionalizing or localizing their manufacturing base or nearshoring production to prevent future disruption.

The study found respondents faced significant challenges across the supply chain in the wake of the crisis, including difficulties in end-to-end monitoring of the supply chain, cited by 72 percent; delayed shipments/longer lead times, 74 percent; and bottlenecks at ports or at borders, 68 percent.

DISCUSSION QUESTIONS: How important will visibility be in helping reduce supply chain disruptions in the future? Which of the three themes for improving supply chain agility cited in the article is most important?

"Real-time inventory visibility is critical to address and react to supply chain disruptions and also to improve customer engagement. "

"To design and predict individual product demand in real-time resulting in getting the right product, to the right place, at the right time requires new thinking on both sides "

"Visibility has been a key to the supply chain for years now, but the focus on real-time, omnichannel inventory and agility has become paramount in the last 24 months, no doubt"

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The next evolution of the supply chain will be all about visibility RetailWire - RetailWire