During a time of increasingly unpredictable and demanding global economic environment, you require flexible distribution strategies to help navigate this constantly changing environment. Unfortunately, only a few companies are taking large enough steps in to improve their supply chain performance significantly to satisfy customer requirements for speed and experience.
Strategies like re-configuring store real estate to run “mini-DC” operations and putting lockers in urban locations for product pick up are becoming more common to provide flexible order fulfillment options. While this strategy has become very successful, it may not make the most sense for your company based on its current footprint. Other approaches can work for companies with limited stores or ability to stand up locker locations. The future of retail is going to be a combination of physical stores for customer experience along with the convenience of eCommerce. While there is continuous growth of eCommerce, there is very acute focus on controlling shipping costs. Offering different shopping options for customers will certainly help with customer acquisition and loyalty but it needs to be supported with flexible distribution capability to ensure a sustainable and profitable supply chain.
Flexible distribution strategies also help with risk mitigation. What happens if there is a flood or fire in one of your main distribution centers? How do you react? Having the ability to establish pop-up facilities, maintaining a network model to handle emergencies, and increasing capacity and solutions for peak are mandatory for successful execution during uncertainty.
The benefits are not limited to customer experience and risk mitigation. Companies that use flexible distribution methods typically see benefits in areas of labor flexibility, inventory placement, and forecasting as well.
Are you flexible? Do not get left behind in this ever-changing global market. Fortunately, there are strategies that allow companies to crawl, walk and run in becoming more flexible. If you would like some help with your analysis, implementation or optimization, contact Bricz at info@bricz.com!
Contributor: Nirav Shah, Director of Services at Bricz