For brands, retailers and their trading partners today, meeting ever-changing consumer demand while preserving margins requires a new level of domestic and global supply chain excellence. Today’s fast moving omni-channel world requires orchestration of all moving parts of the supply chain. Multiple parties need to collaborate in near real-time, on a single platform to manage the flow of data, goods and capital. Constant fine tuning is necessary to align supply with demand. For that to happen, all parties require clear visibility into a single version of the supply chain truth to ensure goods are produced at the expected cost – and sold at full margin.
Unfortunately, traditional tools for communicating between retailer, brand and trading partner are outdated. Many businesses still rely on ad-hoc spreadsheets, emails and phone calls throughout the transaction lifecycle, stacking up costs and delays in the supply chain.
Cloud Technology: A Good Fit for the Retail Supply Chain
As businesses start to embrace cloud technology, many global brands and retailers are finding that cloud-based solutions are a good fit for managing their global supply chains. Instead of sending separate updates to multiple trading partners regarding changes to an order, a collaborative model for the supply chain allows brands and retailers to post their updates in one place, where they are viewable by the entire supply chain network. This is the same network model of Facebook, LinkedIn, Pinterest etc. extended to your supply chain network.
Applying Cloud Technology to the Supply Chain
For Indian retailers, connecting the entire supply network in the cloud opens the door to new possibilities for speed, efficiency, savings, visibility and agility. As the availability and affordability of internet access for Indian businesses continue to improve, cloud technology becomes a simple, user friendly and low cost alternative for retailers and suppliers to exchange information. Processes from planning to purchase order, through settlement and delivery can be streamlined better when all parties are connected, sharing information in near real-time and on a single platform. Here are six examples of how global retailers are leveraging cloud technology for improved supply chain collaboration:
- Improve Performance through Flexibility and Communication: Prior to each season a brand communicates its capacity and raw material needs with suppliers and mills. Each supplier validates whether it can meet that need or identifies lack of coverage early. At the time of PO issue, suppliers are prepared and all connected parties are instantly updated in case of changes.
- Realize Full Margins by Eliminating Unexpected Delays: A brand’s sourcing department is automatically informed in real time of any significant delays anywhere in the goods sourcing process. Whether a delay originates in the availability of raw materials, during production or transportation, the brand is instantly alerted. The delay is identified and the brand has enough time to find the best possible solution to preserve a full margin delivery.
- Increase Speed through Flawless Factory Floor Execution: A manufacturer uses a single platform that handles all of its customers’ requirements with regards to automated packing, scanning and shipment building to ship store-ready cartons or facilitate fast cross docking at its customer’s DC. At the same time, they improve packing accuracy and minimize chargebacks. Through the cloud, its factories have the tools to accurately pack customers’ orders, print or order compliant carton labels, and generate a customer compliant inbound shipping notice.
- Mitigate Risk through Party Screening & Transparency: A global brand had a shipment of fabric scheduled to reach a vendor in North Africa. A name on the purchase order matched a name on a denied party list and the transaction triggered six red flags. A cloud-based sourcing solution that automatically tracks and scans transaction parties notified the brand immediately and the company halted the shipment. The brand modified its plans in time to ensure compliance.
- Do more with the same: An outdoor apparel brand handles $500M in sourcing settlements with one person in accounts payable. A mid-size apparel company replaced all letters of credit with an open account platform without adding any staff to handle the supporting documentary process. Not only did they save their company a lot of money, they helped their suppliers save as well.
- Optimize Capital: A global apparel provider utilizes a self-funded early payment program in the cloud and places information onto customs invoices to lower its duty payments. Using the cloud-based system, the brand obtains discounts from suppliers in exchange for delivering payment within 5 days from shipment, and pays duty on a lower invoice value. Suppliers obtain capital they need within days at rates 20-30% lower than financing available to the supplier locally.
Just as the global consumer, the Indian consumer is increasingly knowledgeable, tech savvy and demanding. In today’s omni-channel world consumers want the right product, at the right time, for the right price available through the channel of their choice.
An agile and collaborative supply chain can make all of the difference in meeting consumer demand and optimizing sales. A typical sourcing transaction involves 5 to 15 different parties and keeping all parties synchronized at all times has always been a hassle. Traditional methods of communicating are slow and inefficient – and cannot keep up with the changes occurring on the front-end. Cloud technology enables a collaborative model for the supply chain to enable all parties to communicate and transact in real time. With the right strategy, technology and support, your supply chain can move at the speed of the modern consumer. And that’s essential for optimizing your bottom line.
“Instead of sending separate updates to multiple trading partners regarding changes to an order a collaborative model for the supply chain allows brands and retailers to post their updates in one place where they are viewable by the entire supply chain network. This is the same network model of Facebook LinkedIn Pinterest etc. extended to your supply chain network.”
“Cloud technology enables a collaborative model for the supply chain to enable all parties to communicate and transact in real time. Brand can obtain discounts from suppliers in exchange for delivering payments quickly, and pays duty on a lower invoice value. Suppliers obtain capital they need within days at rates 20 30% lower than local financing.”
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