“Computer technology has redefined Logistics and Supply Chain Management in the retail Industry”
In this chapter the objectives of the dissertations that were set initially in section 1 are analysed over the research conducted up to this point. This will throw light on the achievements of the research in order to derive on a strong conclusion.
Objective 1: Find out if and how the retail industry implements supply chain management and logistics.
From the overview of the retail sector we understand that the retail business is an integral part of any product’s supply chain since the retailer is invariably the point of contact to the consumers. It is also established that for efficient management of the supply chain, it is essential to include the retailer in the network from the beginning itself in order to achieve a high level of production to sales ratio. Alongside, it is evident that the fashion industry is highly volatile in nature with increasingly changing interests of the customers and stiff competition from both the high street retailers and supermarkets. These factors have further justified that the efficient supply chain management is highly critical to gain competitive advantage in the market. From the four stages of integration that was represented in section 1, it is clear that the customer is the primary element in the supply chain management and the effective integration should account for the supply of the right product at the right place in the right time. The innovation in IT and its use in the logistics have proved successful by increasing the efficiency of the whole system itself. Also the effective co-ordination between the internal and external supply chain is essential for the successful implementation of the supply chain management of an organization. Apart from the supply chain integration it is also established, that the customer, company and the competitors are the three major elements of the supply chain strategy of the company.
From the analysis of the organizations (or participants) those comprise of the supply chain of the fashion products it is evident that the supply chain of an organization in the fashion in the fashion industry utilizes the information on the customer, market demand and forecasts to initiate production and sales of the products in the market through the retailers. Apparently, this analysis in section 2 has presented the reader on how the supply chain management is managed in the retail sector. Alongside, the means of reducing the costs in the business so as to increase the profit were also discussed in order to establish a profound understanding among the readers about the critical nature of the supply chain management especially logistics and the critical nature of information in the supply chain that will reduce costs.
Objective 2: Critically analyse their impacts upon the management of backstage operations through to the final consumer.
From the analysis of Quick Response (QR) strategy in chapter 2 it is clear that the supply the Quick response systems like the Electronic Data Interchange, Electronic Point of Sale Systems and the bar coding are the three major areas of achieving control over the costs associated with the logistics and supply chain in the organizations especially in the retail stores where the end product sales provides the critical information on the day-to-day demand of the products. This is essential more in the fashion industry due to its volatile nature and the stiff competition in the market. The high impulsive purchasing described by Fernie and Sparks justifies the fact the fashion retailing is essentially dependant upon the demand among the customers in order to maintain the level of production to meet the demand. This apparently proves that the sales will vary with respect to the impact made by a specific fashion design among the consumers and the extent to which they are instigated to purchase a product of that nature.
Alongside, the analysis on the shelf life of the fashion products has proved that the effective management of the supply chain in the fashion retailing is essential and impacts heavily on the backstage management of the operations in the organization without proper information on the demand and supply of the products. The drop in the sales of the summer range of fashion clothing in Marks and Spencer during the year 2003 is a classical example of the impact of the failure to manage the supply chain of the fashion products in the product pipeline on the management of the backstage operations in the business. Hence the need to manage the supply chain to meet both the quick response strategy as well as to reduce the costs associated is essential in order to reduce a negative or a sudden impact on the management of the backstage operations of the organization.
Objective 3: Evaluate the effectiveness of logistics and supply chain management as methods of gaining competitive advantage.
The analysis on the lead time gap and the strategies to reduce the lead time gap by the swift transfer of information on the market demand to the supplier across the various elements of the supply chain in order to enable coherent operation within the supply chain have proved that information plays a critical role in the efficiency of the supply chain management in the fashion retailing business.
Alongside the synchronised lead-time management, which was discussed, proves that an uninterrupted information flow is essential for reducing the lead-time as well as reduce the costs associated with storage and transportation. It is also established that transparency of information is essential to achieve a win/win supply chain strategy in the organization.
The integration of the EPOS systems with the stock control of the company will apparently enable quick response to the change in level of the stock. Alongside, the discussions of using EPOS systems not for just billing but for integrated management of the stock and order processing has proved that strategies based on technology to improve the supply chain will be successful when implemented across the entire supply chain of the organization so as to enable free flow of information.
Alongside, the use of EDI and the EPOS with the barcode and scanning systems as discussed in Section 3 will increase the speed of transfer of information among between the various members in the supply chain thus enabling them to be proactive to the market trends and control the production of the products effectively. These will apparently enable the organization to gain control of the competition and the market trends and hence make concrete decision on the type of products being sold in order to gain competitive advantage as it is established that the right product, in the right place at the right time is the necessity for a successful business venture in fashion retailing.
The discussion on the structure of an organization and the emphasis on adapting the Organic structure justifies that for effective supply chain management, not only the information flow must be transparent but also the objectives of the organization at different levels must reflect upon each other so that a flat structure can be obtained. The use of resources through temporary work group systems further argues that the organization structure is a critical element in achieving measurable results with the technology implementation in the supply chain of the organization.
Apart from the organization structure, it is essential to note that the organization must treat the supply chain strategy as a part of the organization’s overall strategy, which will obviously enable the effective integration of the various technological elements of the supply chain management across the organization.
Alongside, the strategy of warehouse centralization and the distribution centres in the geography proves that the Information Technology plays a critical role in achieving the efficient integration of the distribution centres and the centralization of the warehouse especially with retailers who deliver the fashion products ordered to the door step of the customer where time is a critical constraint and the need to achieve timely delivery of products is essential for customer satisfaction.
The discussion on the transportation, which is the actual action of transporting the products from the warehouse or the producer to the retailer, throws light on the effective utilization of information through the traffic information and vehicle utilization. The use of alternative sources of fuel that are cheap and environment friendly further justifies that the organizations are concentrating on reducing costs associated with the supply chain management in their organization.
From the above statements it is evident that the research has achieved the objectives stated initially in the beginning of the report.
Conclusions:
From the analysis on the supply chain of the retail sector it is evident that the competitors in the retail sector for fashion products are increasingly using technology to integrate their supply chain with the entire business operation of the company. This is apparently because of highly volatile nature of the fashion industry and the need to maintain an effective supply to demand balance. The increased need for a proactive business operation in order to reduce the costs has apparently forced the organizations to deploy innovative technology in their supply chain.
Also the integration of the technology like the EDI, EPOS and Bar code scanning with the supply chain management of the organization has proved successful with the increased transparency of the information flow in the supply chain of the organization. Alongside, it is clear that accurate information on the market trends and the demand for the products is critical for the fashion industry to manage the demand supply balance in the company.
Alongside, the volatile nature of the customer expectation and their reaction to fashion trends is has forced the retailers in the fashion industry to deploy the technology increasingly in the supply chain in order to reduce the costs associated with the storage and floor space.
Apart from the retailer perspective of the supply chain, it is also clear that through the swift transfer of accurate information in the supply chain the manufacturer can become proactive by controlling the level of production of a particular range of product in the market. With the increased outsourcing of the manufacture of the clothing products in the UK, the competitors are increasingly in need of accurate information of the market trends in order to enable the shipment of the appropriate product from the production centre to the retail store. The increased outsourcing by the fashion retailers like NEXT, H&M, Debenhams and Marks & Spencer has apparently increased their use of computer technology in the supply chain. The increased outsourcing of the manufacturing of the products is due to the increased use of the technology to gain accurate market information in order to achieve competitive advantage.
Alongside, the use of computer technology is not only to achieve quick flow of information within the supply chain but also to predict the demand and market trends through the analysis of the information gained on a day-to-day basis. The use of ERP and Customer Relationship Marketing technologies are focused on the resource planning and customer relationship respectively. The technology in the supply chain management of a retail organization in the fashion industry not only leverages quick transfer of accurate information but also the effective use of resources in order to increase the return on investment by the organization.
Thus, to conclude this report, it is evident that computer technology has redefined logistics and supply chain management in the retail industry. The fashion industry retailers are increasingly using the computer technology not only to integrate their supply chain but also to gain concrete information on the market trends and the customer interests, which is vital for the decision-making. Alongside, with the flat organizational structure and the use of computer technology in the supply chain and logistics of the company, competitive advantage can be leveraged in the market thus gaining leadership in the market. Hence it is clear that computer technology has not only redefined the supply chain and logistics in the retail sector but revolutionised the entire business process to become information centric in the retail sector of the UK.
