Walmart, Macy's, JCPenny, Marks & Spencer, Façonnable, American Apparel, and others are implementing item-level RFID in a big way. Last year, well over one billion apparel items were tagged. That number is expected to rise substantially this year.
Analyst Insight: For the past 30 years, sales and operations planning (S&OP) has been espoused by the Oliver Wight organization based on its founder's concepts. It has manifested itself to include inventory (SIOP) and has morphed into integrated business planning (IBP). However, only within the last five years, has it been heralded and crossed the chasm to mainstream business practice. We think it may only be the tip of the iceberg though, not the core solution to step-change improved performance. - Rich Sherman, Supply Chain Discipline Expert at Trissential
Walmart, already struggling to woo shoppers constrained by higher taxes, is "getting worse" at keeping shelves stocked, the retailer's U.S. chief told executives, according to minutes of an officers' meeting obtained by Bloomberg News.
According to a new survey of 600 executives from Deloitte "” "The Ripple Effect: How Manufacturing and Retail Executives View the Growing Challenge of Supply Chain Risk" "” global executives are increasingly concerned about the growing risks to their supply chains and costly negative impacts such as margin erosion and inability to keep up with demand.
Jason Denmon, apparel industry executive with Fortna, offers advice on how companies can utilize a common distribution center for servicing multiple brands or channels - and why it's so tough to get it right.
Analyst Insight: Supply chain has often been an afterthought for pharmaceutical manufacturers. The patent cliff, increasing reliance on generics, and price pressure from payers all create considerable margin pressures on pharma companies as well. This forces them to pay closer attention to operational efficiencies, including the supply chain. However, less noticed is the impact that evidence-based medicine and outcome-driven payment strategies have, compelling pharmaceutical manufacturers to more closely manage their entire end-to-end chain, especially on the downstream side. - Bill McBeath, Chief Research Officer, ChainLink Research
Analyst Insight: With the trend toward multichannel and omnichannel supply chains, pressure is mounting for inventories that were intended for one type of demand to be called on to serve another. This conflict can lead to underserving the demand for which the inventory was planned and raise issues between organizational entities that lean toward protectionism, undermining competitiveness. Solving this issue requires effective decision-making processes that occur in real time based on corporate objectives. - Ralph Cox, Senior Principal, Tompkins International
Analyst Insight: The worldwide logistics market has experienced a growth rate of approximately 7 percent annually, which is notable given logistics costs average about 12 percent of total revenues globally. Of this total, an average of 46 percent is spent through outsourced relationships, which drove total spend in North America alone to $134bn in 2011. Given this growth and the increasing complexities of global trade, selecting the appropriate services to outsource and structure mutually beneficial relationships with logistics providers is critical. - Aaron Pernat, Senior Manager, and Gary Allen, Executive Director, both in Ernst & Young's Supply Chain Advisory Practice