Another complication is the unpredictability of local markets, since what might be "hot" or “cool” in one area may not sell at all in another market. If the retail outlet guesses wrongly on a fashion piece, or if it takes too long to get items into the stores (resulting in the merchandise being considered passé by the consumer), the stock must be moved to the deeply discounted (marked down) sales racks. At best, the retail chain is wasting expensive floor space on items with little or no profit margin; at worst, the items will have to be discarded or transported to other resellers. Profit margins are tight on some lines, since price points (the price at which the young shopper with limited finances shrugs and goes somewhere cheaper to shop) dictate aggressive pricing. In spite of these challenges, competition is growing for this customer segment, and it is becoming more difficult to distinguish the value that the retailer is delivering and to remain profitable.
As depicted in the typical sequence of processes listed above, retail personnel spend up to 80 percent of their time on administrative tasks rather than on their primary job. One could only imagine the mayhem that would result should there be virtually no integration among the above processes and its participants, or even between their core business systems, given that each task has its own Microsoft Excel, Microsoft Word, or e-mail trail, with data in isolated and disparate systems. If the above processes are still heavily segregated, with no visibility and very little control, the overall process becomes painfully slow and inaccurate, with extended processing times as a result.
Eqos cites that one major retailer calculated that it took 48,000 spreadsheets to launch just one new product line, which means lots of dreaded manual processing, re-keying, data conflicts, extended processing times, and so on. Further, nowadays, a vast majority of retailers manage inbound logistics processes across a variety of in-house enterprise resource planning (ERP) and supply chain management (SCM) systems, supplier data bases, and outsourced logistics providers' systems. They do this in an environment where it is difficult, if not impossible, to have a single view (version of the truth) of the entire sourcing and delivery process from a single vantage point.
In a more sophisticated scenario, though, all the members of the supply chain communicate through a coherent Web-based system. This means that when, for example, a vendor makes a change in the status of a product, everyone in the supply chain instantly sees the change. The key in global sourcing today is to minimize the overall cycle as well as disruptions, and the most effective way to do this is to have live, accurate, and immediate information available to all parties of the supply chain. New Internet-native sourcing software applications give users visibility of current product or order status at any point in time, anywhere in the world. These applications eliminate almost all duplication of information, thereby allowing all trading parties to collaborate on more rewarding issues rather than having to constantly put out fires.
Prior to implementing a contemporary Web-based automated solution, contacting multiple vendors at once for pricing was a tedious manual process for the sourcing group. In contrast, by using a Web-enabled infrastructure, user enterprises should be able to better integrate globally with their supply bases and broaden the scope of vendors they can locate
Lately, such technology has streamlined many retail firms' ability to obtain estimated pricing from several vendors simultaneously. Also, when the design team comes up with a new fashion concept and wants a sample of that concept, such a system allows information on the design to flow into the sourcing organization. This allows the sourcing team to acquire estimated costs as well as time-and-action (that is, normalized or synchronized calendars within the entire production cycle) information. The sourcing team can then better determine where it may want to place the production, depending on volume, possibly integrating with the merchant organization to give it a feel for how much product the firm will be sourcing of a given style so that it can review capacity constraints.
The next step is to use the software tools to break style data down by more variables in preparation for placing the purchase or production order. For instance, the software could provide suppliers with answers to questions such as the following: How much does the retailer want to order by color and by size? What is the final pricing? What is the final time-and-action calendar?
More and more, the standard order confirmation and customary ASN procurement practices cannot provide enough of a guarantee that everything is going smoothly with any order placed. This is particularly true of the internationally sourced, custom-made purchases that are common in the consumer goods manufacturing and distribution industries. Here, the difficulties of communicating across time zones as well as long lead times make for lengthy recuperation periods (if recuperation is even possible) when problems occur. That is why buyers benefit from visibility and supply chain event management (SCEM) systems that inform and alert them to the following production scenarios: orders were (not) started on time; orders were (not) placed on the boat on schedule; the design team has changed (yet again) specs on the color or fabric for a particular planned merchandise; and the order was (not) properly documented to clear customs without a glitch.
As depicted in the typical sequence of processes listed above, retail personnel spend up to 80 percent of their time on administrative tasks rather than on their primary job. One could only imagine the mayhem that would result should there be virtually no integration among the above processes and its participants, or even between their core business systems, given that each task has its own Microsoft Excel, Microsoft Word, or e-mail trail, with data in isolated and disparate systems. If the above processes are still heavily segregated, with no visibility and very little control, the overall process becomes painfully slow and inaccurate, with extended processing times as a result.
Eqos cites that one major retailer calculated that it took 48,000 spreadsheets to launch just one new product line, which means lots of dreaded manual processing, re-keying, data conflicts, extended processing times, and so on. Further, nowadays, a vast majority of retailers manage inbound logistics processes across a variety of in-house enterprise resource planning (ERP) and supply chain management (SCM) systems, supplier data bases, and outsourced logistics providers' systems. They do this in an environment where it is difficult, if not impossible, to have a single view (version of the truth) of the entire sourcing and delivery process from a single vantage point.
In a more sophisticated scenario, though, all the members of the supply chain communicate through a coherent Web-based system. This means that when, for example, a vendor makes a change in the status of a product, everyone in the supply chain instantly sees the change. The key in global sourcing today is to minimize the overall cycle as well as disruptions, and the most effective way to do this is to have live, accurate, and immediate information available to all parties of the supply chain. New Internet-native sourcing software applications give users visibility of current product or order status at any point in time, anywhere in the world. These applications eliminate almost all duplication of information, thereby allowing all trading parties to collaborate on more rewarding issues rather than having to constantly put out fires.
Prior to implementing a contemporary Web-based automated solution, contacting multiple vendors at once for pricing was a tedious manual process for the sourcing group. In contrast, by using a Web-enabled infrastructure, user enterprises should be able to better integrate globally with their supply bases and broaden the scope of vendors they can locate
Lately, such technology has streamlined many retail firms' ability to obtain estimated pricing from several vendors simultaneously. Also, when the design team comes up with a new fashion concept and wants a sample of that concept, such a system allows information on the design to flow into the sourcing organization. This allows the sourcing team to acquire estimated costs as well as time-and-action (that is, normalized or synchronized calendars within the entire production cycle) information. The sourcing team can then better determine where it may want to place the production, depending on volume, possibly integrating with the merchant organization to give it a feel for how much product the firm will be sourcing of a given style so that it can review capacity constraints.
The next step is to use the software tools to break style data down by more variables in preparation for placing the purchase or production order. For instance, the software could provide suppliers with answers to questions such as the following: How much does the retailer want to order by color and by size? What is the final pricing? What is the final time-and-action calendar?
More and more, the standard order confirmation and customary ASN procurement practices cannot provide enough of a guarantee that everything is going smoothly with any order placed. This is particularly true of the internationally sourced, custom-made purchases that are common in the consumer goods manufacturing and distribution industries. Here, the difficulties of communicating across time zones as well as long lead times make for lengthy recuperation periods (if recuperation is even possible) when problems occur. That is why buyers benefit from visibility and supply chain event management (SCEM) systems that inform and alert them to the following production scenarios: orders were (not) started on time; orders were (not) placed on the boat on schedule; the design team has changed (yet again) specs on the color or fabric for a particular planned merchandise; and the order was (not) properly documented to clear customs without a glitch.
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