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GT Nexus

Doing More at the Source to Keep Up with the Retail Revolution
Bryan Nella, GT Nexus

Today's retail supply chain is caught in a vice grip between cost crunching and consumer demand. Improving speed and lowering costs without sacrificing quality or customer service is a challenge. Doing more at the source is a strategy that can help retailers become more agile and adaptable to consumer demand, while reducing costs in the supply chain.

The price for implementing change in the production lifecycle is at its lowest when done at the factory level. By deploying change at source, the impact on cost and agility is maximized. Initiatives that remove time and cost from the cycle - such as customization of goods, generation of store-ready merchandise, providing flexible pack strategies, preparing shipments for direct ship or crossdock - can all be done at the factory level; doing so makes the supply chain more agile and transparent. Finding ways to do more at the source and capturing actionable inventory intelligence is a major priority for injecting responsiveness into the omni-channel retail supply chain.

A few examples:

  • An athletic footwear company allows consumers to go online and design their own custom shoes. The specs are sent directly to a factory overseas along with shipping information. The custom sneakers are created, packed, and shipped direct to the end consumer.
  • A sports equipment brand allows consumers to order individual custom hockey sticks personalized with their name and number from its website. The website sends orders to the internal system and then feeds automatically to the manufacturer. The factory puts the name and number on the stick, item scans it, creates a packing manifest for one stick, labels it, and ships it out via UPS directly to the consumer.
  • A retailer responds to an early season rush on summer shorts by assessing all inventory across the entire supply chain and identifies shorts that are available to expedite. It air-ships finished shorts from three facilities to its retail locations where goods are selling fast due to early hot weather.

This type of speed and agility directly meets some of the challenges posed by today's demanding consumer.

Another opportunity to generate value at source is deployment of RFID. In-store benefits have been well established but there's room to significantly expand RFID ROI by tagging at source to improve compliance, visibility, and transparency. RFID at factory can improve packing accuracy, reduce concealed shortages, and eliminate the need for buffer stock. Improving shipment accuracy can also support item-level proof of delivery, translating into new capabilities in available-to-promise commitments. It also provides a certified chain of custody.

Doing more at source means doing less domestically. The opportunity to eliminate distribution centers and domestic inventory costs is significant. The ability to be more agile with goods earlier in the supply chain is a big win. Visibility into inventory available to promise earlier in the chain supports omni-channel retail demands. The cost is clearly cheaper - and the benefits are richer - to implementing change at the source. As retailers race to make adjustments to keep up in the fast evolving omni-channel world, a good place to begin is at the source.


Bryan Nella is Director of Corporate Communications at GT Nexus, the world's largest cloud-based supply chain network. He has more than 12 years of experience distilling complex solutions into simplified concepts within the enterprise software and extra-enterprise software space. Prior to joining GT Nexus, Bryan held numerous positions in the technology practice at global public relations agency Burson-Marsteller, where he delivered media relations and communications services to clients such as SAP. In previous roles he has worked with clients such as IBM, MasterCard and U.S. Trust. Bryan holds a BA in Mass Communications from Iona College and a MS in Management Communications from Manhattanville College.

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