The Retailer Spring Edition 2022

THE RE TA I L ER

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DRIVING INNOVATION IN THE RETAIL SECTOR: STREAMLINING THE SUPPLY CHAIN

Ali Rezvan Retail Director Microsoft UK

T echnology is the key to From the impact of ongoing bottlenecks caused by Covid-19 and the raft of changes to EU/UK trading regulations as a result of Brexit, to the energy crisis and inflation, never before have retailers faced such a huge level of disruption to their supply chains as they have during the last two years. These challenges have affected all corners of the retail industry, from initial stages and materials sourcing to partnerships and final mile delivery. The challenges of the last few years have also put a spotlight on retailers’ reliance on single suppliers and single country supply routes for many organisations, which has forced many retail sector companies to rethink their net works and consider supplier diversification to ensure continuity in their supply chain. Alongside this, it’s also vital that businesses innovate their supply chain processes and look for ways to utilise data technologies to gather invaluable insights, which they can use to pre pare for a more sustainable future. Retailers must innovate, seeking advanced technologies to transform their supply chain from purely that of an operations hub, into the epicentre of business. Technologies including AI, machine learning and cloud offer retailers the insight they need to build resiliency into their supply chains – one that bakes in busi ness continuity and streamlines operations, to prepare them for the challenges of the future. Anticipating shifting demands and trends with precision is one of the best ways to succeed in a challenging, fast-moving retail landscape. That said, in the new world of hybrid work and e-commerce, retailers must almost move away from everything they used to knowabout historic patterns of consumer behaviour and towards an informed, investigative model, where data drives decisions and promotes agility. creating a fully agile and future-proof supply chain Innovation provides invaluable insight

Advanced analytics and real-time data led insights can ensure that a retail business is making informed decisions at any moment. There are hidden insights buried in supply chain operations that have enormous power to drive new standards in efficiency and sustainability, as well as aid with scenario planning. Visibility is crucial, and the only way to achieve true agility, by enabling businesses to spot problems before they occur, coupled with end-to-end transparency. The real-time insights and operational over views that cloud-based systems can offer can be transformational to the running of a retail business. Rather than continuing to simply react to change, businesses can proactively arm themselves with the tools to unify data and receive predictive insights fromAI and IoT across their operations. From planning and procurement, order fulfilment, production and stock to warehousing and transportation, operational efficiency, product quality and profitability can be boosted with the use of the right technology. Alongside the ongoing impact of the pandemic, there is an additional challenge facing retail ers that they cannot afford to ignore. Climate change and the pressing need for supply chains to become more sustainable is an important factor that all retail businesses must address. Consumers are increasingly demanding cli mate-conscious goods and are engaged farmore than ever beforewith the subject ofwhere their purchases originate from. Alongside the post Brexit transition period during which trade is less frictionless than it once was with Europe, many organisations are looking at ways to simplify and even shrink their supply chains in an effort to move towards a more adaptable business model. Retailers are more aware than ever of how important sustainability is to their customer, but despite this, only 40 per cent of UK retailers are yet to apply environmental standards in their supply chain. Gaining a greater under standing of a business’ in-motion operations can allow retailers to spot opportunities to Driving up environmental standards

make improvements. For example, they could look at how to introduce recycling, repair or refurbishment into their supply chain and low carbon transport and logistics options, aswell as collaboratingwith other suppliers and retailers to promote greener attitudes towards purchas ing and waste among their consumers. Furthermore, retailers can also utilise technol ogies to digitise their value chain and build a connected data strategy for monitoring their emissions, waste and energy usage throughout their operations. This is particularly poignant as energy prices increase and pressure is added to profit margins, meaning any steps taken now to reduce emissions and boost sustainabilitywill likely be considered a wise business decision. Reacting quickly to any scenario There were many examples during the pan demic of certain goods surging in popularity, for example bicycles and desk chairs as the workforce began working remotely and travel ling in confined spaces came became high-risk. Those businesses that were able to react to these consumer trends quickly, saw their profits jump as a result. Supply chain management tools such as Microsoft Dynamics 365 arms organisations with the insights they need to make rapid, intelligent and data-backed decisions in a challenging market. Whether retailers need to shift their stock around, make changes to where it’s held and scale up with any growth patterns they experience, delivering stock to the right place at the right time to keep upwith customer demand is still the number one goal. Becoming a truly agile and streamlined business is only possible bymaking use of the advanced analytics and real-time data-led insights that technology can provide.

Ali Rezvan ali.rezvan@microsoft.com