Retail supply chain planners slow to introduce supporting software, with Excel top application
Despite need for advanced planning solutions and forecasting capabilities, Excel is easily the top software used in the retail supply chain
Although the supply chain has the potential to become a key differentiator in the competitiveness of a retailer, and a widespread perception of benefits, there appears to be far too little impetus to innovate and adopt new systems that can exponentially improve efficiencies in the planning process, finds the 2020 State of Retail Supply Chain Report, which can be downloaded for free here.
This can be seen in the current state of planning solutions deployed by retailers and manufacturers. By far and away the most used planning solution for supply chain professionals in retail and manufacturing is Excel, with 61.5% saying they use the software. While clearly Excel has a wide number of useful functions and is extremely widely understood, deployed and used, it is disheartening to see it being the default technology rather than a supporting actor, which can supplement other technologies.
This is followed by warehouse management software (55.1%), but this is a rare standout of majority adoption of a key technology, as all subsequent technologies we asked about in our survey had been adopted by less than half of retailers and manufacturers.
These results are all the more surprising, as the greatest concern among the retail supply chain is forecasting. Although 30.8% of retailers and manufacturers said that forecasting was their single greatest challenge, just 32.1% - less than a third – said that they have implemented this technology. The same percentage also say that they use inventory planning software and a transport management system.
This technological lag means that efficiency is being impaired, as utilising Excel as the primary planning system leads to inherent inefficiencies in compiling reports and running analysis, with more room for human error. By the time retailers understand what is happening in their supply chains, it can often be too late.
It can therefore be of no surprise that not a single retailer or manufacturer that replied to our survey thought their supply chain and its planning was extremely efficient. Just 22% said that they were achieving good efficiency in their supply chain and the majority – 61% – felt that they were efficient enough for day-to-day operations but nothing more. 17% said that they were quite or very inefficient.
The retail supply chain needs to move towards a more technologically advanced set of platforms that allow it to be dynamic: Dynamic in generating and analyzing real-time data; dynamically generating the best routes to match the situation, available transportation and end-point; dynamic in its ability to source components or products from different suppliers to spread risk; and dynamically forecasting demand.