Transforming the Retail Supply Chain: The Art of the Pass

 

 

 

 

 

 

Hockey and soccer are true team sports. With a few rare exceptions, every goal that is scored is a result of a chain of events in which every member of the team played a part. The player who scores the goal may celebrate a little more exuberantly, but they really only represent the final split second in the chain of events.

Anyone who has learned to play these sports at the competitive level will tell you that, from very early on, coaches heavily emphasize passing, not shooting. After all, without the proper chain of events leading up to the goal, there is no goal.

Whether you play hockey or soccer, you need to know two things – where your teammates ARE and where they are GOING TO BE. The secret to making a good pass is to use the same rule that’s used by quarterbacks in football: pass to where the receiver is GOING TO BE, not where he IS.

In the past we’ve talked about how recent advances in RFID and real time data sharing have given supply chain planners unprecedented information about where the product IS. But before product can be “passed” to each of the stores, they first need to figure out what their inventory position is GOING TO BE over the next several days (or weeks).

Because of lead-time and other constraints, you can’t wait until the “real time” information is telling you that you’re low on stock. By then it’s too late – the pass has gone behind the receiver.

That’s why retailers won’t be able to make drastic, sustained and across-the-board
reductions in retail out-of-stocks with RFID initiatives and transactional data sharing. The retailers who excel in the future will be the ones who put the processes in place that will anticipate each and every sale and model the chain reaction of flows all the way back
through the supply chain.

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