Increasing customer expectations, competitive marketplace, supply chain complexity, globalization and an evolving technology landscape are some of the challenges faced by the retail industry.

Retail is a multi-faceted industry with market segments that have different business needs and service requirements. The industry is the consumer-facing end of the supply chain and the supplier-facing end of the demand chain and the retail operation centers that serve as the integration points for the two chains.

The situation

Customer expectations: globally, consumers are becoming more demanding. They expect, and get, higher levels of service
Competition: creation of retail opportunities far outweighs growth in consumer demand. Revenue and profitability are shifting towards larger retailers
Commoditization and lack of differentiation: while the number of products and services is increasing, there is little differentiation
Evolution and acceptance of technology: the adoption of technology in all facets of retailing from supplier to consumer due to technological advances and cost reductions has further narrowed the differentiators between retailers

The challenges

Enhance and streamline supply chain
Improve operational efficiencies
Create differential advantage
New Business Strategies:

Globalization: growth through global acquisitions and sourcing from strategic locations.
Consolidation: rationalizing non-performing stores, warehouses, merchandise, suppliers and partners.
Differentiation: New store-formats, multi-channel retailing, enhancing in-store experiences, pricing strategies, improved merchandise assortments.

Supporting Technologies

Collaboration: facilitating information sharing and managing procurement and logistics.
Optimization: develop applications that can apply complex algorithms and analytics to data from multiple functional areas.
Automation: Automate store, warehouse, distribution centers and enterprise processes.

The shift in the retail model