Supply Chain Technology Provides Competitive Advantage for Retailers
C2FO’s inaugural Retail Pulse survey shows that retailers are increasingly adopting supply chain technology to streamline their operations and remain competitive. In fact, 74 percent of top procurement retail executives said the use of new technologies in this space can provide a significant competitive advantage.
Supply Chain Software Enhances Growth
Conducted at the recent Retail Industry Leaders Association’s Retail Supply Chain Conference, the C2FO survey includes responses from supply chain executives in the areas of distribution, e-commerce, omnichannel, sourcing and domestic transportation.
“Supply chain technology — such as supplier collaboration enhancement and trade finance solutions — can provide efficiency to existing operations, streamline inventory and increase revenue,” the study states. Furthermore, 62 percent of the retailers surveyed believe their organizations are agile when it comes embracing these new technologies, while 88 percent prioritize improving margins.
“The results of the survey show continued pressures to improve margins,” Sean Van Gundy, C2FO’s managing director for working capital advisory, said in a statement. “It is now more important than ever for retailers to consider cost-effective solutions that improve supply chain health, gross margins and drive bottom-line growth.”
Moreover, innovation along with agility may be an integral factor in helping businesses stay competitive.
“This data proves what we’ve seen in the market since 2010 when we started working with the world’s largest retailers to help drive bottom line growth through their supply chains,” said Sanjay Gupta, C2FO’s chief operating officer. “With margin pressures impacting retailers, executives understand that innovation and agility go hand in hand; only those who embrace new technologies and solutions will remain competitive.”
Barriers to Adoption
The C2FO survey shows budget limitations, cited by 53 percent of the respondents, as the main barrier to supply chain technology adoption. Resource constraints and stakeholder buy-in follow, with 46 percent and 35 percent of respondents respectively. Furthermore, although the survey indicates a positive opinion on organizational agility among procurement executives, 37 percent say that their organizations are “not very agile” or “not at all agile” in adopting supply chain technologies.
Additional challenges include managing supplier costs, with more than half of retail executives (53 percent) citing price negotiation as their top challenge, followed by margin improvement (48 percent) and price transparency (37 percent).
To remain competitive in the year ahead, 43 percent of respondents are planning investments in supplier collaboration enhancements. Other investments involve logistics technology (71 percent), analytics services (64 percent) and risk mitigation (20 percent).
In light of these statistics, retailers should assess their IT supply chain investments to ensure they have the proper technology to make informed decisions, streamline procurement and stand strong against the competition.