Executive Briefings

Omnichannel Success Depends on Re-tooling the Consumer Goods, Retail Supply Chains, Report Says

Omnichannel represents the biggest growth opportunity for the consumer goods and retail industry, according to a report from EY and the Consumer Goods Forum.

Although 74 percent of senior supply chain professionals surveyed think store-based sales will continue to dominate in the next five years, 88 percent believe that consumer goods firms can no longer rely on traditional sales channels to drive growth, according to the report entitled Re-engineering the Supply Chain for the Omnichannel of Tomorrow.

Annual global store-based growth is forecast to be just 5 percent between 2014 and 2019, compared to online growth of 15 percent. In emerging markets, the gap between store-based and online growth will be even greater.

Omnichannel has placed supply chain firmly on the front line. With consumers now expecting to browse, purchase and return goods across a variety of channels, the supply chain has to reach beyond the retail store to the consumer’s home and dedicated pick-up points. This requires real-time, channel-agnostic visibility of inventory across the supply chain and a single view of the consumer as they hop from one channel to another.

Fulfilling the omnichannel promise will require significant organizational transformation. Building an omnichannel capability cannot be an afterthought. To succeed, companies must embed omnichannel into their strategy, transform their supply chain to be truly agile and responsive, and build robust data and analytics capabilities.

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Although 74 percent of senior supply chain professionals surveyed think store-based sales will continue to dominate in the next five years, 88 percent believe that consumer goods firms can no longer rely on traditional sales channels to drive growth, according to the report entitled Re-engineering the Supply Chain for the Omnichannel of Tomorrow.

Annual global store-based growth is forecast to be just 5 percent between 2014 and 2019, compared to online growth of 15 percent. In emerging markets, the gap between store-based and online growth will be even greater.

Omnichannel has placed supply chain firmly on the front line. With consumers now expecting to browse, purchase and return goods across a variety of channels, the supply chain has to reach beyond the retail store to the consumer’s home and dedicated pick-up points. This requires real-time, channel-agnostic visibility of inventory across the supply chain and a single view of the consumer as they hop from one channel to another.

Fulfilling the omnichannel promise will require significant organizational transformation. Building an omnichannel capability cannot be an afterthought. To succeed, companies must embed omnichannel into their strategy, transform their supply chain to be truly agile and responsive, and build robust data and analytics capabilities.

Read Full Article