Updated: Jun 24, 2022
With the economic headwinds of higher fuel and labour costs biting, retailers are seeking out new ways to drive down costs and streamline their supply chains. Removing friction and unlocking data driven insights is key.
According to a recent BCI supply chain resilience report 69% of companies do not have complete visibility of their supply chains.
Even within the highly developed UK grocery retail sector, hand offs between logistics teams, distributions centres and stores can be clunky. Leading to unnecessary delays, poor availability, and inefficient operations.
While every link in a retail supply chain works hard to optimise their individual bit, it’s often without the ability to share the insight or benefit with others in the network or ecosystem. This allows inefficiencies to creep in.
The daily demands of ‘just-in-time’ deliveries also inevitably create stress points in the system. To maintain effective, lean operations companies must have the ability to plan and adapt dynamically in the face of unexpected events. Information needs to flow smoothly across the supply chain network, so everyone can accurately track and monitor the goods they’re relying on. What’s needed is supply chain resilience which allows manufacturers and processors to maintain production schedules when issues arise. And it’s not just about their supply for retailers, to control their costs they must minimise downtime, avoid any ‘on-time in full’ (OTIF) penalties for missed shipments, and retain the good will of their customers.
But the reality is that sharing valuable data and insight among different entities in most supply chains is fraught with practical difficulties. There’s rarely very little incentive for different organisations to change their existing ways of working or open up their systems to others in the chain.
It’s an area where technology can bring huge benefits, and Atamai Freight is a great example of the value of introducing digital innovation into the supply chain. With the development of a community empowered platform, Atamai is helping to shift that paradigm and unlock a new set of efficiencies within a sector worth £205bn annually.
Atamai allows previously ‘locked down data’ across an entire supply network to be surfaced. Previously it would otherwise be unavailable - either because it was not captured consistently, or it was contained and held within one silo of the chain.
Unlocking the value of each other’s data is key
In a retailer alone, there are multiple stakeholder groups, each with different objectives. The supply teams’ role is to order the right stock to arrive in the right place at the right time. They’re tasked with minimising stockholding and working within the constraints of the distribution centre’s capacity to receive, pick and store stock.
Distribution centres on the other hand are tasked with processing and holding the stock, so their aim is to do so at the lowest possible cost. They want to minimise double handling, what they like to call ‘one way stock’, helping them optimise their labour effectively.
Finally, the transport and logistics teams are responsible for the movement of goods from a retailer’s distribution centre to the stores themselves. They are focused on hitting pre-arranged time slots, whilst maximising the utilisation of their fleet of vehicles and drivers.
Traditionally the transport aspect of the supply chain into stores was the preserve of a retailer’s own fleet management. But as this is increasingly being outsourced the need for real-time collaboration and visibility across the supply chain is even more important.
Just in case
Visibility of product arrival is crucial to supply teams to enable them to dedicate store space. This is especially true for perishables and short-lived seasonal products. A vehicle missing its allotted window requires fast contingency planning to fill the space and ensure sales are protected with substitute products.
The recent volatility of global supply chains also means many retailers have sought to create additional buffer stock, forcing them to move from a philosophy of ‘just in time’ to ‘just in case’.
By creating visibility and real-time location of all these loads there is an opportunity to reduce inventory or buffer stock, which can also help to reduce costs.
Meanwhile for distribution centres, greater visibility means they can ensure their people are in the right place at the right time - whether that’s unloading or in utilising pick grids to allocate the incoming stock into store specific lanes.
Distribution centres are notoriously tight on capacity and high in labour and cost. Supply chain experts estimate between 10-20% of grid capacity is wasted by vehicles not hitting agreed windows inbound, with associated knock-on effects. The scheduling of a vehicle’s arrival into inbound bays and the allocation of staff to deal with the stock is critical to efficiency. Get it wrong and people are left waiting, trucks sit idle and, worse still, products are delayed reaching stores impacting on shelf availability, hitting sales.
Unlocking fast twitch
Atamai helps unlock a ‘fast twitch’ reaction to enable better scheduling of inbound / outbound bays and manage internal staffing levels. Transport and logistics teams, responsible for moving goods, also benefit from the ability to plan availability of outbound loads more closely. During the pilot, customer feedback highlighted the value of being able to plan resources and production more effectively by tracking shipments in real-time from collection to delivery. Having goods cleared forward helped prevent production delays and increased confidence in their cold chain integrity. A streamlined logistics operation also helped reduce both food miles and carbon footprint.
It’s a great example of what digital innovation like Atamai Freight can bring to the supply chain. With true integration to unlock the value of data, the entire ecosystem from producer, to manufacturer, to retailer gain the ability to share critical information in a secure and trusted manner, releasing immediate benefits such as the scheduling of staff at receiving depots, ensuring drivers are arriving in the pre-agreed slots. And if things go wrong, such as a lorry missing a ferry, contingency measures can be put in place immediately to minimise disruption.
If you’d like to discuss the challenges in your supply chain – whether you’re a manufacturer, retailer or haulier serving your customers – then please get in touch. Technologies like those within Atamai Freight can help you visualise and respond in real time to what’s happening in your supply chains, increasing operational efficiency.