A recent episode of the ITV documentary, ‘Bargain Fever Britain’, went behind the scenes of key retailers as they battle to meet intense demand for discounted goods sales throughout the year. Consumer demand for lower prices has created a more challenging environment for retailers who in turn need to rely on agile suppliers that can closely anticipate the volume and type of goods they will need.
Meeting more spontaneous demand for higher quantities of inventory is therefore about more than being reactive. Those vendors that understand the dynamics of their retail customers – through direct sector experience and efforts to maintain strong relationships – are better positioned to forecast requirements, as well as responding to last minute needs. Furthermore, fragmented supply chain efforts can seriously hamper a retailer’s ability to satisfy customer needs, so suppliers that offer a consolidated and varied package of products and services usually win the day.
From a systems and technology point of view, it is vital that vendors have intelligent inventory control processes in place that provide an alert when a retailer’s stock levels are likely to be running low. This should be complemented by suppliers buying in additional stock to allow for last minute demand during sales periods. However, being able to react in this way successfully relies on a close and open relationship between the two parties as this allows for notifying suppliers about sales periods in plenty of advance – mitigating the ‘last minute’ nature of retailers’ needs in the process. Of course, sales can take place unexpectedly, so having the capability to deliver in this instance is equally important. As well as ensuring stock levels meet demand, some consolidated suppliers stock essential sales materials such as till roll and point of purchase goods that are needed to support a sale.
Of course, vendors seeking to become long-term business partners to the retail sector can offer far more than the mere provision of products and services. By working with suppliers that understand the retail sector through direct experience, retailers can benefit from a host of advice and consultation on how to drive customer appeal and footfall. For example, this could cover store layout, in store technology or sales strategy, to name but a few.
Bargain Fever Britain is certainly here to stay and acts as a timely reminder to the wider retail sector about how to go about sourcing supplies and what the right vendor should be offering. The level of competition to supply to the retail sector has never been more intense so now is not the time to be complacent – only those suppliers that concentrate on developing pro-active, highly tactical relationships with retail customers will last the course.
Nigel Crunden, business specialist at Office Depot