A Retail Revolution

Consider Wal-Mart, who uses Retail Link, a software system that provides vendors with up-to-date access to point-of-sale price and volume information and highlights Wal-Marts inventory positions and forecast of future needs. As a result, Wal-Mart improves fill-rate and customer satisfaction. Implemented in 1991 as a closed network only for large suppliers, Wal-Mart transferred the system to the Internet in 1997. Retail Link now processes tens of thousands of supplier queries per week. The fact that Wal-Mart is the worlds largest retailer brings natural advantages to the job of e-retailing management. Michel Lapierre, president of Claudel Lingerie, a Montreal manufacturer of womens apparel echoed the success of e-retailing We dont have to wait to find out whats selling... Our designers know what our customers are looking for, and they can create new designs based on his information. No prize for guessing the impact of this innovative approach on Claudels sales. Within two years its top-line grows by 100 per cent! Nygord International, a manufacturer and retailer of womens fashion lines with global sales well over US$ 300 million annually, also follows the trend. Nygord runs an automatic reorder sales system. Called ARTS2, it links all Nygord stores and retail accounts, with each sale of pre-selected staple items, such as pants, reorder forms are instantly filed on computer. Once or twice a week, a bundle of these reorders is flashed electronically to the Nygord central plant. A kind of high-tech workshop for womens wear, the center fills new orders for Nygord brand labels in a day. As clothes are shipped out of the plant, replacements are already being manufactured. Same for Sears, the celebrated retailer. In a similar fashion, information about sales are collected daily from all stores through electronic linkages and contained in the sales data warehouse. Using this information, Searss buying staff can quickly learn if a particular raincoat along with its colour, size, and style is selling well in one store or region. Further, it permits suppliers to compare sales among stores or regions and estimates needs for future buying. Todays apparel customers are significantly reducing their supplier bases, providing the opportunity for the most capable suppliers to seize huge market share. The win factor in gaining these new avenues is a new business model built around inter-company supply chain innovation. E-retailing is certainly the new entry to apparel business paradigm, pushing the business frontier closer to actual consumer.

About the Author:

The author is senior supply chain professional with experience in leading multinationals like Arvind, Raymond and KDS group. He is currently with KDS Group, Bangladesh as vice president, supply chain & operation for its accessory business.

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