Written by Mark Hudson
In today’s competitive retail industry bankruptcies and store closures dominate the daily news, “retail apocalypse” is a common term, and retailers and brands face myriad pains and issues just to survive. Complicating matters further, global retail sourcing is incredibly complex, with multiple steps, processes and milestones involved from a product concept or planning stage to the point of product delivery and sale to the customer.
In order for new competitive strategies to work, retailers need to ensure that their supply chains are fully optimized with built-in visibility, collaboration and efficiency. As the number of private label SKUs sourced increases, numerous functional areas in different countries need to collaborate and plan to respond to change effectively.
At the 11th annual Retail Global Sourcing Day event in Hong Kong in late November, attendees learned best practices from retail industry insiders and took home ideas to spark and ignite change, as well as be able to help others prepare, adopt and embrace that change. The annual sourcing event brought together more than 150 supply chain, product development, sourcing and quality executives of major and fast-growing retailers, brands, CPG and service provider companies, all being brought together for one common goal: “Prepare for Change.”
Key industry takeaways
One widely talked about topic was the importance of customs in the global supply chain–it’s critical to understand what customs duties were paid before the tariffs and what duties are paid now. There is a cost to the trade war and if you don’t understand it, as much as 40 percent of your margin could be lost.
Other apparent themes among the speakers at Global Sourcing Day was the need for retailers to do more in the industry: it needs to be faster and it needs to be better.
But how does an entire industry do more, faster and better, when 70 percent of retail companies are expected to take on an enormous upheaval and shift sourcing operations in the next three to five years?
The answer might just have emerged at this year’s event, by way of the TradeBeyond announcement. TradeBeyond is not another finished goods online marketplace, rather, it is the exclusive network in which retailers, brands, validated suppliers and factories can connect, source, extend innovation and bring private label products to market faster. TradeBeyond allows members to work “virtually,” in real time, side-by-side, seamlessly and will ultimately revolutionize how the retail industry manages product development and product sourcing for own brands.
Perhaps the preparation started at last year’s Global Sourcing Day, and in the very near future we will see the industry as a whole willing to step up and be true game changers. Game changers who innovate beyond the accepted and have the vision to invest in and execute on implementing a real change through innovative platforms such as TradeBeyond.
Published in the Sourcing Journal February 8, 2019