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Publisher Description

In business and industry, it seems we have reached a tipping point. A pundit in the US has suggested that this is all to do with the 'rule of three'--the idea that a maximum of three giant, global players will come to dominate most industries. Whether this is true or not, it is beyond dispute that the balance of power has shifted from suppliers to their customers. The top 500 retailers and manufacturers in the world have got larger, and their leverage and buying power have increased accordingly. Suppliers find themselves having to dance to the customer's increasingly complex tune. Across sectors as diverse as automotive and retail, this elite group of very large customers is looking to their supply chains to help protect and extend their current positions of market strength. More and more of these super-customers are adopting highly customized supply chain models. For example, they are demanding customized SKUs, putting in place more complex replenishment models and employing a bewildering range of shipping, logistics and warehousing models. Their suppliers have no option but to respond to these requests as best they can. This trend is brought into sharp focus in a major recent piece of research from SCM World, sponsored by GXS and led by Martin Christopher, Emeritus Professor of Marketing and Logistics at the Cranfield School of Management. More than 800 supply chain professionals took part and they spanned a broad range of industry sectors--with more than a third of the participants coming from Europe. The headline finding is emphatically clear: customization is king and the era of the standardized, 'one size fits all' supply chain model is fast disappearing. It seems to be a recent change as three out of every four participants agreed that the number of requests from large customers for new or customized supply chain processes have become marked during the past 3 years. The list quickly grew forbiddingly long. As examples of the processes that they have been asked to implement, respondents mentioned vendor managed inventory and supplier managed inventory, collaborative forecasting, drop ship, self-billing, e-RFQ and wire transfers. There were new demands in the logistics and warehousing arena, including mixed pallets, floor ready merchandise, cross-docking, postponement and late-stage configuration, direct store delivery, direct to consumer, drop ship to business, drop ship to consumer and other variants. Replenishment might take the form of 'traditional' order management but is just as likely to be consignment, justin-time, call-off, schedule assignment or scan-based trading. There are new initiatives in supply chain finance and corporate social responsibility.

Business & Personal Finance
1 November
Via Media Ltd.
The Gale Group, Inc., a Delaware corporation and an affiliate of Cengage Learning, Inc.

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