Retailers need to source and sell multiple product categories across multiple markets and geographies to maintain supply and revenue growth. But can they do it efficiently?
Retail is operating at the height of globalization, and this internationally integrated marketplace presents a wealth of opportunities for new customers and revenue streams. However, it also makes retail operations a lot more complicated.
Right now, it’s expected that the world’s top retailers must source and sell multiple product categories across multiple markets and geographies through multiple channels to keep pace with increasingly ambitious revenue and growth goals.
But meeting customer demand and expanding market presence across multiple categories and markets is not the competitive differentiator it once was. All the major players are already doing it. The real opportunity for competitive differentiation today lies in the way retailers manage these multiples to bring the right products to the right markets, aggregate buying power and de-duplicate processes.
Fostering a high level of organizational transparency, efficiency and agility will be especially important as retail business models continue to evolve to support sustainability and omnichannel sales.
Overcoming multi-market complexity
There are many factors that make managing multiples extremely difficult. Chief among these is the use of disparate enterprise systems and processes.
The innumerable different systems and processes retailers and their sourcing partners must use on a daily basis increase administrative overhead, exacerbate operating expenses, inhibit aggregated buying, and make true alignment and collaboration with both internal and external partners much more challenging.
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Retail organizations use a variety of systems to oversee sourcing for different types of goods across product categories, geographies—both domestic and international—and product development processes, including design, co-design and market buy, among others.
The different systems retailers, their internal teams, and their external partners use across processes result in a labyrinthian tangle of data and communication silos.
External partners may not be able to easily exchange data, causing duplicative administrative work and miscommunications. Sourcing teams may use different interfaces and purchase order systems for international and domestic markets, bifurcating buying and lowering margins.
Disparate systems slow and divide tasks and processes across teams, product categories, and markets repeatedly, slowing time to market and decreasing efficiencies ad infinitum. Ultimately, these data silos reduce the retailer’s ability to stay agile, and they run the risk of being swiftly outpaced by competitors.
Another complicating factor is surety of supply.
Most retailers source at least a portion of their products from overseas partners. As a result, any natural disasters or geopolitical conflicts affecting various parts of the world wind up seriously affecting inventory levels—as well as transportation and materials costs—for retailers in the US and Europe.
For example, when a sharp rise in Covid cases shuttered factories in Vietnam earlier this year, Adidas faced an estimated 500 million euros in lost sales due to an inability to meet rising consumer demand.
Increasingly, supply chain disruptions caused by factory shutdowns, raw materials shortages and shipping delays worldwide have a significant impact on major American and European retailers.
When companies face supply chain disruptions across multiple product categories and multiple markets, these issues compound to create a cascade of lost sales, logistics issues and production snags.
Enabling multi-enterprise business partner connectivity
While there are many challenges associated with managing multiples, there is fortunately a singular solution that can yield improvements across all areas of the sourcing and supply chain process.
The answer, essentially, is to break down data and communication silos and aggregate buying across target selling geographies, sourcing markets, product development processes and product categories.
Implementing a single Multi-Enterprise Platform (MEP) enables retailers to eliminate disparate purchase orders, product development, sourcing and global trade management systems and instead use a single solution capable of uniting all processes, markets and product categories.
Leveraging a single MEP gives buying teams the visibility they need to identify new, innovative products while streamlining operations. This two-fold advantage positions retailers to lower margins through reduced operating costs and aggregated buying while also increasing sales through innovative product offerings.
An MEP also ensures retailers have the agility to identify new buying partners without introducing compliance or regulatory risk. This solves for supply chain disruption: when supply chain disruption occurs and specific sourcing partners are unable to meet retailer needs, retailers have the option to maintain inventory and maximize sales by safely diversifying their supplier base to include new partners.
Implementing a single, unified platform also allows retailers to collaborate with suppliers easily and transparently on evolving consumer expectations across markets to increase sell-through. Onboarding all supplier partners onto the same platform ensures immediate data exchange, instantaneous communication, and quick project handoffs.
Ultimately, the flexibility and visibility of an MEP allows retailers to seamlessly support multiple selling markets, multiple product categories, multiple sourcing geographies, and multiple business models to capitalize on emergent sales opportunities, outpace competition, and consistently achieve growth goals.
To learn more about how Bamboo Rose Multi Enterprise Platform leverages process and partner visibility to hybridize expansion into new sourcing geographies and selling markets with emergent strategic initiatives, check out our recent white papers on ESG initiatives and supply chain as a strategic differentiator.