The trend: With supply chains not yet restored to full health, retailers and their partners are looking for ways to futureproof operations and reduce the possibility of widespread disruption.
High-level analysis: In order for retailers and brands to understand how to prevent possible disruptions, they must have a complete view into every link in the chain, preferably in as close to real time as possible. That means coordinating with manufacturing and shipping partners to track where goods are in the production and transportation stages—and it also means investing in artificial intelligence and data analytics to get deeper insight into where problems are most likely to arise.
More automation: Labor—and labor costs—are an ongoing challenge within the supply chain. Over one-third (38%) of chief supply chain officers (CSCOs) say wage inflation has caused major disruption within the supply chain over the past two years, per IBM’s 2022 CSCO Study. And with labor shortages and strikes across the United States and Europe threatening to create serious bottlenecks, retailers are turning to robotics to ease some of the pressures.
The big takeaway: While softening demand might reduce the urgency retailers and others feel to upgrade their supply chain capabilities at this present moment, extreme weather caused by climate change is creating yet another supply chain crisis that will be even more difficult to navigate around.
Without the infrastructure in place to identify vulnerabilities and maneuver around them, retailers and manufacturers will be trapped in an ongoing cycle of delays and out-of-stock issues that will severely hurt their standing with customers and hamper their ability to compete.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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