New store-supply-chain scenario
Supply chain visibility is important in omnichannel success. The Internet of Things could be the perfect tool to keep inventory hiccups throughout the demand chain to a minimum.
“While many retailers have a mind-set that IoT is about satisfying customers and not moving product, supply chain IoT use cases still interest retailers,” said Steve Rowen, managing partner at Retail Systems Research.
Indeed, many experts agree that IoT technologies will play a big role in retail supply chain and delivery operations going forward. Housewares retailer Lakeland, for example, has connected mobile devices “in every area of operation,” said Gary Marshall, the U.K.-based retailer’s director of operations.
“Special purpose devices or wearables are in use in the warehouse; mobile or telematics are available in [depot] vehicles, and a variety of connected technologies, including mobile point-of-sale, beacons and smart printers, are in the store,” he explained.
For some brands, the ideal scenarios blend the store experience with the supply chain. One retailer that is using IoT to bridge the historic gap between its stores and supply chain is Levi Strauss & Co.
Through a proof-of-concept program, Levi’s San Francisco store features radio frequency identification-tagged merchandise and Intel-powered sensors. As RFID tags connect with sensors, store associates have real-time visibility into inventory levels, as well as item movement.
From a service standpoint, “inventory accuracy is near 100%,” said Noah Treshnell, senior VP, Retail Americas, Levi’s. “Associates are able to find specific items and sizes for shoppers in real time, which empowers our stylists and improves service.”
On the back-end, this data moves through the cloud and creates replenishment alerts when inventories are low. These notifications are defined by subcategories, including size and color, among other criteria, and by designated location.
“Data is shared with the executive team, stylists, and at the supply chain level,” Treshnell added. “This information makes our inventory management more effective, and helps us make better decisions to benefit in-store customers.”
In a white paper, Accenture Strategy outlined some of the opportunities the IoT movement offers retailers in the supply chain. These range from smart shelves in stores that detect when inventory is low to smart packaging that monitors freshness or the age of perishable goods.