Retailers rank supply chain challenges

One key area of the supply chain is an area of concern for almost three-quarters of North American retailers.



Forecasting for new products is the biggest (73%) concern forNorth American retailers, according to the State of the Retail Supply Chain 2016 study from supply chain solution provider Relex and research firm Martec International. This is well above the global average of 58%, which the report attributes to the United States tending to be where most of the new products are developed and launched. This causes greater problems for North American retailers than elsewhere, where there is typically a lower proportion of new products in an assortment.



Part of the forecasting concern also may be related to a lack of visibility. North American retailers rated the visibility of their supply chains a 6.5 out of 10, indicating that they have a way to go before they achieve full visibility.



The top business issue cited by North American retailers is increasing availability without increasing stockholding (67%). The second-largest issue is better collaboration with suppliers.



In addition, North American retailers with more than one sales channel are marginally less likely than the global average to operate a single-stock pool (39% of retailers compared to the global average of 43%).



Retailers in North America are more efficient than retailers in other countries surveyed for the report in terms of staff productivity. The average full-time equivalent employee forecasts and replenishes an average of just under $270 million of sales. This compares very favorably with the overall country average of just below $190 million of sales.



According to Relex analysis, the likely reason for that finding is caused by the larger average size of the North American retailers that were interviewed and were able to realize greater economies of scale than in smaller countries. It’s easier to grow a big chain and achieve economies of scale in the United States, simply because there are so many cities where a retailer can open a store.



The report was based on 126 retailers in North America, U.K., Germany and the Nordics whose annual sales exceeded $110 million. About 26% were North American, and U.S. and Canadian retailers were interviewed with sales of more than $343 billion.