CSCMP's Supply Chain Quarterly
December 18, 2017
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Managing the last 50 yards

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If they want to know what's on their store shelves, then retailers should take a page from warehouse operators.

Forget about the last mile—it's the last 50 yards that have become the biggest supply chain challenge for many retailers.

Retailers often don't know the amount and type of inventory that's available in their backrooms to replace an item that's missing from store shelves. Typically, when a truck arrives at a retail store, the delivered items are logged in as "arrived." But just because a product is on the premises, that does not mean it has been set out for sale. All too often, store operators can't say exactly where those items are.

As traditional brick-and-mortar retailers face fierce competition from online merchants, shelf availability takes on critical importance. If the product is not on the shelf when the customer comes into a store to shop, then there's a "lost sale." And if the product is in the store but is still sitting in the backroom, then it's more than a lost sale—it's also inventory that's tying up working capital.

What's needed to solve this problem? Greater in-store visibility. Some retailers are looking at radio-frequency tagging of individual items as a solution, but the price of that technology means it's still not practical for most low-valued products.

A more achievable solution is to follow standard warehouse putaway practices, adapted to the retail store. When a shipment of goods arrives, it is recorded as simply that: an arrival. When items are placed on the shelf, stockers scan the item and its associated bar code as well as a bar-coded shelf-location label. That will document the item's arrival on the store shelf, where it is available for sale.

Yes, it's extra work, and it does require implementing store location software. But the retail supply chain can no longer afford to operate with no end-point visibility. The last 50 yards are just too crucial to making sales.

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

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