It’s time for a consumer-focused supply chain

The supply chain is increasingly shaping the consumer experience and playing a significant role in customer satisfaction. That realization needs to start guiding how companies structure their supply chain operations, according to a panel discussion at the Council of Supply Chain Management Professional’s annual EDGE Conference.

“We should all be thinking about the consumer marketplace, not just retailers,” said Terry Esper, associate professor of logistics at The Ohio State University.

Charles Ickes, president of the third-party logistics provider Bergen Logistics, concurred. With the increasing rise of e-commerce, so much what his company does—even seemingly little things like adding a ribbon or a spritz of perfume to the box—adds to the consumer’s experience of the product. “So much is changing,” said Ickes, “We are the brand experience.”

According to Esper, taking a consumer-centric approach to the supply chain does not mean that companies should abandon their focus on their direct customer. Instead, they should adopt a perspective similar to bifocal glasses, with one lens focused on their customer and one lens on the consumer.

In fact, according to Lee Beard, vice president of transportation and global logistics, at the retailer Nordstrom, this focus on the consumer will actually help companies be a better supplier to their direct customer.

The shift to consumer-centricity, however, will not necessarily be easy. It will require a cultural change, including different key performance indicators (KPIs).

“Are you measuring what matters to the end consumer?” asked Beard. “Delivered cost. In-time delivery to the store. The consumer doesn’t really care a lot about many of the KPIs that you track.”