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Consumers are in the Supply Chain Driving Seat

Posted on: 09-03-2016 09:50:041076


recent study by Capgemini and The Consumer Goods Forum (CGF) has predicted that linear supply chains will soon become a thing of the past. In order to stay competitive, food industry manufacturers, retails and suppliers need to instead focus on establishing a series of networks based around the consumer. The report’s foreword explains:

“Consumer behaviour has changed forever. The path to purchase is no longer linear and could involve social media, an app, web-based research, an in-store visit and an online purchase in any order. Consumers now have the means to share their concerns and opinions with a larger audience than ever, through a growing array of social and digital channels.”

Rethinking the Value Chain: New Realities in Collaborative Business

This shift in mind-set has been a long time in the making; the early warning signs were there. Once trade moved beyond the realms of bricks and mortar, and the rise of the e-commerce business model grew from strength to strength, a notable power shift emerged. Local businesses no longer held a monopoly over supply. Consumers were now spoilt for choice, impatient and knowledge rich. If businesses are unable to meet these new basic demands they’ll search for an alternative retailer that can. 

Success factors change from one industry to the next, but for retailers that operate in saturated markets and sell goods with no obvious intellectual property, we are finding that the ease of purchase is becoming more and more pertinent. Time continues to be our most precious commodity and the companies that sympathize and appreciate this, are those moving towards consumer-driven supply chain networks.

The success of Amazon’s recently announced partnership with Morrisons will be monitored closely by industry experts and competitors alike. It perfectly demonstrates the key strategic advantages incumbents of consumer-driven supply chain networks can hope to realize. It’s an up-scaled version of the Tictail and Uber project mentioned in the Capgemini and CGF study. As the report explains, it bypasses the need for an extended supply chain. Next day delivery used to be the gold standard, but delivery within the hour might just become the new norm.

As Paul McCartney once said ‘think globally, act locally’.

Bill Brazier
UK Country Manager

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