Retail Marketing
Magic Solutions
Lecture15LogisticsDistribution1132019.pptx13/03/2019
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Retail Marketing and Management
Wednesday 13 March 2019
Venue: EFRY 01.02
Dr Arijit Bhattacharya
Retail Logistics and Distribution: Competitive Advantage through Operational Strategies
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09/05/2015
Outline
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Tesco’s One-Touch Replenishment
Supply Chain, Retail Logistics, Distribution and Competitive Factors
Shelf Ready Packaging
Automated supermarket shelf replenishment
Amazon Go Store
Technologies in Retail Stores
Examples of Technologies in Retail SC
Supply Chain, Retail Logistics, Distribution and Competitive Factors
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Overview of Supply Chain & Logistics
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Marketing Channel, Logistics & Supply Chain management
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Retail Logistics and Distribution
Providing cost advantage and effective partnering with their suppliers and business customers.
Coordination/collaboration with their SC partners.
Product visibility.
Daily demand prediction.
Developing core competencies and outsourcing non-core competencies.
NPI = New Product Introduction
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Retail Competitive Factors
Key SC/logistics dimensions:
Operational efficiency,
Supply chain responsiveness and
Sustainability.
NPI = New Product Introduction
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Tesco’s One-Touch Replenishment
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Tesco Cola
Tesco Cola: How do they sell it at a low price?
Addressed Lean Order Fulfilment
One-Touch Replenishment
NPI = New Product Introduction
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Tesco One-Touch Replenishment
Tesco
Store
Tesco
Back of
Store
Tesco
RDC
Cola
RDC
Cola
Production
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30% Lower Logistics Costs
Tesco
Back of
Store
Tesco
X Dock
Cola
RDC
Cola
Production
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Tesco
Store
RDC - Regional Distribution Center.
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Shelf Ready Packaging (Retail Ready Packaging)
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On-shelf SRP design
During 2006, Mills and ICA Norway worked collaboratively on an SRP solution for Soft Flora Light.
Objectives: to (i) reduce replenishment costs and shrinkage, and (ii) increase sales through improved product visibility, and (iii) On shelf availability (OSA).
Re-designed packaging solution delivered significant productivity savings on product replenishment, equating to a total of approximately €375,000.
Soft Flora Light Case
Corrugated Cardboard Produce Tray
OSA = On shelf availability; SRP = Shelf ready packaging.
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SRP design: Stationary Case
Easy product identification for store personnel
Easy brand identification for shoppers.
Easy ID
Easy Open
Easy Shelf
Easy Dispose
Easy Shop
SRP = Shelf ready packaging. OOS = out of stock.
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Kraft Foods were preparing to implement a new on-shelf SRP unit for Côte d’Or chocolate tablets. SRP opportunities were identified.
Before – Low SRP score
After – High SRP score
Chocolate Case Study
Corrugated Cardboard Produce Tray
Ordinary packaging box
SRP = Shelf ready packaging.
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Why Shelf Ready Packaging in Stores?
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Easy to recognise
Easy to open
Faster replenishment
Reduce replenishment costs
Improve product presentation
Product visibility and easy navigation for shoppers
Reduce equipment from stores (e.g. risers, pushers, dividers, hanging bars, etc.)
Reduce product waste (i.e. shrinkage)
Shelf Ready Packaging helps in a number of ways. Products are:
Technologies in Stores
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Why Technologies in Retail?
Supply chain synchronisation and coordination (e.g. better forecasting, demand & supply matching)
Time compression (e.g. faster replenishment)
Customer oriented operations
Reduced schedule variability
Shorter planning periods
Information visibility
SRP = Shelf ready packaging. OOS = out of stock.
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What are the common Communication Technologies
Common technologies used in stores:
Handheld Mobile Computers
Barcode Scanners / RFID readers
Wearable Computer
Freezer Applications
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Retailers and restaurants use RFID to track condition of goods.
Examples: Retailers install sensors with RFID tags in order to monitor food temperature during foods’ shipment to prevent spoilage
The store can identify foods that are going to spoil.
Ex: Pintokona, a restaurant in Japan, is using RFID technology to ensure that only the most fresh fish is served to its customers.
Future of RFID / Sensors
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Tracking every aspect of logistics journey…
Real-Time Visibility – SenseAware®
Source: https://smallbusiness.fedex.com/high-value-shipments.html
Location
Temperature
Light
Security
Chain of custody
Examples of Technologies in Retail SC
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Automated Supermarket Shelf Replenishment
Automated supermarket shelf replenishment
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Future Stores: “Just Walk out Technology”
URL: https://youtu.be/zdbumR6Bhd8
https://www.amazon.com/b?node=16008589011
Amazon Go Store (cashier-less store)
They use:
Advance machine learning (deep learning algorithms)
Computer vision
Artificial intelligence
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Tesco Plc. the launched virtual shops in South Korea under the name of Home Plus in 2011.
Is the trend spreading?
2012
In a tube station in Portugal …
Result
The number of new registered online members rose by 76% and online sales increased by 130%.
Visual Stores
Cost reduction
Innovation and competitive differentiation
Time saver
Visual Stores
Tesco Home Plus Virtual Subway Store in South Korea: https://www.youtube.com/watch?v=fGaVFRzTTP4
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In-store Innovation at Tesco
In-store Innovation at Tesco: https://youtu.be/noa4SmYhjTA
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Retail technologies help:
to achieve greater operational efficiency and responsiveness (SC dimensions),
to provide better operational performance in the placement of orders and operation, and
to provide better management of storage and distribution (e.g. product tracking).
Take Away from Lecture …
NPI = New Product Introduction
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Questions?
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