What Are the Four Elements of Supply Chain Management?

Integration is at the Heart of the Supply Chain

This could be considered the brains and heart of the supply chain.
Overseeing supply chain integration means coordinating communications
between the rest of the supply chain to produce effective and timely results.
Often, this means exploring new software or other technological means to
foster communications among departments. Those in charge of integration
are responsible for making sure that things are happening on time and on
the budget, without sacrificing quality.

 Supply Chain Operations

This link in the supply chain coordinates the specifics of day-to-day
operations for the company. It plans the company’s output to make sure
everything is running well and that advantages are maximized. Operations
will keep an eye on company inventory.
They use business forecasting to predict which supplies will be needed
when and by whom and also to find ways to predict the effectiveness of
products, marketing approaches, as well as end-user results. Overall, the
company’s production is overseen by operations.
 Purchasing Sources a Company's Needs
This department sources the materials, products, or other goods needed to
generate the company’s products. Purchasing creates relationships with
suppliers and also identifies the qualities and quantities of necessary items.
It’s very important for those in purchasing to keep an eye on the budget for
things to be cost-effective for the company, as well as adhering to high-
quality standards.
 Distribution of Business Commodities
How do businesses commodities end up where they are supposed to?
Distribution coordinates that. The logistics of communications among
retailers, clients, or wholesalers is the responsibility of the distribution part
in the supply chain of command. These groups must keep on eye on
shipments, and to know not only what is needed in-house to produce
 products but also that the products get to the end-customer on time and in
good shape.
 The Four Elements Work Together
The four elements of supply chain management must work cohesively for
everyone’s benefit. Not only do end-customers reap the rewards; employees
themselves also reap the rewards. A well-oiled supply chain is key to a
harmonious work environment, because when everyone does what they are
supposed to do, there is less stress for everyone.

Demand management:

refers to the analysis and influence of levels of consumption. It involves

understanding what is bought, by whom, when, how and why, and then
seeking to change patterns of consumption so that total cost is minimised.
For example, procurement processes may negotiate the rate for electricity
so that it is purchased at the best possible tariff, but if usage is cut this will
result in the largest saving of all.

Why should companies have an effective process for Demand

Management?
Organizations are in a competition of applying new technologies and
analytics to make their supply chains more efficient, reduce inventory, and
improve customer satisfaction while improving profitability. This implies
the need to have an effective process for demand management.
What is demand management? Why is there a need for demand
management in supply chain?
 Demand management processes help organizations gather valuable
insight, agility, and improve the ability to plan and forecast while
increasing visibility into customer demands.
 Demand management helps companies improve inventory levels,
enhance customer service, optimize trade and promotion planning, and
enhance inventory planning.
 Demand Management is far more robust than developing a demand
forecast or sales forecast.
 Improper demand forecasting results in more supply chain costs and low
margins.
Procurement Processes in Supply Chain Management

Procurement is the process of getting the goods and services

your company needs to fulfil its business model.
The tasks involved in procurement include:
 The development of quality standards
 Financing purchases
 Negotiating price
 Goods and services purchases
 Aligning purchases to company ethics and policies
 Inventory control
 Disposal of waste products like the packaging
In the overall supply chain process, the procurement function
stops once your company has possession of the goods. For a
business to make a profit, the cost of procuring your goods must
be less than the amount you can sell the goods for, minus
whatever costs are associated with processing and selling them.

Procurement is an umbrella term that includes several core

business functions and should form a key role in corporate
strategy. Four key aspects are:

1. Company Identity
2. Market Placement
3. Company Capabilities
4. Management Issues
Therefore, to be truly effective, procurement needs to have a
broad view of company needs, values and direction.
the different types of procurement processes.

External Procurement:

Procurement starts with requirements which are the needs of the users in
the company. This in ERP becomes a Purchase Requisition. This document
is sent to the procurement department to determine the best supplier for it
that is, determination of sources of supply (SOS). Here a RFQ process takes
place and a set of vendors send in their bids. Vendor selection takes place
and an order is placed with the vendor through Purchase Order. Till here all
the activities has been happening internally in the ERP system. A PO
(Purchase Order) goes as a requisition to the vendor and the arrange for the
goods and send it to the Purchaser. This part is External processing and all
this while PO monitoring has been happening at the ERP side. Sometimes if
a specific deadline is missed then a reminder is sent to the vendor to
dispatch the goods in a process known as dunning. Once the goods reach
the purchaser then a goods receipt is issued to the customer and invoice
processing is started. Here the bill from the customer is received and
verification is done followed by which payment is done.
Stock Transfer:

When plant 1 needs certain goods and they realize that within the same
company at another plant these goods are available, then a internal
procurement occurs. The plant that requires the goods orders the materials
from another plant. A Stock transport order is raised from plant 1 to plant
2. Plant 2 receives this document and issues the goods. The stocks move
across the plants and plant 1 provides a goods receipt. It stores it internally.
There is no payment done as it is within the same company and only
movement of goods has occured.

Sub Contracting:

We need some add-on to be done on our raw material. Ex. Stickers on soda
bottles. The company provides the sub contractor with the bottle and the
subcontractor sticks the stickers as per the requirement of the company.
Once the product is completed, the sub contractor issues the goods and
invoice. The goods receipt and invoice verification followed by payment
process occurs at the company’s side.
Vendor Consignment:

Here the vendor supplies the goods in advance and it is stored in the
premise of the company. As and when a need arises in the company, the
goods is picked up from the stock and payment is done for what was used.
The vendor takes care of refilling goods if they run low. The stock is always
there for the customer and is generally picked up as blocks.
Well these are the types of procurement that exists in SCM. This is a bird’s
eye view of SCM processes. In the next set of blogs I will speak in depth
about SCM functionality in the system

Retail Store Operations

1. Store Atmosphere

 The store must offer a positive ambience to the customers for them to
enjoy their shopping and leave with a smile.
 The store should not give a cluttered look.
 The products should be properly arranged on the shelves according to
their sizes and patterns. Make sure products do not fall off the
shelves.
 There should be no foul smell in the store as it irritates the customers.
  The floor, ceiling, carpet, walls and even the mannequins should not
have unwanted spots.
 Never dump unnecessary packing boxes, hangers or clothes in the
dressing room. Keep it clean.
 Make sure the customers are well attended.
 Don’t allow customers to carry eatables inside the store.

2. Cash Handling

 One of the most important aspects of retailing is cash handling.

 It is essential for the retailer to track the daily cash flow to calculate
the profit and loss of the store.
 Cash Registers, electronic cash management system or an elaborate
computerized point of sale (POS) system help the retailer to manage
the daily sales and the revenue generated.

3. Prevent Shoplifting/Safety and Security

 The merchandise should not be displayed at the entry or exit of the

store.
 Do not allow customers to carry more than three dresses at one time
to the trial room.
 Install CCTVs and cameras to keep a close watch on the customers.
 Each and every merchandise should have a security tag.
 Ask the individuals to submit carry bags at the security.
 Make sure the sales representative handle the products carefully.
 Clothes should not have unwanted stains or dust marks as they lose
appeal and fail to impress the customers.
 Install a generator for power backup and to avoid unnecessary black
outs.
 Keep expensive products in closed cabinets.
 Instruct the children not to touch fragile products.
 The customers should feel safe inside the store.

4. Customer Service
  Customers are assets of the retail business and the retailer can’t
afford to lose even a single customer.
 Greet customers with a smile.
 Assist them in their shopping.
 The sales representatives should help the individuals buy
merchandise as per their need and pocket.
 The retailer must not oversell his products to the customers. Let them
decide on their own.
 Give the individual an honest and correct feedback. If any particular
outfit is not looking good on anyone, tell him the truth and suggest
him some better options.
 Never compromise on quality of products. Remember one satisfied
customer brings five more individuals to the store. Word of mouth
plays an important role in Brand Promotion.

5. Refunds and Returns

 Formulate a concrete refund policy for your store.

 The store should have fixed timings for exchange of merchandise.
 Never exchange products in lieu of cash.
 Never be rude to the customer, instead help him to find something
else.

6. Visual Merchandising

 The position of dummies should be changed frequently.

 There should be adequate light in the store. Change the burned out
lights immediately.
 Don’t stock unnecessary furniture at the store.
 Choose light and subtle colours for the walls to set the mood of the
walk-ins.
 Make sure the signage displays all the necessary information about
the store and is installed at the right place visible to all.
 The customers should be able to move and shop freely in the store.
 The retail store should be well ventilated.
7. Training Program

 The store manager must conduct frequent training programs for the
sales representatives, cashier and other team members to motivate
them from time to time.
 It is the store manager’s responsibility to update his subordinates
with the latest softwares in retail or any other developments in the
industry.
 It is the store manager’s responsibility to collate necessary reports
(sales as well as inventory) and send to the head office on a daily
basis.

8. Inventory and Stock Management

 The retailer must ensure to manage inventory to avoid being “out of

stock”.
 Every retail chain should have its own warehouse to stock the
merchandise.
 Take adequate steps to prevent loss of inventory and stock.

Opportunities in Indian retail sector

India’s retail sector is projected to grow to $1.3 trillion by 2020 from the
level of $672 billion in 2017, said Anuj Kejriwal, Managing Director & CEO,
Anarock Retail.

“The India’s retail sector is on a faster roll than ever before and the boosters
acting on retail sector are rapid urbanisation and digitisation, rising
disposable incomes and lifestyle changes, particularly that of the middle-
class,” he explained.

Consumption growth
Over the last two decades, the Indian retail market witnessed phenomenal
changes, evolving rapidly from traditional shops to large multi-format
stores in malls offering a global experience, and on to the highly tech-driven
e-commerce model. According to Kejriwal, these changes have resulted in
unprecedented growth in overall consumption with numbers suggesting
that consumer expenditure in India is expected to almost double to $3,600
billion by 2020 from $1,824 billion in 2017.

Another highlight of this growth story is that organised retail is gaining

ground. Growing significantly at a CAGR of 20-25 per cent annually,
organised retail penetration is expected to be over 10 per cent of the total
Indian retail market by 2020 as against just 7 per cent currently.

The organised retail market is estimated to increase to 19 per cent across

the top seven cities during the same period from the current 9 per cent.

High demand for a superior customer ‘experience,’ penetration of big

brands into smaller towns and cities, enhancement in business strategies
and operations, along with the movement from unorganised to organised
business have been key factors driving this growth.

Policy boosts
Furthermore, liberalisation in FDI policies by the Centre has repositioned
the Indian retail sector on the global map, attracting a large number of
global retailers into the Indian diaspora and further fuelling growth of
organised retail in the country.

The government’s decision to allow 51 per cent FDI in multi-brand retail

and 100 per cent FDI in single-brand retail under the automatic route is the
icing on the cake which has attracted giants like Walmart to make a foray
into India. By easing the FDI norms in the retail sector over the past few
years, the government has hit the bull’s eye.

The introduction of the Goods and Service Tax (GST) as a single unified tax
system in July 2017 was another major policy overhaul that is attracting
foreign players. The government’s move to provide a single-policy
framework for retail, FMCG and e-commerce in order to offer a level
playing field to stakeholders is another step in the right direction.

Market segmentation is one of most important approaches to

understand target groups. In the traditional marketing approach,
business houses look at the total market as though all of its parts are
same and market accordingly. In the market-segmentation approach,
the whole is viewed as being made up of several smaller segments,
each different from the other.

This approach enables business houses to identify one or more

appealing segments to which they can advantageously target their
products and marketing efforts. A typical market-segmentation
process involves multiple steps (as shown in figure 5.5).

Possible bases for dividing a total market are different for consumer
markets than for industrial markets. The most frequent elements
used to separate consumer markets are demographic factors,
psychographic characteristics, geographic location, and perceived
product benefits.

Marketing Segmentation Process

Although demographic, geographic, and organizational differences

enable marketers to narrow their opportunities, they rarely provide
enough specific information to make a decision on dividing the
market. Psychographic data, operational lines, and, in particular,
perceived consumer benefits and preferred business practices are
better at pinpointing buyer groupings—but they must be considered
against the broader background.

Thus, the key is to gather information on and consider all pertinent

segmentation bases before making a decision. This task becomes easy
if retailers understand the marketing segmentation process and
device their strategies accordingly. The market segmentation process
is generally regarded as consisting of six stages.

1. Understanding Customers’ Needs:

Understanding customers’ needs and wants is the very first step in a
typical market segmentation process.

It includes collecting knowledge and data about customers’ likings

and disliking, it includes answering following questions:
a. What customers want?

b. When they want?

c. Where they want?

d. How they want? – In which form? and

e. What they want?

The reasons to understand customers’ choice is mat better you

understand your customers, better you’ll be able to serve with low/no
complaints.

2. Analyzing the Characteristics of Consumers:

It means thoroughly understanding the varied characteristics of
customers.

Usually in the retailing world, customers have four essential

characteristics:

I. Particular Demand:

Most of the customers have some sort of particular demand. They

have all kinds of needs including basic survival needs (eg., food,
clothing, shelter and health), rational needs (eg., dependability,
durability, economy), and emotional needs (eg., love, sex appeal,
status, security, acceptance, and power).

II. Capacity to Buy:

It is imperative for each retailer to know whether they have enough

money to buy what you are selling. Being a retailer, remember that
just because someone wants to purchase something you are selling
does not mean they have enough money to buy it.

III. Decision Making Power:

The explanation here is to spend your time wisely with customers.

Find the customer who has the actual authority to make the choice of
buying your product or service.

IV. Ease of Availability:

Being an astute retailer, make sure that visitors have easy access to
your product or service. Accessibility is important. For instance, if
you wish to sell baked goods to people in your neighborhood, you
must either provide your goods directly to your customers or have a
small outlet where they can come to you.

Based on these characteristics, retailer has to answer the following

four questions:

a. What need does my product or service satisfy?

b. Who needs and can afford what I am offering?

c. Who has the authority to say “yes” to the product or service I am

offering? and
d. How accessible is my product or service to my customers?

Your answers to these questions from the base what a retailer need to
learn from marketing research efforts. Once retailer knows what he is
looking for, he can find more about the specific characteristics of the
customers he propose to target by looking at their liking, disliking,
ages, heritage, income level, gender, family status, education level
and occupations/professions. These factors are nothing but the
demographic variables.

The following questions are associated with analyzing the

characteristics of consumers and knowledge:

(a) Are the customers experienced in dealing with technology?

(b) Are the customers’ expectations of the end product pragmatic?

(c) Are the floor employees trained enough to answer any type of
customer queries about the product or service offered?

(d) Can the floor staff respond to the customer’s requests in a timely
manner?

(e) Will the floor staff provide proper information about how to use
safely and in best manner to customers upon delivery?

3. Dividing the Consumers into Sub-segments:

Market segmentation is an important pre-requisite for establishing
programme goals and analyzing the determinants of consumers’
behaviour. Market segmentation forms an important basis for the
success of a marketing campaign, since finding homogenous sub-
segments help to devise and implement programme goals and to
reach the desired target groups. That is, the markets should be
segmented at least to some extent.
 In market segmentation process, after analyzing the customers’
characteristics, consumer markets are split into sub-segments that
differ from each other in respect to their outlook, values and socio-
demographic features {primarily concerned with income, gender,
class, age and education, etc.).

A comprehensive and organized segmentation would involve finding

out some key characteristics of the markets, in consumer markets, for
example, the type of household (single households, couples without
children, couples with children, joint families, aged alone households
etc.) or geographic differences.

However, in market segmentation it should be kept in mind that each

individual has several alternatives and overlapping roles. Initially,
people act in double roles as consumers and citizens. As consumers,
people look for direct fulfillment of needs and wants without
considering sustainability.

As citizens their actions are guided by long-term orientation taking

environmental matters into consideration. Secondly, people have
different roles in their daily lives in work, at home, and in social
circles and leisure time activities.

4. Formulating various marketing mix for various segments:

The next stage of the market segmentation process is to formulate
various marketing mix for various segments to fulfill the needs, as well as
market conditions of each specific target segment. Although many
subject experts limit the market segmentation process to market
identification rather on the key elements of the entire process, most
companies fail to give due importance to other stages in market
segmentation such as product positioning and mix development
(Sarabia, 1996).
Once the firm has chosen a market segment it must choose a generic
competitive strategy. At this point it is also necessary to review the
selected strategy across segments and explore general strategic
approaches. In some cases it might become apparent that a counter-
segmentation strategy is applicable. In other cases, the development of
distinct mixes for each segment uncovers inconsistencies or lack of
resources at the corporate level and so it is necessary to revert to the
segment evaluation stage.

At this point in the process the company selects those ways in which it
will distinguish itself from its competitors. In most cases the
differentiation involves multiple elements. In fact, “most successful
differentiation strategies involve the total Segmentation – Targeting –
Positioning organization, its structure, systems, people, and culture.”
(Aaker, 1996).

One way to differentiate is through brand equity building. A strategy

based on brand is likely to be sustainable because it creates competitive
barriers. A brand strategy permits the strategist to work with complex
concepts and not limit the differentiation strategy to just a few
competitive differences. This approach is consistent and reinforces the
STP approach. A successful brand strategy builds barriers to protect the
selected position by creating associations of the positioning variables
with the brand name in the prospect’s mind.

Thus differentiated marketing is used when retailer has to approach

multiple marketing mixes. This will involve multiple products, targeted
towards multiple segments. For example, a clothing brand such as Peter
England- will have multiple marketing mixes to approach various
consumers’ segments. This practice is common in the world of retail and
is best suitable to fulfill the needs and wants of multiple segments.

5. Collecting feedback from various segments:

The retailer’s main task here is to collect feedback from various sub-
segments to know where company should focus its resources, along with
their relative importance to each other. Each segment is then assessed
against these factors in terms of how well it can met your requirements
and by taking the relative importance of these factors into account an
attractiveness score is determined.

The results are then transposed onto the vertical axis of a portfolio
matrix as this is a useful tool for constructing a strategic picture of your
market.

Measuring the positive impact on the business will help to

determine whether the methods used to collect relevant data,
evaluate, and implement segmentation:
i. Are effective and competitive – in sales/market results/savings and or
in process efficiency,

ii. Are they requiring further improvement?

The criteria to collect feedback involve the following aspects:

6. Selecting Higher Potential Segments:
After collecting feedback from various segments, retailer’s job is to
decide which and how many segments to serve.

Focusing Single Segment:

As the name implies, in this case, a retail company selects a single
segment. Through concentrated marketing, the firm gains a deep
knowledge of the segment’s expectations and achieves a competitive
market position in that particular segment. In addition, the company
enjoys operating economies through specializing its production,
distribution, and promotion.

In case company is able to become leader in the segment, the firm can
earn a high return on its investment. However, concentrated marketing
always involves higher than normal risks. A particular market segment
can turn sour any time or a competitor may march into the segment. For
these reasons, most of the retailing firms prefer to operate in more than
one segment.

Focusing Selective Segment:

In this case, the company selects a number of segments each
independently striking and appropriate, given the firm’s objectives and
resources. There may be less or no synergy among the segments, but
each segment promises to be a moneymaker.

Selective segment coverage strategy has the benefit of diversifying the

company’s risk. Selective specialization is becoming quite popular in FM
radio broadcasting. Radio broadcasters that want to appeal both to
younger and older listeners can do so by having two different stations in
the same market. Similarly most of the car companies, have adopted
policies of more than one models to satisfy various income groups.

Focusing Product Specialization:

In this case, the company concentrates on producing or acquiring a
certain product that it sells to various segments. Product specialization
strategy enables a firm in building a strong goodwill in the specific
product area. The main shortcoming in adopting such policy is that the
product may be replaced by an entirely new technology any time
resulting in huge losses to the firm.

Focusing Market Specialization:

In this case, the company concentrates on serving varied needs of a
particular customer group. The firm gains a strong reputation for
specializing in serving the customer group and becomes a channel for all
new products that the customer group could feasibly utilize The
shortcoming of this policy is that the customer group may have its
budgets cut resulting in loosing customers and market share.

Focusing Full market:

In this case, as the name implies, the company attempts to serve all
customer groups with all the products that they might need. Adopting
full market specialization seems to be attractive and lucrative but can be
undertaken by only large companies. Large companies can full market in
two broad ways, through undifferentiated marketing or differentiated
marketing.

In evaluating different market segments, retailer considers two

factors:

(i) The segment’s overall attractiveness

(ii) The firm’ objectives and overall resources.

It helps a retailer to customize the goods & services vis a vis its
promotional campaigns according to the needs of narrowly defined
customer group.

Significance of Market Segmentation:

Retailers segment the market to identify particular groups of
Customers in their trading areas so that selling and promotional
efforts may be concentrated. The purpose of such exercise is to make
the retailer the most attractive destination. Segmenting a market has
following advantages shown in figure 5.1.

Advantages of Market Segmentation

1. Deciding Store Location:

Market segmentation helps a retailer in deciding locations for its new
outlets in case of expansion. The retail stores may be set up as per the
concentration of target population. A location which is attractive and
has good traffic flow but serves no target market is of new use to a
retailer.

2. Understanding consumer behavior:

Market segmentation helps a retailer to understand why consumers
behave differently in a same set of marketing and promotional efforts.
Once a heterogeneous market is divided into few homogeneous
groups, it becomes easy for a retailer to develop an effective
marketing & promotional strategy.

3. Deciding retail marketing mix:

Marketing segmentation helps a retailers in deciding 7ps (Product,
Price, Place, promotion, People, Procedure and presentation)
depending upon the target market to serviced.

4. Deciding merchandise assortments:

A retailer is always bothered about which item of inventory should be
bought and displayed on the store’s shelves. Once the market is
segmented, retailer can decide which item will go on the shelves. For
a merchandise decision to be made successful, a perfect
understanding of particular target market is essential.

5. Deciding promotional campaigns:

Segmentation helps a retailer in deciding and developing accurate
promotional campaigns that hit target at right time and at right place.

6. Positioning:
Segmentation helps a retailer in positioning itself in a particular
target market. For Instance, Ebony and Shopper’s stop have
positioned themselves for higher income level while Vishal Mega
Mart and Big Bazaar have targeted the Indian middle class.
 Supply Chain Management - Role of IT
Companies that opt to participate in supply chain management initiatives
accept a specific role to enact. They have a mutual feeling that they, along
with all other supply chain participants, will be better off because of this
collaborative effort. The fundamental issue here is power. The last two
decades have seen the shifting of power from manufacturers to retailers.

When we talk about information access for the supply chain, retailers have
an essential designation. They emerge to the position of prominence with
the help of technologies. The advancement of inter organizational
information system for the supply chain has three distinct benefits. These
are −

 Cost reduction − The advancement of technology has further led to ready

availability of all the products with different offers and discounts. This leads to
reduction of costs of products.

 Productivity − The growth of information technology has improved productivity

because of inventions of new tools and software. That makes productivity much
easier and less time consuming.

 Improvement and product/market strategies − Recent years have seen a huge

growth in not only the technologies but the market itself. New strategies are made
to allure customers and new ideas are being experimented for improving the
product.

It would be appropriate to say that information technology is a vital organ

of supply chain management. With the advancement of technologies, new
products are being introduced within fraction of seconds increasing their
demand in the market. Let us study the role of information technology in
supply chain management briefly.

The software as well as the hardware part needs to be considered in the

advancement and maintenance of supply chain information systems. The
hardware part comprises computer's input/output devices like the screen,
printer, mouse and storage media. The software part comprises the entire
system and application program used for processing transactions
management control, decision-making and strategic planning.

Here we will be discussing the role of some critical hardware and software
devices in SCM. These are briefed below −
Electronic Commerce
Electronic commerce involves the broad range of tools and techniques used
to conduct business in a paperless environment. Hence it comprises
electronic data interchange, e-mail, electronic fund transfers, electronic
publishing, image processing, electronic bulletin boards, shared databases
and magnetic/optical data capture.

Electronic commerce helps enterprises to automate the process of

transferring records, documents, data and information electronically
between suppliers and customers, thus making the communication process
a lot easier, cheaper and less time consuming.

Electronic Data Interchange

Electronic Data Interchange (EDI) involves the swapping of business
documents in a standard format from computer-to-computer. It presents
the capability as well as the practice of exchanging information between two
companies electronically rather than the traditional form of mail, courier, &
fax.

The major advantages of EDI are as follows −

 Instant processing of information

 Improvised customer service
 Limited paper work
 High productivity
 Advanced tracing and expediting
 Cost efficiency
 Competitive benefit
  Advanced billing

The application of EDI supply chain partners can overcome the deformity
and falsehood in supply and demand information by remodeling
technologies to support real time sharing of actual demand and supply
information.

Barcode Scanning
We can see the application of barcode scanners in the checkout counters of
super market. This code states the name of product along with its
manufacturer. Some other practical applications of barcode scanners are
tracking the moving items like elements in PC assembly operations and
automobiles in assembly plants.

Data Warehouse
Data warehouse can be defined as a store comprising all the databases. It
is a centralized database that is prolonged independently from the
production system database of a company.

Many companies maintain multiple databases. Instead of some particular

business processes, it is established around informational subjects. The
data present in data warehouses is time dependent and easily accessible.
Historical data may also be accumulated in data warehouse.

Enterprise Resource Planning(ERP) Tools

The ERP system has now become the base of many IT infrastructures.
Some of the ERP tools are Baan, SAP, PeopleSoft. ERP system has now
become the processing tool of many companies. They grab the data and
minimize the manual activities and tasks related to processing financial,
inventory and customer order information.

ERP system holds a high level of integration that is achieved through the
proper application of a single data model, improving mutual understanding
of what the shared data represents and constructing a set of rules for
accessing data.

With the advancement of technology, we can say that world is shrinking day
by day. Similarly, customers' expectations are increasing. Also companies
are being more prone to uncertain environment. In this running market, a
company can only sustain if it accepts the fact that their conventional
supply chain integration needs to be expanded beyond their peripheries.

The strategic and technological interventions in supply chain have a huge

effect in predicting the buy and sell features of a company. A company
should try to use the potential of the internet to the maximum level through
clear vision, strong planning and technical insight. This is essential for
better supply chain management and also for improved competitiveness.

We can see how Internet technology, World Wide Web, electronic commerce
etc. has changed the way in which a company does business. These
companies must acknowledge the power of technology to work together
with their business partners.

We can in fact say that IT has launched a new breed of SCM application.
The Internet and other networking links learn from the performance in the
past and observe the historical trends in order to identify how much product
should be made along with the best and cost effective methods for
warehousing it or shipping it to retailer.

5 trends that will redefine retail in 2019

Trend 1: Experiential Retail

Experiential retail draws the focus to a customer-centric
approach where the customer is able to interact with product or
brand rather than being a passive participant.
As consumers choose to invest in experiences rather than products,
retailers need to respond to meet the needs of their customers. Customers
do not want to just walk into the shop, buy the product and leave because
they could do this in the comfort of their own home.

For instance: Slew of retailers provide a screen for customers to use where
they can sign in and search their purchase history and bucket list, providing
customer insight for the sales assistants.

There is also a smart mirror so they can request different sizes, alternative
products or even pay without leaving the dressing room. Their high tech
advancements also give the customers the opportunity to customize and
order shoes, with different styles and fabrics.

Trend 2: Augmented Reality vs Virtual Reality

Retailers are beginning to experiment with virtual commerce, which
leverages virtual and augmented reality devices to create entirely new
conveniences for tomorrow's consumers. Augmented reality (AR) is slightly
different from virtual reality (VR) as it overlays holograms on top of the
physical world around us. Experts have noted that by 2020, the retail
industry is slated to be the top spending industry on AR and VR.

For instance: IkEA launched a new VR experience that places shoppers in

the middle of a shoppable, 3D kitchen.

Trend 3: Multi-Channel Retail

Moving away from the tenants of the traditional retail market, multi-
channel retailing has gained increasing popularity. The aim is for the
retailer to be available to the consumer on all devices. The most common
device used by shoppers nowadays is their mobile phones.

With online shopping available at the click of a button and features like
product details, size guide and free shipping, it is imperative for retailers to
move their businesses online.

For instance: Future Retail owns brick and mortar stores, while they have
also tied up with e-commerce websites such as Amazon and Myntra for
selling its products. Future Retail also has a mobile app and Big Bazaar
website for shopping.

Trend 4: Hyper Personalisation

The driving purpose behind today’s retail trends is to elevate the consumer-
retailer relationship by increasing personalisation, transforming customers
into fans and boosting Customer Lifetime Value.

Imagine a store where 99 percent of the items are selected for a customer
based on their history and preferences. A shoppable virtual fridge stocked
with your favourite foods. A smart speaker that knows your order history
and can order your usual coffee with a simple voice command. A store
where the inventory, messaging, prices and sizes are dynamically changed
for you. It will soon seem absurd that we ever wasted time shopping at
stores not designed for us.

For instance: Stitch Fix is an online retailer that offers customers access to
personal stylists who help them find clothing based on their sartorial tastes.
The hand-selected pieces are shipped to their door and customers keep
what they want and send back the rest. With the option to do this
automatically or on demand, customers can buy what works best for their
budget and their closet.

Trend 5: Automated Retail

Lastly, the retail industry is slowly working towards creating a human
interaction-free experience for the consumer. Moving rapidly towards
automation on all fronts, many retailers have already adopted the cashier-
less model – be it small merchants or large ones.

Automated retail is now a broad area including everything from vending

machines to unmanned kiosks to unattended grocery stores.

For instance: BigBasket has launched BB Instant, as part of a broader

strategy to increase the volume and frequency of orders on its platform.

Bigbasket has placed physical kiosks containing grocery items and

consumables in several apartment complexes.These are unmanned kiosks.
Customers can place orders on the BigBasket app and when they pick up
the order, it automatically bills the wallet.

The retail industry will keep evolving at breakneck speed, but hopefully,
preparing for these five trends will arm retailers with the insights and
skills to grow the retail store in 2019 and beyond.