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Retail Challenges: Retail-Supplier Relationships (Market Focus)Published by: Datamonitor Published: Jul. 10, 2006 - 13 Pages Table of ContentsDATAMONITOR VIEW 1 CATALYST 1 SUMMARY 1 METHODOLOGY 1 ANALYSIS 2 Proliferation of information fuels consumer demand: Pressure is passed down the supply chain 2 Growth of the Internet, and the rise in standard of living has generated aspirations that drive customers' expectations 2 Retailer-supplier relationships are stereotypically adversarial - easy to understand given modern day market pressures 2 Was EDI the first example? 3 But the middle men came back: eMarket places promised much but never got the model right to take them to the mainstream 3 Transora (www.transora.com) 4 More than 50 large multinational companies are owners and users of Transora, including Unilever, Kraft, Pepsi, Coca-Cola, Mars, Kellogg's, Danone, Procter & Gamble, and Bush Brothers. Operating in 7 languages, Transora has interoperability projects underway with CPGmarket and GlobalNetXchange (GNX). Transora customers include GS1 [4] Member Organizations, Manufacturers, and Retailers of all sizes. The e-market was launched in 2000 in Chicago and has offices in Brazil, Mexico, France, and the United Kingdom. On May 13th 2005, Transora and UCCnet agreed to form a single organization that can more effectively serve companies seeking to realize the value of data synchronization. 4 Fickle consumers dictate a need for flexible relationships 6 Private labels focus on lowest cost provision but can also mean less loyalty to suppliers 7 Has mutual collaboration been sacrificed for margin? It may look that way, but only because demand or need always precedes the solution 7 Perhaps mutual convenience is NOT dead, as Datamonitor's research demonstrates 8 External collaboration: For EMEA retailers it didn't seem a high priority in 2004/5 9 Datamonitor's latest survey (Q2 2006) shows an appetite for addressing other elements of supplier relationships 9 Supplier consolidation 10 New suppliers 10 Sourcing strategy 11 Ethical and green strategies 11 To conclude: Closer relationships are needed, but technology is shaping the definition of 'closer' 12 APPENDIX 13 References 13 Further reading 13 Ask the analyst 13 List of Figures Figure 1: GXS's Trading Grid Messaging Service 4 Figure 2: EMEA retailers and additional service provision 8 Figure 3: Business challenges for EMEA retailers in the mid-market* 9 Figure 4: EMEA Retailers' supplier activities, Q2 2006 10 AbstractIntroductionAnalysis of many elements of the retail market should acknowledge that the demands placed on retailers by their customers are to some extent unpredictable, yet in many respects, are simply natural effects of broader social evolution. This brief addresses the challenges faced by retailers and explores how such challenges influence retailer-supplier relationships Scope Proliferation of information fuels consumer demand: Pressure is passed down the supply chain Fickle consumers dictate a need for flexible relationships; Retailer-supplier activities in 2006 hint at widespread implications for the future Highlights The growth of the Internet, and the rise in standard of living has generated aspirations that drive customers' expectations. Pressure felt by retailers. Indeed, suppliers are under as much pressure as the retailers, as retailers will not face the competitive burden alone and have passed on demands for lowest cost products and performance to them. The focus of the brief forces us to examine 'flexibility' from its broadest possible viewpoint: - Supply chain processes that can be turned off and on when needed; - IT solutions that can be utilized when needed and not cost burdens when not; - Contracts that mitigate risk by ensuring provision for opposite ends of the scale of engagement. It is consumer and market pressures that are driving retailer's activities. Collaboration will indeed be an important element of many of these issues but it is likely to be manifest in a stronger need for increased flexibility on the supplier's part, rather than improvements in working relationships. Reasons to Purchase Appreciate contributory factors and drivers which influence retailer-supplier dynamics Understand how supplier- retailer collaboration is alive and well through necessity in an evolving market Add relevant context to target audience dialogue Get Full Details About This Report >> |
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