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Trends in the Changing Landscape of Retail Supply Chain Visibility: Diversification of SKUs

In this two-part series, we will explore trends in the retail supply chain and the way freight visibility solutions can help streamline operations and create efficiencies.

With e-commerce sales on the rise, the retail supply chain is constantly shifting to adapt to meet new customer demands. No matter the product in question or where a buyer is located, shoppers expect their buying journey to be frictionless and immediate, and to top it off – free! Of course, we know it’s hardly free for companies, and it’s driving major changes in the retail supply chain. One of those major changes is the diversification of SKUs.

Not only do customers want their products faster and more immediately, but retailers are also expected to provide more variation and options than ever before for their products. SKU proliferation and the complexity of loads and products continue to balloon. Customers want to try a wide variety of new things, which results in pressure to innovate and bring new products to market quickly.

This rapid increase in the number of SKUs is directly influencing most retailers’ supply chains. Not only do retailers need to figure out how to ship these variations of goods to stores and customers worldwide, but they also have more products to keep track of to ensure they are meeting customer expectations.

An increase in the diversification of SKUs also means that retailers are spending more time on track and trace activities than ever before. From a recent market research survey Trimble Transportation conducted of 47 retail supply chain executives, 45 percent reported that employees responsible for track and trace activities spent 40 percent of their time doing so, with another 11 percent of them stating that employees spent 80-100 percent of their day just tracking and tracing shipments.

Overall, the majority of employees responsible for retail track and trace activities are spending almost half of their time doing so. As the number of SKUs continues to rise, retailers may be seeing employees spend even more time on track and trace activities. The surge in time spent on these activities could bring retailers a substantial increase in operations costs unless a better tracking solution is implemented. Implementing a technology solution such as Trimble’s Visibility solution to automate some of these processes could help streamline operations and lower costs.

In our next blog post, we will discuss another emerging trend in the retail supply chain: reverse logistics and the strain it’s putting on carriers and shippers.