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Five retail strategies to tackle supply chain disruption from Covid-19 & beyond

Full report: Covid-19 and the Future of Retail Supply Chains

Five retail strategies to tackle supply chain disruption from Covid-19 & beyond

3 minute read

With an industry already going through significant restructuring, Covid-19 was a sledgehammer to further disrupt the retail sector, leaving global supply chains in tatters at times.

This article is the last in a series, and forms part a wider report entitled “Covid-19 & the Future of Retail Supply Chains” which looks at the future of supply chains in a era of disruption.

Here, we look at what retailers and brands can do to make their supply chains as resilient as possible in the short term, and protect them against the challenges and shocks posed by Covid-19 pandemic and its aftermath.

As part of a toolkit for retailers to address supply chain disruption, we have identified five strategies to help them navigate the key challenges that lie ahead. This article summaries these strategies; however, download the full report here for more detail.

The five strategies include:

1. Workforce management

For most retailers, business continuity will largely hinge on their ability to intelligently manage their workforce throughout their supply chain, whether it’s on the shop floor or elsewhere in the supply chain. The majority will require visibility over their tier 1 suppliers and develop relationships that instil confidence that adequate measures are in place to limit the risk of plant closures. This will be critical when planning for periods of peak demand such as Christmas and Black Friday. It will also be critical for retailers to prepare succession plans for vital positions throughout the supply chain, ensuring key executive (and management) positions have adequate cover, should employees need to self-isolate or become ill.

Retail work force management - Retail Economics

2. Agile planning

Contingency planning across the business will be vital in reducing risks and identifying ways to mitigate the impact of the virus. Retail brands will need to assess the impact in both financial and operational terms and also develop solutions that limit the impact of supply chain disruption. A continuous review and risk assessment of supply chains is needed so that businesses have built in the necessary flexibility to switch suppliers, operate parallel supply chains if needed, or switch supplier countries if localised disruption persists. Identifying the weakest links in supply chains and understanding the impact that disruptions could have in meeting supply requirements is critical.

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View the full report here

This work forms part of a wider piece of research and is a downloadable in pdf format


3. Digital transformation

The imperative for businesses to adopt a ‘digital-first’ approach to their supply chains has never been more pressing. It will become the norm for intelligent retailers to quickly identify bottlenecks in supply chains and to pivot towards alternative suppliers to ensure supply continuity. However, this will require antiquated paper-based systems to be replaced with digital supply chains to drive greater transparency, faster and more data-driven decision making. COVID-19 may accelerate the use of Internet of Things (IoT) hardware, which links the physical and digital worlds.

Digital online transformation  - Retail Economics

4. International trade

Specific expertise around international trade policy, the implication of Brexit (and beyond), and continual assessment of the geopolitical environment will be critical in determining efficient trading strategies. The impact of Brexit (resulting from a no-deal or a Free Trade Agreement at the time of writing) will not be felt evenly across geographies or sectors. Disruption across international trade policy presents a significant opportunity for retailers to gain a competitive advantage, should they understand the implications and can move quickly to take advantage of specific policy changes.

International Trade Import Export - Retail Economics

5. Leading ESG

It will become essential for retail brands to develop credible, realistic and measurable ESG commitments that address sustainability and wider societal responsibilities. Retail brands will come under increasing pressure to disclose more data on their carbon emissions and the impact of their sourcing, supply chains, labour practices, waste and many other factors. 


Download the full report here for a more detailed look at the strategies.

Retailers might be asking themselves why and how soon are these solutions needed? Click here to view the first article on how Covid-19 and other factors have heavily affected the way retailers will need to think about their supply chains going forward.


Things to do now

Explore the first article in this series here.

Download the full report here

Found this short article interesting?

This short insight article forms part of a thought leadership report entitled “Covid-19 and the Future of Retail Supply Chains” produced by Retail Economics. It explores industry structural changes and contextualises the impact of Covid-19 on supply chains across the European retail industry. For retailers and brands seeking valuable insight into the impact of the crisis across Europe, the full report provides data-driven insights and guidance for action.

View Full Report Here

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