The Hyper-Personalized Supply Chain is Coming: Are You Ready?

James Thew/Adobe Stock

Spend Matters welcomes this guest post from Jim Wetekamp, chief executive officer of BravoSolution .

The concept of the demand-driven supply chain has been around for a decade or more. For supply chain organizations in consumer-centric markets, the model requires the ability to ramp production up and down based on demand fluctuations in short cycles. Think that change was a roller coaster ride? Well, fasten your seat belts.

The new normal, especially for retail, will feel like a tsunami of change: hyper-personalization, or the ability to serve consumers as individuals, will enable retailers to finally give consumers what they want, when, where and how they want it — but it will require sweeping changes in the end-to-end procurement process to get it right.

Let that sink in for minute. Customers are increasingly expecting that they will be able to choose products that reflect their preferences, get them overnight (or sooner) and not necessarily pay a premium for all of these requests.

It’s not as though we haven’t seen this coming. Online shopping fundamentally transformed the retail experience. To stay competitive, retailers have had to differentiate through things that matter most to customers — selection, personalization, price, delivery time frames, etc. Some have done it well. Others continue to struggle.

What’s changed recently are the stakes. Amazon’s acquisition of Whole Foods ups the ante in so many ways that it’s hard to narrow the takeaways for procurement teams down to one. The grocery supply chain is possibly the oldest around — and it hasn’t changed all that much in decades. For supply chain and procurement teams in the grocery business, the deal is a clarion call to move quickly toward the gold standard for the consumer-driven supply chain. How that happens will be watched closely by anyone with a supply chain — other online retailers, brick-and-mortar stores, consumer technology manufacturers and others.

What does that mean? I expect we’ll see the technologies that enable the hyper-personalized supply chain be short-listed for investment. These include:

  • End-user facing ordering systems powered by artificial intelligence
  • Single item push-button replenishment
  • Improved inventory control

The last-mile, too, will see broader transformation. A tighter integration between order, production and delivery is essential to meeting consumer expectations for fast arrival of their most recent heart’s desire or their daily basic needs.

In the end, we’re talking about technology and innovation that enables a much closer connection between the buyer and seller, paving new paths for engagement, experience and, of course, sales. Using them to build the hyper-personalized supply chain that delivers exactly what the customer wants, when, where and how they want it will become the measure of world-class supply chain management.

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