Saturday, May 14, 2005

Personal experience with the inefficiencies of supply chains as they are today

You and I, as consumers, do not see how inefficient supply chains are, most of the time. We assume that what is hidden from us, works great. We had a personal experience with a retail supply chain that further cemented the thoughts about opportunities for supply chain improvements.
We were at one of the large chain retailers specializing in baby products (to be left unnamed). We liked a particular type of car seat. They had one on display but did not have one on the shelf. No panic. We asked the sales representative whether they have one in the backroom that can be brought up to the front. No, they are out of stock. Are there other stores in this area that have it? No, those stores are also out of stock. I guess we stumbled on a hot selling item. That is okay. When can we expect to see some in the store? The answer to this one took the cake. The store clerk can see that they have 17 in the local warehouse. The people at the store have no way of finding out which store they will get allocated to. They have no idea when it will be shipped to the stores. Their advice to us was to keep checking every Tuesday after 10 AM to see if any has come to that store! That is when they get the truck.
The summary: There is a hot selling product. They have one on display at each of the stores. They have 17 sitting in the local warehouse. Still they can not figure out how to meet a customer's need who is willing to wait. They have no way of telling the customer how long they have to wait to get it.
We checked back a week later. The 17 were still sitting in the warehouse! Needless to say the business went to one of the mass merchandisers who carried it rather than to this specialty chain! There is a lot to be improved in the world of supply chains!
What do you think?
Karthik Mani

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