Study: The ‘Amazon Effect’ Is Changing The Face Of Retail’s Backend

As mobile and omnichannel are changing the face of retail – and the “Amazon effect” is changing customer demands and expectations for their front-end experiences, retailers of all stripes are being forced to re-evaluate their back-end systems and operations.

Such is the conclusion of a new study out of Auburn University’s Center for Supply Chain Innovation, the Retail Industry Leaders Association (RILA) and Checkpoint Systems, “The State of the Retail Supply Chain.” According to the report, 81 percent of respondents are either using, developing or investigating integrated demand planning, reported Chain Store Age.

The reasons why break down into two categories – one is to get more goods into the hands of customers, the obvious and eternal point to anything a retailer does ever. The other, more modern goal is to get better data about the demand for goods and services at a much more granular level than they currently have access to.

Over two-thirds are also pushing into omnichannel fulfillment – a contributing factor to the almost two-thirds that opine that eCommerce has greatly complicated their business activities in the last decade or so. And, apparently, it is also an expense adding item for most retailers, as 56 percent had indicated that their firms will be pushing up their spending on supply chain process improvement over the course of the next year, while 49 percent are at firms that will be pushing omnichannel fulfillment and “click-to-delivery” capabilities.

“Amazon is at the epicenter of this,” noted Brian Gibson, executive director of the Center for Supply Chain Innovation, told CSA. “They’re really forcing everyone to up their game, and everybody is feeling pressure. You can’t have a conversation with a retail executive today without it coming back to the omnichannel topic — how you’re trying to monetize it and make it profitable. And how do I get my product delivered quickly and, at the same time, efficiently?”


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