As Covid-19 advances rapidly around the world, we are learning how our global interconnectivity exacerbates problems of containment during a major health crisis.
For retailers, the disruption from Covid-19 has been significant. It’s a story of extremes; while consumers cleared the shelves of staple products causing spikes in sales, the bottom is predicted to fall out of consumer spending in the longer term and supply chains cannot cope.
A recent survey by Retail Economics showed that almost a quarter of British retailers are reporting severe disruption to supply of goods as a result of coronavirus. At the same time, almost half of those surveyed had already seen a negative impact on sales, and three-quarters expected to see sales decline if the virus persists.
Thankfully, today the world possesses a massive network of data. For retailers, the management of that data becomes an even more critical platform for meeting their own needs, and ultimately those of consumers.
Harnessed effectively across sectors, data is the tool that can determine a retailer’s current and future success and survival, as the world continues to combat this dangerous outbreak and whatever comes next.
As retailers struggle to restock staples such as toilet paper, hand sanitiser, bleach and wipes to newly demanded items like gloves and masks, data, and master data management (MDM) in particular, has a key role to play as both saviour and learning curve.
Empty shelves are the new norm across the world as consumers rush to buy supplies. According to StoreBrands and a Nielsen report, hand sanitiser sales were up 73% over the prior-year period in February.
Additionally, despite the UK Government discouraging the public from wearing, and therefore stockpiling face masks, ecommerce sales of medical masks have increased by 417%. Canned goods, medical gloves, water, and supplies like toilet paper follow a similar pattern. Certain products and medicines made in China are increasingly unavailable.
On the flip side, lock down means consumers are staying away from crowded shopping areas, reducing demand for other goods. Even the most prominent names on the high street are not immune. Next for example has predicted a £1bn loss of sales.
In times of crisis, both retail stores and online retailers need to know not only how much inventory they have, and which products are selling the fastest in which areas, but also what type of demand to anticipate and where they can source products from.
Potentially, using multi-domain data management (MDM) at the heart of predictive analytics, retailers could have got more of the essential products on shelves at the right time.
Consider the inventory management challenge for items a retailer might generally not stock in bulk, but that are currently considered essential. For example, personal protective equipment (PPE) is now on the shopping list of many consumers. Previously, it might have only been purchased by those caring for an elderly parent or a sick child.
However, before a retailer can ramp up stock of such items, they need to understand if a specific type of PPE is fit for purpose. This requires detailed information such as product specs and certifications. Having this data also helps retailers relay accurate information to consumers so that they can make most informed decision about their purchases.
Another way retailers could have used data and technology in early response to COVID-19 is through AI and predictive analytics to try and forecast future demand. Analysing the spike in sales of items like hand sanitiser and anti-bacterial wipes in Asia for example would have offered data to trigger retailers in Europe to procure and stock more of these products ahead of the curve.
According to Datanami, “people can take some solace in the fact that public health officials have at their disposal an array of powerful data collection and analytics techniques that previous generations lacked.”
Predictive analytics could have foreseen the havoc Covid-19 would bring. Leveraging a wide array of data sources, from IoT devices, field reports, flight manifests, social media and news sites for example, health organisations rushed to trace where the infection may have been spread and build predictive models around where the virus will take hold next.
With access to a similar level of data regarding what was being purchased in the first global hot spots, retailers could have had shelves stocked for the inevitable rush by consumers to stock up on the items that are in such high demand as the virus continues to spread in the UK.
Most supply chains now operate on a just in-time (JIT) basis. While JIT succeeds in managing costs, it soon becomes unstitched when crisis such as coronavirus prevails. The ability to applying data about the emergent pandemic could have triggered actions along the supply chain to increase production and distribution. In turn these could have helped retailers to more quickly increase inventory and manage sell through of essential items to consumers.
While it may have been difficult to anticipate specific stockpiling habits such as toilet paper, the need to increase retail availability of all the basics that people stock up on during emergencies would have been evident. With consumers using their mobile devices to fulfil their retail needs, there is also a strong case to be made for the importance of the Internet of Things (IoT).
Some of the current chaos being experienced by retailers could have been mitigated by improved data sharing from the outset. While a lot of solutions exist to manage staffing needs, there are limitations to sharing or managing this information on a universal level. Doing so could help provide for shortage of stock managers and delivery workers, helping retailers to ride the crisis more effectively.
Many traditional retailers are busy pivoting to new models such as home delivery. Overnight, traditional bricks and mortar stores have become online retailers. Accurate product information is critical to them achieving overnight what in ‘normal times’ would be a gradual transformation.
Data is mandatory to any digital business. Knowing where your products are is the only way of managing a retail environment where supply and demand become out of balance. Inventory, asset tracking and location are essential, and achievable through a multi-domain data management platform.
With consumer demand for hygiene and PPE products continuing to increase, retailers are discovering what it takes to restock inventory at scale. Data management has a crucial role to play in their ability to get products to market faster. It’s necessary to get new data into ERP systems faster, in order to quickly manufacture and deliver essential products.
Covid-19 has already forced retailers to become even more nimble than they already were. Days were lost by not applying predictive analytics that would have triggered retailers to get more of necessary items into inventory.
UK retailers might have benefited from information supplied by global companies who faced the same challenge earlier, triggering appropriate responses across supply chains.
As we look to the future, there’s no doubt that accurate, connected information will be key as governments, health organisations, retailers, manufacturers, and distributors seek answers on how they could have manage product and supply inventories, locations, employees, and physical assets more effectively. An MDM solution can play a significant role in bringing this vision to fruition.
Main image: Fotolia
Author image courtesy of Kerry Young/EnterWorks/Winshuttle