I had the pleasure of attending the National Retail Federation (NRF) Big Show in New York City this week. It was my first time attending this event, and I found the sheer size to be impressive. Omnichannel commerce was all the rage, in both exhibitor booths and in the sessions. I commuted from Boston to New York on the Acela train. This was also a first for me. I was able to monitor the speed of the train on the commute home, thanks to the iPhone application of the young millenial sitting next to me. It did indeed reach the stated speed limit of 150 miles per hr (241 km/h). However, for most of the trip, the train lumbered along at a much more moderate pace. It turns out that the tracks along much of the route are not capable of supporting the speed capability of the train. It was still a pleasant commute, but the limitations are a classic example of the inefficiencies caused by failing to attenuate the effects of all binding constraints during the transportation planning process.
Onto the News:
- Stores Confront New World of Reduced Shopper Traffic (WSJ)
- Starmount Integrates Mobile Selling into Manhattan Associates’ Omni-Channel Commerce Platform
- China ‘Overtakes US’ As World’s Top Trader
- Menlo Worldwide Logistics Announces Opening of New Facility in Malaysia
- Cass INTTRA Ocean index report, December 2013 and Year in Review
The Wall Street Journal article on reduced shopper traffic highlighted some of the hardships faced in the brick and morter retail channel. These difficulties are being driven by the increasing competition from ecommerce. Not only are traditional products being purchased online instead of at retail locations, but some goods such as compact discs (CDs) are being entirely replaced by electronic downloads. Although this trend is detrimental to traditional retail, I believe it creates opportunity for omnichannle commerce, flexible fulfillment, and parcel carriers. The article noted the following points:
“Retailers got only about half the holiday traffic in 2013 as they did just three years earlier, according to ShopperTrak, which uses a network of 60,000 shopper- counting devices to track visits at malls and large retailers across the country…..Online sales increased by more than double the rate of brick-and-mortar sales this holiday season. Shoppers don’t seem to be using physical stores to browse as much, either. Instead, they seem to be figuring out what they want online then making targeted trips to pick it up from retailers that offer the best price.”
Manhattan Associates announced the integration of its omni-channel commerce platform with Starmount Engage. The integration will offer store associates convenient mobile access to inventory information and availability from across the organization that they can use to support in-store customer inquiries. I believe this is an important step retailers can make to remain competitive in today’s omnichannel environment. I attended a session at NRF on the future of point of sale, and the digitization of the store. One panelist from a fashion retailer stated that in-store associates were able to sell product to customers via an iPad, and that approximately 8 percent of online sales were currently made from stores. Still there are many issue to be ironed out. For example, another panelist highlighted the practical issues such as who gets credit for the sale (retail location or ecommerce), and how to incentivize employees.
Switching gears to the ongoing flow of reminders about the switching balance in global trade, China’s General Administration of Customs (GAC) announced data that suggests China has overtaken the US as the world’s largest trading partner (US data for the year has not yet been released). Here are some quotes from the article:
China’s annual trade in goods passed the $4trn (£2.4trn) mark for the first time in 2013, official data has revealed, confirming its position as the world’s biggest trading nation…..The total was a record high and effectively confirmed a historic geo-economic shift, making China the world’s biggest trader of physical goods, not including services.
On a chronologically and geographically related note, Menlo Logistics announced the opening of a new facility in Malaysia. The new warehouse will offer over 100,000 square feet of storage space, offering inventory management, local and regional distribution, and value-added services.
Have an enjoyable weekend!