If time is money, then being lean is both. Thanks to mega retailers worldwide, lean principles have rapidly spread to a variety of different manufacturers, such as consumer foods, apparel and food/beverage.
Over the past few years, these retailers have dramatically changed how they do business in order to stay competitive in the marketplace. How products are ordered, how inventory is moved throughout distribution centers and barcodes vs. RFID technology for inventory management have all been taken into consideration in order to work as swiftly and efficiently as possible.
While lean thinking has been rapidly expanding amongst large manufacturers and retailers, there are still a lot of companies that have hardly implemented any lean concepts.
At the end of the day lean is about adding value for customers; but how can companies do that while also reaping in benefits for themselves?
Lean opportunities for retailers fall into three basic categories:
1. Retail Strategy
For lean concepts to be successfully applied within a retail or wholesale organization, departmental strategies need to be aligned with and support an overall lean company strategy in order to efficiently function as one lean, cohesive machine.
2. Merchandise Management
When it comes down to it, efficiently managing merchandise comes down to having the right product at the right price at the right time. To achieve this developing, securing, pricing support and communicating the retailer’s merchandise offering effectively is of the utmost importance. Failing to manage merchandise using lean principles causes waste, taking away value from both the customer and the enterprise.
3. Store and Distribution Operations
Store and distribution operations tend to be where companies have the biggest amount of waste. Depending on how many stores are involved, it can be one of the hardest areas to manage, making lean principles seem unattainable. But distribution is all about optimizing trade-offs between handling costs and warehousing costs, maximizing the warehouse while maintaining low costs and minimizing time.
It’s All About the Customer
In a retail environment, it’s crucial to consider store operations and process improvements from the customers’ point of view before making lean improvements. Remember, what’s good for the customer is good for your business; it’s just about finding the right solution.
Analyzing in-store logistics can be very beneficial to becoming a lean organization.
In addition to those crucial last customer-facing moments in the retail environment, such as e-commerce, adds an entirely new layer of challenges to becoming a lean organization.
Identifying where customers will see value across all channels and applying lean concepts to these areas is crucial in retail and wholesale environments in order to succeed in today’s competitive market.