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Authors: Corinna Stein, Susanne-Kirsten Mueller

Pictures: Stefan Behrendt

 

Retail Logistics is a complex process that involves a lot of stakeholders, business aspects and situations that need special attention and resolution. When we are talking about the Retail supply chain to our customers or partners we frequently need to describe software components. But first, the fundamental of all is a solid understanding of all the related business scenarios. Having this knowledge, software solutions can then fit together like puzzle pieces.

We decided to showcase a strawberry yoghurt’s journey as an easy example, but processes and solutions are similar for grocery retailers, for fashion retailers, electronic retailers or do-it-yourself retailers.

So, let‘s look at all the things that can happen to a strawberry yoghurt when it moves from the field and barn to the consumer‘s home. The logistics supply chain can be very challenging for it!

Lisa is shopping

We start the journey in a supermarket. It’s Monday evening. Lisa goes shopping. She puts her favorite snack – strawberry yogurts – into her shopping cart. Only few are left on the shelf. She is wondering if she can get more the next day.

Store Order

Ed, the store manager, needs to rely on high shelf-availability to manage his store successfully and meet customer expectations.

In the evening Ed is informed that a store order for strawberry yoghurts and many other fresh items was initiated automatically and sent to the distribution center which does the replenishment of his store. Ed expects the arrival of the ordered strawberry yoghurts very early the next morning. He needs time to fill the shelves before the rush starts the next day.

Distribution Center

The distribution center receives the order from Ed‘s store together with the orders from many, many other stores. Most orders are for the next day, so Paul the manager of the distribution center has to plan and execute the necessary logistics steps during the coming night. Two of Paul‘s teams are highly involved: Connor‘s transportation and Jane‘s warehouse team. Only if both teams work tightly together under the given time pressure Paul can achieve a high service level for his customers which means (in our little example) that the required quantity of strawberry yoghurts arrives timely and in good quality at Ed‘s store.

Puuh … hard job!

Transportation Planning

Connor, being the responsible transportation manager in this distribution center, sees many store orders. Ed’s order is only one of them all. Connor’s team has to plan the trips to all of the stores. Of course, they also plan the trip for the truck which delivers the strawberry yoghurt to Ed’s store. Connor’s team chooses the right carrier and orders a refrigerated truck in the right size.

The transportation guys also must inform Jane’s warehouse team that at 4:30 in the morning the carrier’s truck will be ready for loading at door 29. Jane’s team also has to know which articles (besides the strawberry yoghurt) should be loaded into the specific truck.

Warehouse Management

Jane is responsible that all ordered goods are ready for loading. She knows that her team will be under time pressure, so she keeps many pickers ready. One of them will pick the strawberry yoghurts for Ed’s store. Jane’s team has to ensure that all the required goods for Ed’s store are picked, packed and ready for loading at door 29 the next morning at 4:30.

After half an hour for loading, Jim, the truck driver must leave. So, the warehouse team has to work fast and accurate – no time for mistakes as Jim has still a long way to Ed’s store.

Transportation Execution

In a perfect world, the truck is loaded, and truck driver Jim brings all goods at the right time, in perfect condition to the store.

And finally, Ed the store manager is happy as Lisa can buy her strawberry yoghurts again.

 

Watch out for part 2 of our story A Strawberry Yoghurt caught in the Retail Supply Chain – Part 2 to see what unpredictable things can happen to the strawberry yoghurt and how everybody involved gives his best, so Lisa will find new strawberry yoghurts on the shelf when she arrives the next day.

The story recorded in a video

Related SAP Solution blogs for Retail Digital Logistics and SAP Leonardo

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