How to Build a Supply Chain for Shoe Retailer

Building or developing a supply chain strategy is of crucial importance to any business, and increasingly plays a key determining factor in their success. The Collins English Dictionary defines strategy as ‘a particular long term plan for success’, whilst it is prudent for companies to adopt ‘best practice’ across all areas of business, supply chains often play a pivotal role in this plan due to their close linkages with cost and delivery speed. With technology continually evolving at an exponential rate, the shoe industry is an area where an effective supply chain strategy can provide a competitive edge. In 1997 consultants of Andersen Consulting outlined seven key principles of successful supply chain management. The purpose of this paper is to view and utilise these principles and discuss how they could be adopted and implemented to build a supply chain strategy for a shoe retailer.

Introduction

With the similarities continuing to grow between shoe styles and technologies the competitive edge is preceding further away from the product itself and managers are looking elsewhere to increase their profitability. Whist some companies achieve this by lowering their expenditure on raw materials, this can often have an effect of reducing the value to the customer as is it now seen as a lesser product and over time will more than likely look elsewhere.

Supply chain management, when viewed from end to end can be streamlined and adjusted to not only provide the product to the consumer in a shorter space of time, it can also be adapted to allow for personal customisation. Whilst this often will not increase the actual value of the product, the implied value to the consumer has significantly increased.

The consultants at Anderson consulting identified two key themes across those they viewed as successful initiatives. Firstly that the strategies implemented and considered were significantly broad, encompassing both upper and lower level change and secondly they reflected a ‘holistic approach, viewing the supply chain from end to end’ (Anderson et al, 2007, p3). This approach allows for the identification of improvements both up and down stream which may not be otherwise achieved under a ‘traditionalist’ or silo approach where each individual is viewed and embraces best practice in isolation.

Each of the seven principles below empower managers and companies to view their business in that end to end approach and in doing so allows for the strategy to assessed for it overall achievements verses the total costs.

Segment Customers

Customers are the largest part of a company’s revenue stream so it is key to understand the needs and wants of the customer. However, customers in the past have been grouped by industry alone which stimulates a fairly narrow approach to servicing their needs.

As