Market Collaborative Forces

The supply chain partners realized a long time ago that they would need to collaborate across the entire extended supply chain in order to support the demands of the global supply chain. Retailers are now slowly coming to the realization that they will need to collaborate across the entire marketplace in order to support the demands of the retail omni marketplace. These retailers are dragged into the ‘new’ world of collaboration ultimately across all partners that participate in the market and we see many failed and failing retailers across the marketplace that have either failed to recognize the signs or more often than not have simply refused to recognize and embrace the collaborative practices that can help to maintain their viability. Now retailers are stuck in their legacy practices of waiting for technology and practices to solidify before choosing a path and more wrong-headed view of the importance of individualism in retail practices.




The supply chain players and partners have a distinct advantage in this new disruptive market because the supply chain went through a major disruptive re-awakening twice;


When the global supply chain came into prominence in the 80’s and 90’s. This was the first major wave that drove the supply chain into the collaborative network practices that allow them to quickly sense and respond to changing demands and disruptions in the supply chain.


During the great recession when the supply chain underwent major labor disruptions that disrupted the labor market as a result of cost reductions. This created a new focus on the third party logistics market as engineers were released by retailers and landed in the 3PL market. This move of expertise created a dearth of expertise in retailers and move of this expertise to 3PL providers.




The good news for retailers is that they can partner with their own supply chain to help in developing out the practices and capabilities that will help them to sense and respond to the disruptions that are now pummeling the market. The foundation to success in the retail market is the same formula and foundation the supply chain developed in response to the supply chain disruptions; collaboration, imagination and the extended network. The difficulty now for retailers is the need to accept the new model of collaboration to support the market.




This new or expanded model of collaboration for retailers will be a difficult change because it requires change to culture and generally accepted practices for the larger retailers. These larger retailers have spend many years focused on changes that have been proven and incremental changes that fit with their culture and practices. Now the tables have turned and the market demands sweeping changes in many ways that are so far out of the norm for these retailers that it leaves them struggling with attempts to acquire the capabilities. This is not a winning strategy though because by the time the retailer acquires and implements the new capability the market has moved on to the next two upheavals and the retailer continues to fall behind.