A new report from Coresight Research and NielsenIQ revealed the potential for "hidden treasures" in supply chain data.
The headwinds that have swept through the global market in the early ‘20s, including inflation, the lingering pandemic, war in Ukraine, surging e-commerce demand and manufacturing backlogs and bottlenecks, continue to cause headaches for retailers and suppliers who must navigate the changed and often choppy environment. A new report from Coresight Research and NielsenIQ reveals some of the biggest challenges and identifies opportunities to bolster the supply chain at a crucial time.
The report, based on a survey of 160 major retailers and suppliers across North America, shows that issues related to the supply chain play out in everyday operations. For example, 41% of respondents reported that out-of-stocks and low on shelf availability (OSA) – common drivers of consumer satisfaction and lost sales – represent a significant supply chain challenge. Backing up those responses, NielsenIQ found in its own research that the average out-of-stock rate of 7.4% led to at least $88 billion in lost sales in the U.S. retail industry from February 2021 to February 2022.
So how have retailers and suppliers coped with the problems to stem further losses? Coresight Research and NielsenIQ discovered that retailers and suppliers are increasingly sharing data for the benefit of more parties in the chain. According to the new survey, 44% of respondents are using data exchange specifically to help resolve supply chain challenges and an overwhelming 79% agree or strongly agree that data sharing has become more important than it was prior to the pandemic.
As they share data, those in the industry emphasize the importance of getting on one proverbial page. More than seven in 10 respondents indicated that having a single view of supply chain performance across the retail and supplier network is very or extremely important.
With so much churn, suppliers and retailers are also teaming up with solution providers to get deep insights and to generate one view of data. More than 70% of those surveyed said that they have worked with solution providers to better manage their supply chain.
In addition to strengthening links in their part of the supply chain, the ability to leverage data can provide other opportunities for retailers at a time when they are closely watching their margins. The survey showed that data monetization is an outgrowth of recent trends, with 36% of suppliers currently buying data from retailers they work with and 51% of suppliers planning to buy data from retailers within the next three years. According to Coresight Research, retailers can generate between 0.1% and 1.0% of total sales in data revenue and benefit from working with solutions providers to create a single insightful data stream.