04/22/2024
7 Steps for Using Data to Improve Retail Consolidation
Good information is central to consolidating your shipments, reducing costs, and strengthening retail relationships. Discover how data can revolutionize how you work with retailers.
Retail consolidation services (RCS) are a great way to reduce your costs and optimize how you deliver to big-box retailers. Getting RCS right depends on having access to wide-ranging, reliable, and timely data. In this guide, we'll break down how an RCS provider might work with you to use your data and improve deliveries to retailers.
Let's get into it.
Key takeaways
- Good data is central to strengthening relationships and working better with retailers
- Retail consolidation services use data to understand how brands, carriers, and retailers can optimize their delivery operations
- An RCS provider works with your brand to understand your data and build the right RCS model for your consolidated shipping needs
- These models will be continually refined and improved to optimize cost savings, speed up deliveries, and avoid retail penalties and fines
Step 1: Understand why it's important to use data to improve retail consolidation
Retail logistics is a very data-driven industry. Brands, carriers, retailers, and 3PLs use data to predict and measure supply, demand, capacity, and operational needs. Access to strong, verified data means that we can build accurate forecasting models that optimize availability and efficiency. Data can also identify where things are going wrong, driving investigations that solve problems and manage risk.
Retail consolidation services benefit from data in several ways:
- Understand the balance between vendor supply and retailer demand
- Forecast and adjust to likely future demand through regular and peak seasons
- Track important KPIs for retail delivery such as on-time in-full metrics
- Ensure that 3PLs and retailers have enough storage space to handle inventory
- Optimize carrier loads, drivers, and routes to keep costs down
- Identify bottlenecks and delays that can lead to retailer fines
Step 2: Establish what data is available from your brand
At the beginning of a retail consolidation partnership, 3PLs will collaborate closely with brands to determine what information is available. This will help the RCS provider to customize consolidation programs that work for your products and the retailers you do business with. Data can be classed into various categories, examples of which include:
- The main retailers and geographies that you work with
- A list of your products, variants, and SKUs
- Likely changes to supply, demand, and capacity throughout the year
- Growth plans, new product launches, and promotions
- Materials and handling requirements for products
- Any special considerations or requirements between you and your retailers
- Any established carrier or other third-party agreements
Step 3: Compile and review your brand's retail data
Once a 3PL understands what information is available, they will work with a brand to collect, verify, and validate data. These metrics will cover areas such as:
- Product quantities and weights to each retail distribution center
- Order fulfillment and lead times across products and retailers
- Frequency and timing of shipments to retailers
- Current performance against retail service-level agreements (SLAs) and KPIs
- Density and class information for each product
- Forecasting and seasonal variations for supply and demand
- Expected growth rates affecting the demand for products
A 3PL will request at least a year's worth of historical data, and may go back further than that to develop predictive models for future demand. They will then go through a verification and validation exercise to ensure high-quality information.
Solid and proven data will help you and your 3PL to make smart, informed plans and decisions. These decisions can boost profits, manage risks, and challenge retailer penalties and fines.
Step 4: Establish the right RCS model
3PLs have several ways that they can provide retail consolidation. They will take all of your data into account and consult with you on the right consolidation model. This will include:
- Ideal routes and preferred carriers for the retailers you are working with
- Special retail requirements and how RCS can help you to meet each one
- RCS pricing models based on your needs, from pallet-based pricing to LTL and tariff pricing
- Service-level agreements and KPIs that meet the needs of your brand, retailers, carriers, and more
- RCS programs and Standard Operating Procedures that can be optimized for each retailer
Step 5: Integrate across RCS technology, people, and processes
Data isn’t static—it needs to be shared across brands, retailers, and other stakeholders. That's why an RCS provider will be careful to integrate data across various people, systems, technologies, and processes. This can include:
- Using product volumes to schedule RCS work shifts, carriers, and delivery slots with retailers
- Integrating with a retailer's and brand's order management systems to fulfill orders and deliver them on time and in full
- Working across Warehouse Management Systems (WMS) and Transportation Management Systems (TMS) to manage and track inventory at all stages
- Managing inbound and outbound logistics while minimizing delays and bottlenecks
- Analyzing data and forecasts across the end-to-end supply chain to manage supply, demand, and lead times
- Reporting on KPIs and performance against SLA targets for all parties
- Challenging erroneous fines or penalties from a retailer
Step 6: Tweak and adapt RCS programs and data in line with changing brand and retailer needs
Retailers and brands change their priorities in line with marketplace needs. An RCS provider will track shifts in the marketplace and the likely impact on retail operations. As retailers update their requirements, a 3PL will update consolidation programs to meet the new specifications.
Step 7: Review performance and make continual improvements to retail consolidation services
Finally, in-depth data analysis allows RCS providers to continually improve their offerings. From close KPI tracking through to strategic business reviews, strong data allows you to collaborate with your logistics provider. This collaboration supports smarter decision making that removes inefficiencies, ensures everyone works together, and maximizes your profitability.
How GEODIS can help
GEODIS is one of the biggest retail logistics and RCS providers in the U.S. and around the world. Here's what you can expect when you work with us:
- A leading on-time, in-full rate of 98%
- Strategically located warehouses and distribution centers throughout the U.S.
- Reach 99.5% of the continental U.S. in two days or fewer
- Strong relationships with major big-box retailers
- A wide and deep national, regional, and local carrier network
- Best-in-class retail consolidation services
- Standard operating procedures to meet retailer guidelines
- Complete quality control and auditing of all retail shipments and products
- Integration with the full range of transportation, warehousing, and freight forwarding GEODIS services
- Real-time visibility throughout the supply chain
Delight retailers by choosing GEODIS as your 3PL partner. Get in touch with us to discover how we can optimize your data to enhance your retailer deliveries.