Few markets feel the pace of change the retail industry must endure in response to consumer trends and sentiments. Given the industry’s traditionally thin margins, retailers struggle with finding out-of-the-box opportunities to:
- Reduce corporate overhead and store operating costs
- Increase the speed of opening new physical store locations or web-based capabilities
- Attract early adopter consumers to drive the market and increase profits
Outsourcing emerged as a viable alternative in the 1990s, with many large firms spinning off a delivery arm to practice the new trade through that decade.
However, retailers, although highly competitive, tend to only trust those who know their game. Thus niche service providers have emerged to provide proprietary industry software and services specific to the retail industry. According to the report, proprietary software and services were the norm in the retail industry throughout the last decade, as if implementing off-the-shelf applications and tools would reveal their inner workings and thus give away the keys to their commercial secrets.
Leading retailers have somehow evolved over the last 20 to 30 years while operating on home grown and proprietary solutions, but the pace of change is now too rapid for that model to survive. More and more, those in the retail industry are achieving transformation without the years of planning, executing, reworking, attrition, rehiring then re-executing, by developing a sourcing strategy.
“The transformation effort is immense. It is costly in time, money and skilled resources,” says Ben Trowbridge, CEO, Alsbridge, Inc. “But it is also critical to the retailer’s ability to weather the constant changes taking place in consumer buying habits. Companies can save time and effort, as well as avoid frustration and stress on resources by seeking assistance from outside firms who have experience transforming retail organizations.”
A select group of advisory and sourcing firms already understand the pitfalls of going it alone and the benefits that come with success. Engaging a partner and taking full advantage of their industry experience allows a company to “leap frog” many of those grueling steps and get help dealing with the transformational work that must be tackled internally. An outside view and planning assistance makes it possible to land in the midst of current retail trends with a team that understands the advances in the retail industry and can move your company forward to outpace the competition.
Read the full report from Alsbridge, “The New Reality in Retail: Sourcing Trends to Create a Seamless Customer Experience.”