Retail 2020

Over the past decades, actors in retail supply chains have fundamentally restructured and industrialised their operations restructuring production facilities, warehouses, distribution centres and shops into high volume, centralised systems based on principles of scale economics and low unit cost. Currently, we are seeing a major change in the competitive environment of the sector – with shifts in consumer power and behaviour, and in the strategies used by the supply chain actors for stimulating demand. Customers are demanding customisation of services and products. In addition, alternative sales channels like online shopping are gaining popularity, often combined with home delivery and services accompanying the physical product. Consumers prefer freedom to buy products from any location at any time, as well as a broader variety of both standard and niche products such as organic, local and specialty food products. A growing variation in customer segments can be observed, as well as increased demand variation caused by the actors themselves through bonus and discount mechanisms such as loyalty cards and 3-for-2 offerings.
These developments will have large implications for retail supply chain actors as producers, wholesalers/distributors, retailers and transport providers, face a major challenge related to how logistics should be performed. While the current logistics systems are designed to handle large product volumes efficiently – there is a growing need to manage increasingly complex product flows and a mix of large and small order sizes and volumes, delivered to more segmented markets.
The focus of Retail Supply Chain 20202 is on the food sector due to the specific challenges that the product characteristics impose on logistics; e.g. time constraints due to perishability, seasonality, and demand variability.
The overall objective of Retail Supply Chain 2020 is: To develop knowledge, concepts, models and methodologies for differentiated and efficient product and information flows in supply chains where new demand and shopping patterns are emerging.
In order to achieve this objective, a number of sub-objectives have been defined:
1. Strategies for differentiated logistics and a concept for new business models and product-based services, including guidelines for development of logistics systems.
2. A generic Control Model for real-time and differentiated operations of retail supply chain supported by e-based methodology for model development and implementation.
3. A knowledge platform and guidelines for application of ICT technology, architectures and models for collaborative systems, seamless and transparent interfaces.
4. A methodology for competence building and change management program for the new generation managers and operators in logistics.

The project is funded by the partner companies and by the Research Council of Norway in the period 2014-2017.