Oracle Retail Solutions: The Sentient Retail Supply Chain

Retail has experienced seismic shifts, both from a macro and industry structure perspective, and even more changes are ahead. 21st century customers' expectations and supply-side dynamics will have profound impact on the retail supply chain. In this new operating environment, retailers that emerge as leaders will have transformed their supply chains beyond the reactive, linear models of the current era– to a model that is flexible, intelligent, aware of real-time changes and better able to predict product demand. Taken together, these four qualities define the operating principles of the Sentient Supply Chain: a supply chain that is capable of making optimized decisions for the business, and dynamic enough to support a multi-faceted retail operation in an increasingly globalized marketplace.

The globalization of retail has produced some natural roadblocks for retailers who are not prepared to plan and react deftly. Specifically, three macro trends are deeply impacting retailers from an operational and market perspective: Worldwide demographic shifts are opening doors for retailers who react quickly, and are posing major risks for those that stand by and do nothing; Falling trade barriers are creating opportunities for retailers to source product in parts of the world where production is significantly less expensive; Geopolitical uncertainties and a shifting world order in the post-cold war era have created unstable conditions in consumer and commodities markets.

Structural trends also are playing a primary role in molding the new supply chain: the value retail store formats are dominating the playing field by creating super-efficient supply chains while closing the perceived quality gap in customers' minds; channel blurring and SKU proliferation are making it harder than ever for retailers to differentiate themselves from competitors, and have overwhelmed the consumer.