Sourcing strategies for the future

by | Nov 15, 2016 | Experts, Retailers, Solutions

More and more retailers are making the switch to cloud-based computing systems for their inventory management and other functions. Fewer of them have looked to cloud-based sourcing networks. However, many of those who have made this switch are retailers considered to be top performers in the digital retail era.

Ten years ago, even five years ago, a sound retail sourcing strategy involved a lot of travel, a lot of phone calls, and attending a lot of trade shows and special buyer-only shows. It was a busy time, and buyers spent most of their energy scrambling to find new suppliers and new product lines to keep their categories on top, taking weeks and months to bring on a new vendor.

These traditional strategies fit the old market speed of decades past, but the age of e-commerce has sped up that clock. Retailers need a more dynamic method of adding new suppliers. They need speed in discovery and speed in on-boarding. The best way to do that is to work with a partner company that specializes in finding compelling products from new qualified vendors and rapidly integrating them to work with your supply chain.

What is the future of product sourcing?

The sourcing strategy of the future is shifting to the cloud. Everything is moving to digital, and happening in a fraction of the time.

Speed should be the number one goal and strategy for every retailer. The traditional methods of discovery are outdated, slow and basically hit or miss. The most successful retailers are the ones who can quickly identify the right items first – before their competitors – and then quickly onboard them to their system. Instead of trying to keep up with the competition, they’re using modern tools to make good decisions and set the standards for their industry.

Rather than going to trade shows, searching online for new products, and waiting for vendors to call or email back, you need access to them now. That can be accomplished with the help of a sourcing solution that accelerates product discovery with the cooperation of a retail network. With access to these agile solutions, most of the work has already been done for you. You can lock in the vendors within minutes so you don’t lose your edge in the market.

The SPS Commerce Sourcing solution also offers speed in negotiations. The SPS network has access to data about each potential supplier’s capabilities, so you don’t have to go through a long negotiation. We remove a lot of the friction by supplying you with the right information to seal the deal with trade partnerships.

An integrated sourcing solution with a retail network includes the benefit rapid onboarding. With existing strong community enablement capabilities, the Sourcing solution from SPS enables you to add new vendors into your system very quickly, in as little as a few hours. The entire process of discovery to the first fulfillment can be realized in a matter of days, not weeks and months.

Quality is the second goal and strategy for every company that wants to be successful in the new retail economy.

Quality is important because aligning yourself with the wrong supplier is worse than never having partnered with them in the first place. The supplier is responsible for fulfilling not just the order, but part of the customer experience in a drop-ship world. You don’t have time to partner with a vendor who said they could give you the quantities and amounts you were looking for, but don’t actually have the inventory. Or, said they can drop ship, but can’t do it at your scale. Or, could not fulfill at the speed your customer’s demand or could not integrate with your multi-channel or omnichannel program.

It’s important not to confuse fast time to value with rushing to fill a sourcing need. Speed and quality in sourcing to fulfillment can exist in the same space. A good sourcing solution like that from SPS Commerce culls through the vendors in its network and suggests only to the vendors you should actually focus on.

If you can’t get to the market quickly, your competitor will. With the shifting online retail world, it can be much easier to lose your competitive edge than in years past. A good sourcing strategy can really make a difference between being left in the dust and leading the pack in online e-commerce.

The SPS Commerce Sourcing and Fulfillment solutions, as well as the Retail Network, will help you quickly find the vendors who can fulfill your needs at scale. If you would like more information, please contact an SPS representative or request a free demonstration.

Wael Mohammed
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