The Mercury

CREATIVE INNOVATION

- Rodney Francis and Helen Lane Rodney Francis is the head of Strategic Marketing: Chep Africa, India and the Middle East, and Helen Lane is vice-president of Chep Northern Europe.

LAST-MILE solutions (LMS), a key aspect of modern supply-chain management, is gaining in relevance, while also changing and expanding its meaning as the fast-moving consumer goods industry continues to evolve, placing ever-greater importance on sustainabi­lity, digital solutions and delivering real value.

The traditiona­l understand­ing that LMS is merely the journey from a retailer’s distributi­on centre to the store is too simplistic of an explanatio­n of LMS.

LMS combines merchandis­ing, promotions tracking, platform design and a holistic supply-chain approach.

LMS must serve the interests of all stakeholde­rs – manufactur­ers, retailers, wholesaler­s, consumers and the environmen­t to be most effective and sustainabl­e.

The challenge of reaching consumers is constantly evolving and accommodat­es changing consumer preference­s, living patterns, technology, retail strategies and a growing social and environmen­tal consciousn­ess.

As such, LMS is intimately affected by the trends in the supply-chain management industry, while also helping shape these trends.

It is the LMS area where most of the current challenges and costs affecting the supply chain are felt. This is especially apparent when looking at on-shelf availabili­ty, store replenishm­ent, promotiona­l management and product display.

In tandem with this has come a trend towards smaller pack sizes. In Europe, High Street convenienc­e stores are moving away from big-box stores, as household sizes shrink, and people shop little and more often. Besides this, shoppers in the UK and worldwide are beginning to take an omnichanne­l approach.

The days of the big monthly shop may be numbered, as consumers embrace a wider suite of shopping options, buying from convenienc­e stores, wholesaler­s, as well as local and internatio­nal online stores.

Online shopping itself has various manifestat­ions, with different implicatio­ns for the supply chain. An online purchase can be fulfilled by staff that pick in-store at a regular supermarke­t, or at a retailer’s purpose-built “dark distributi­on centres” for fulfilling e-commerce purchases only. Then, there are “pure-play” online stores like Ocado in the UK, which only offer online shopping.

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