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FUNDING SERVICES

BMCS India > Services > Funding services > Retail & E-Commerce

What challenge(s) do our clients face?

Retail is a complex and fast-paced business undergoing a major transformation creating new opportunities and challenges. The retail business environment is undergoing a major transformation – new consumer habits, e-commerce growth, and digital transformation are trends that are here to stay and should generate profound changes in this industry. The customer journey will be completely reshaped, channels will change, Stores will change their role completely. While Retailers are being pushed to rethink their business, it’s important to bear in mind that the essence of Retail remains the same – the tools available and market competence are being completely reshaped, but companies should not lose sight of the basic principles that have always guided them: Provide the best experience for the customer: assortment, services, pricing, product availability, … Keep the cash conversion cycle and profitability under control: retail is a complex environment with typically narrow margins. Managing hundreds of thousands of SKU’s on hundreds of inventory points, buying from hundreds of suppliers and selling to hundreds of thousands of clients it definitely not an easy task React fast: This is a fast-paced business. Retailers are the last link to end consumers. This proximity, combined with its gigantic figures, creates an environment that requires pragmatism and speed of action to outlast.

How do we help?

In Retail’s fast-paced and results-driven environment, all solutions must provide short-terms impacts in order for any initiative to last, granting funding for the long-term transformation

We’ve had the great privilege of working alongside dozens of retailers striving to improve their company competitiveness and profitability. Our approach has been developed with hands-on, coping with the retailer of all types, sizes, and scales for more than 25 years.

Whether to improve on-shelf availability, optimize the assortment, or reduce expenses, our approach in Retail is geared towards business transformation. As solutions are thought out, they are tested in practice on pilots, on the company’s day-to-day activities, which feedback into the design, generating results, movement in the organization, and enabling the client’s team to learn on the job the new solutions and ensuring sustainable results. Transformation takes place in the daily life of the company!

COMMONLY APPLIED SERVICES

  • Entry Strategy and Value Proposition: How to establish a model for serving the market, leveraging revenue and profitability and improving efficiency, in line with both the company strategy and the needs of consumers
  • Category Management: Translation of consumer behavior insights into business intelligence that drives assortment, display, promotion, and pricing models.
  • Out-of-stock & Inventory Transformation: End-to-end optimization of retail replenishment back-bone, from merchandising to store operations and Supply Chain processes, systems and governance model
  • Cost-Efficiency: Identifying levers for cost optimization through a broad and deep business diagnosis
  • Footprint Expansion: Helping companies establish a solid foundation for consistent, sustainable organic growth – structuring processes, ensuring visibility, control, speed, and alignment among areas
MARKET ENTRY STRATEGY
CATEGORY MANAGEMENT
EFFICIENCY & COST REDUCTION
RETAIL SUPPLY CHAIN
RETAIL FOOTPRINT EXPANSION

SUCCESS STORIES

CHALLENGE

One of the largest grocery chains in Brazil, with over 50,000 SKUs and 300+ stores had suffered from out-of-stock problems for nearly a decade. The company had been dealing with a stark contrast between either severe OOS inventory or excess inventory.

APPROACH

Through the completion of a comprehensive diagnosis of the causes of out-of-stock and overstock, it was clear the client required a complete turnaround of their Supply Chain, with a focus on inventory and breakdown for both FMCG and non-food goods.

With this in mind, we implemented a new organizational structure, a set of new inventory policies per channel (Direct store x Cross Docking and Stock), and re-designed supply routines/processes. With a strong focus on change management, we ensured the new methodology was tested in some pilot categories for 4 months, allowing for time to embed the new ways of working and to address any unforeseen problems.

We also introduced a new vendor relationship reward program that fostered better relationships between this retailer and industry suppliers, which today is highly known and recognized in the Brazilian market.

RESULT

The work resulted in a -70% out-of-stock rate reduction, achieving the lowest historical rate ever, and reducing inventory levels at the same time (-5%), resulting in a significant increase in margin, and ultimately delivering the company’s annual target results. The team was also restructured reducing head-counts though a higher degree of automation.