A retail supply chain is a very complex dynamic system that requires innovation in all instances to match the changing ways of the customer. Various drivers like country-specific politics, trade laws, international relationships, and quality control influence it. Moreover, the invasion of e-commerce giants like Amazon has drastically changed the retail industry and created problems in supply chain optimization.

The challenges that most retailers face, including those based in Saudi Arabia, are omnichannel complexities, inventory visibility, high labor costs, disparate systems, surge in orders, customer expectations, fulfillment model inexperience, compliance, operational inefficiencies, slim profit margins, and the changing dynamics of the different types of retail establishments, including local corner stores, department stores, shopping malls, chain stores. 

Therefore, retailers are continuously looking for opportunities to refine their supply chain. As an end-to-end supply chain solution provider, TrueCommerce can help retailers overcome such challenges. With next-gen technologies and smoothening of processes, TrueCommerce helps retailers get more visibility of their inventory, minimize inefficiencies in operations, try newer models of fulfillment, maintain compliance, and at the same time, improve the profitability of the retailers in different retail formats.

Tight Profit Margins

The Saudi retail sector faces difficult times in holding profit margins, much the same as other international retail sectors. Consumers tend to be very sensitive about prices, and online price comparisons give customers the power to squeeze retailers for competitive prices, thereby making it hard to sell products to customers at higher prices to increase profit margins. In addition, increases in raw material costs, overheads, and operations further squeeze retailer profitability.

Attention is now being turned to other practices geared toward smoothing operations and thus cutting costs. These include the integration of back-end systems—like ERP—and efficient collaboration with trading partners. Effective customer communication across multiple channels, from brick-and-mortar to web-based, app-based, and social, forms the very basis of winning and retaining customers. TrueCommerce offers order processing solutions, centralized inventory management, ERP integration, and multichannel communication. Adopting this sort of technology or strategy could be pivotal in enhancing profitability amongst retailers within the retail market.

Meeting Customer Expectations

Customers in Saudi Arabia are becoming more demanding nowadays. They want the best quality goods at the lowest possible prices. In addition, customers expect a wide range of product options and availability across channels, partnered with good customer support. It is these diverse customer expectations that have pressured the retail supply chain to satisfy the needs of their customers. They should provide a greater variety of stocked goods that include seasonal ranges and assortments to keep their customers satisfied. Also, they need to make such products available to customers in different markets and channels on time.

Retailers can implement automated EDI solutions to smoothen their supply chain operations. EDI automation is supportive of the compliance of EDI standards, improved order fulfillment, enhancement of customer satisfaction, and accuracy in orders. It caters to more modern EDI needs, like buy-online-pick-up-in-store options and other inventory management strategies. Using data feeds allows for deep integration and seamless communication between distribution centers and brick-and-mortar stores, enabling retailers to resolve compliance issues, improve profitability, avoid fines and penalties, and attain payroll savings. With TrueCommerce solutions, retailers will be able to scale their operations by integrating the most vital channels for supply chain optimization, such as ERP systems. 

Operational Inefficiency

Operational efficiency can be a challenge in the Saudi retail sector due to a lack of vision across key business departments and silos of information within each business unit. It is for these various reasons that companies normally seek the help of the latest ERP systems since traditional spreadsheets cannot keep up with retail operations demands. This is where operational efficiency will be affected by reliance on static spreadsheets, increasing errors.

Operational efficiency in the retail supply chain can also be driven by integrating data analytics to track demand and monitor the inventory level. Omnichannel retail strategies involve letting the consumer get a smooth buying experience from in-store to online to social media, apps, and marketplaces. System integration is a critical component of real-time tracking of inventory and fulfillment issues. The smoothness of the process and high efficiency can only be achieved if investments in technologies, like an ERP system, are in place. In that matter, the training of employees is quite important to enable them to learn about the necessary skills required to operate the technologies. Besides, the quality data availability and building good communication channels with trading partners, are the other two key elements of optimizing the retail supply chain.

Quality & Compliance

Brand name, point of origin, quality marks, customer feedback, and online reviews show the quality of the product. Now, brands have to meet certain criteria rather than just claiming it for their product’s quality. Also, the retailers have to remain in conformity with government regulations and consumer body policies that enforce the rate of quality to be higher.

The pandemic has brought about several challenges and disruptions to the retail sector by way of delays, supply chain disruptions, and changes. More recently, some of the most powerful drivers of supply value and overall quality have been alterations in geopolitics and global logistics chains. Growing customer demand, increasing concerns around sustainability, and efficient B2B and C2B logistics are some of the many changes in the landscape. The challenges of steering clear from the problems and mastering the opportunities for growth and innovation depend on a retailer’s ability to leverage technology and adapt to changes in the future. With the elimination of delays, disruption handling, and embracing technology, retailers can optimize their supply chains to suit the ever-changing needs of customers.

Omnichannel Integration

The brick-and-mortar store is no longer the only place where consumers can buy goods. Consumers have multiple channels, and at least they shop from three channels on average. Logistics and flow of goods from each of these channels will incur different costs and have a varying delivery schedule. The problem in the retail supply chain arises when retailers have to maintain consistency across product offerings, quality, and customer experience. This will have to be done at a strategic level because it involves optimizing inventory management and orders for retailers, as well as changing the way business is conducted.

Overcoming Saudi Retail Supply Chain Challenges with RefroTech

The Saudi retail supply chain is riddled with tight margins, high expectations of consumers, inefficiencies in operations, and needs in terms of quality and compliance. To overcome this retailers will need to innovate and adapt advanced technologies in a bid to lift themselves out of their current predicament. RefroTech offers comprehensive solutions regarding the smoothing of supply chain operations, enhancing inventory visibility, integration of the ERP system, and ensuring compliance with regulations. By opening up the expertise of RefroTech and its state-of-the-art tools to any entity, one can very well experience efficiency, improvement in customer satisfaction, and a lead over others in the ever-dynamic Saudi retail market. RefroTech’s end-to-end support empowers retailers to navigate complexities and drive sustainable growth.