Editor choice

Editor’s Pick: 8 Supply Chain Planning Challenges Retailers Will Face in 2022 and Tips for Overcoming Them

Note: Today’s post is part of our ‘Editor’s Picks’ series in which we highlight recent posts from our sponsors that provide supply chain insights and advice. This article comes from Asena Denizeri & Anil Gurbuz of Solvoyo and examines the challenges of supply chain planning for 2022 and beyond.

Since the start of the Covid-19 pandemic in 2020, the world has been facing supply chain issues. It’s no surprise for customers to walk into stores with empty shelves or for businesses not to receive deliveries from overseas suppliers. As we welcome 2022, we also welcome new supply chain challenges. Here are the challenges retailers could face in their supply chain operations in 2022 and some tips for overcoming them.

Insufficient materials to meet customer demand

At the start of the pandemic, we saw an increase in demand (hoarding!) for toilet paper, pasta, canned goods and disinfectant sprays. As we progressed with the pandemic and working from home became a reality for the majority, the demand for home office devices like webcams and microphones increased. Then, as we slowly started to get outside and get used to the new normal, people realized that public transport was not the best option due to virus transmissions, which increased the demand for cars.

Luckily, those supermarket zombie apocalypse movie-like scenes are over; but demand uncertainties like a sudden increase or decrease will continue in 2022. It is not easy for businesses to cope with sudden increases in customer demand without agile planning capabilities. In addition, there are disruptions in the manufacture of parts and the supply of raw materials. Leading to long delays, shortages, higher prices and complications in transmission lines.

The ongoing chip crisis since last year, affecting more than 100 industries, is the best example of this: supply could not meet the increase in demand, which led to higher prices and shortages of computers, cars and virtually all other electronic products with chips. As we saw in 2021, companies have automated and integrated supply chain planning capabilities, including demand sensing, dynamic safety stock management, inventory optimization and collaboration external. Having end-to-end visibility will allow them to more effectively manage their supply chains in the face of uncertainty, avoid stock-outs and keep their customers happy.

Changing lifestyle trends and impacts on fashion retail

Almost everywhere in the world, ever-changing lockdowns and curfew times have been a reality for customers in 2021. While we can’t go back to that time (hopefully!), this experience has changed our how we dress and exercise. We stopped going to the gyms and favored outdoor activities or exercises at home. Many of us have tried at least once to keep up with the most watched home cardio workout video on Youtube or have taken our first run around the neighborhood.

In 2022, the stars of the fitness world are still outdoor sports and home workouts. While the growing demand for home exercise equipment has also accelerated the expansion of the online wellness industry. We have seen an increase in mobile wellness apps, online personal training, meditation and yoga workshops more accessible to everyone around the world. In the end, sportswear companies were the winners and fashion companies changed their assortments to include active and lounge collections.

Retailers specializing in business wear were forced to reevaluate their place in the new world, and many of them began to include more casual and chic styles for their customers. With changing preferences and new ideas being tested, adopting a test-read-react approach to assortment planning, using advanced analytics and AI/ML technology for forecasting, and changing the way they order and interact with their suppliers to minimize risk remains a must for fashion brands. As many retailers will seek to source locally, reassessing their sourcing and logistics networks to optimize their supply chains will be more critical than ever.

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