Retail Communication Is A Key Component For Retailers Implem ✓ Solved

Retail communication is a key component to retailers implement

Retail communication is a key component to retailers implementing the merchandise management process. In a short paper, answer the following questions: Discuss the role that manufacturers play in determining a retailer's success. How can placing frequent, small orders and last-minute emergency shipments negatively impact the retailer's relationship with manufacturers? What kind of merchandise replenishment practices should the retailer use to encourage a positive business relationship with manufacturers?

Paper For Above Instructions

In the dynamic landscape of retail, communication is crucial for effective merchandise management and overall success. This paper discusses the significant role that manufacturers play in a retailer's success, examines the negative repercussions of frequent small orders and emergency shipments on retailer-manufacturer relationships, and suggests optimal merchandise replenishment practices that can foster positive partnerships.

The Role of Manufacturers in Retail Success

Manufacturers are vital organizational partners in the retail ecosystem, as their processes significantly influence a retailer's ability to offer high-quality products that meet consumer expectations. First, manufacturers ensure that goods are produced to the specifications and branding that retailers desire, directly affecting inventory and sales (Harrison & Van Hoek, 2011). In fact, the quality of the products and the reliability of the supply chain managed by manufacturers can bolster a retailer's reputation and customer loyalty (Homburg, Müller, & Klarmann, 2011).

Moreover, manufacturers often provide marketing support, training, and promotional materials that assist retailers in effectively selling their products. This collaboration can enhance product visibility and drive sales. Furthermore, manufacturers’ ability to innovate can influence retailers’ competitive edge, enabling them to attract a broad customer base (Kumar & Steenkamp, 2007).

Impact of Small Orders and Emergency Shipments

While flexibility in ordering can seem advantageous, placing frequent small orders and initiating last-minute emergency shipments can negatively impact relationships with manufacturers for several reasons. These practices increase operational complexities and costs for manufacturers, who may need to interrupt regular production schedules and prioritize urgent orders over more efficient bulk orders (Ellram, 1991). This disruption can lead to decreased efficiency and financial strain for manufacturers, creating tension in the business relationship.

Additionally, constant small orders may signal to manufacturers that a retailer lacks planning or forecasting capabilities. This perception can undermine trust and create an atmosphere of uncertainty, as manufacturers may be hesitant to invest in promotional support or product innovations that require a stable partnership (Lusch & Vargo, 2014). The resulting strained relationship can affect product availability and pricing, ultimately harming the retailer's business performance.

Merchandise Replenishment Practices

To cultivate a positive relationship with manufacturers, retailers should incorporate effective merchandise replenishment practices. One such practice is utilizing advanced inventory management systems that facilitate demand forecasting. Retailers can use historical sales data and market trends to anticipate product needs, which enables them to place larger, more predictable orders (Chopra & Meindl, 2016).

Moreover, retailers can collaborate with manufacturers on joint planning and forecasting. This collaboration ensures alignment between production capacities and retail demand, enhancing overall supply chain efficiency (Benson & Richey, 2017). By sharing relevant data, both parties can collaboratively strategize to optimize inventory levels, reducing the need for last-minute orders and improving service levels.

Furthermore, establishing vendor-managed inventory (VMI) agreements can also foster better relationships. In a VMI scenario, the manufacturer assumes the responsibility of managing inventory levels at the retailer's location, ensuring appropriate stock levels are maintained without burdening the retailer with day-to-day inventory management (Guajardo, Cárdenas-Barrón, & Ríos-Mercado, 2015). This arrangement not only reduces stockouts and excess inventory but also strengthens collaboration between retailer and manufacturer.

Ultimately, effective merchandise replenishment practices rooted in collaboration, communication, and technology can empower retailers to build stronger manufacturer relationships, resulting in mutual success.

Conclusion

Manufacturers hold a crucial role in a retailer's success through product quality, marketing support, and innovation. However, practices such as frequent small orders can jeopardize these relationships, leading to increased costs and loss of trust. To foster positive interactions, retailers should adopt robust inventory management practices, engage in collaborative forecasting, and consider VMI agreements. By doing so, retailers can not only improve their operational efficiencies but also create a thriving partnership with their manufacturers, ultimately benefiting their business and customers alike.

References

• Benson, A. D., & Richey, R. G. (2017). The Role of Suppliers in Retailer Relationships: A Marketing Perspective. Journal of Retailing and Consumer Services, 36, 184-194.
• Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operations. Pearson.
• Ellram, L. M. (1991). Supply Chain Management: The Industrial Organization Perspective. Production and Inventory Management Journal, 32(3), 25-30.
• Guajardo, J., Cárdenas-Barrón, L. E., & Ríos-Mercado, R. Z. (2015). Vendor Managed Inventory: A Coordination Mechanism for Supplier-Retailer Collaboration. Computers & Operations Research, 55, 142-153.
• Harrison, A., & Van Hoek, R. (2011). Logistics Management and Strategy: Competing Through the Supply Chain. Pearson Education.
• Homburg, C., Müller, M., & Klarmann, M. (2011). When and How Should Manufacturers Support Retailers? Journal of Retailing, 87(2), 188-215.
• Kumar, N., & Steenkamp, J. B. E. (2007). Private Label Strategy: How to Meet the Store Brand Challenge. Harvard Business Review Press.
• Lusch, R. F., & Vargo, S. L. (2014). Service-Dominant Logic: Premises, Perspectives, Possibilities. Cambridge University Press.
• McCormack, K., & Valcik, N. (2010). Driving Supply Chain Performance: The Role of Third-party Logistics and Marketing. Journal of Supply Chain Management, 46(4), 31-40.
• Sezen, B. (2008). Relative Effects of Design, Management, and Logistics on Retail Supply Chain Performance. International Journal of Retail & Distribution Management, 36(6), 456-474.