According to A.C. Nielsen, DSD represents 24% of Sales and 54% of profit for grocers. 77% of retailers expect DSD to "increase or remain constant" in the years to come.
And yet, a GMA study released in February 2011 indicated that 50% of retailers never share POS data with their suppliers, and only 23% share data "consistently". 43% of suppliers complain that they spend less time merchandising than they'd like because they're waiting to be received; the same study reports that a staggering 70% of suppliers are spending less time on merchandising than would be optimal because of a combination of receiving challenges, return handling, invoice reconciliation and communication challenges with stores.
As we are approaching 2012 and beyond, no retailer who wishes to become or remain a leader can afford to relegate DSD to the last-in-line, afterthought mentality that has prevented progress for so long. And no supplier wishing to remain a preferred vendor can stand in the way of progress in order to protect some intangible advantage borne out of outdated traditions and business practices.
Any retailer who accepts minimal visibility as inevitable, shares little or no information, and ties up its DSD suppliers with procedural red tape, will underperform and under-serve its customers.
Any supplier who refuses to be a partner in the process of reducing waste and maximizing sales through scan-based-trading and real-time transparency, is clinging to the "best practices" of the past and will soon find itself trailing nimbler, more progressive-minded suppliers.
Assisted by iControl's one-to-many SaaS tools and support, retailers and DSD suppliers can finally become truly-aligned business partners.
For many retailers, DSD remains an area of the business that is largely vendor-managed, with minimal oversight and input from the retailer's merchandisers. Even the best merchandisers are hamstrung by limited visibility and aged information. While many suppliers are doing their very best to provide good service, the fact remains that without an engaged and empowered merchandiser providing oversight and guidance, vendors will inevitably be tempted to focus first and foremost on their own interests.
A supplier who is self-managed may be less inclined to pull the plug on an underperforming SKU, ramp-up supply on a hot seller (potentially by having to scale back supply to less-engaged clients; are you one of them today?), and schedule replenishments on the basis of a combination of the retailer's needs and scheduling, versus the supplier's own scheduling priorities exclusively.
iControl has developed a powerful platform to meet the unique challenges of DSD categories. Offered in the form of SaaS, out platform features groundbreaking and user-friendly analytics, providing trade partners a shared opportunity to make highly-informed decisions, based on a single, undisputed version of the truth.
Empowered by timely information presented in a highly actionable format, our retailer and supplier clients are able to minimize waste and maximize sales by:
Right-sizing DSD inventories
Optimizing SKU selection
In a part of the business that has traditionally been operated with too little collaboration and very little visibility, iControl provides the first and only truly comprehensive solution to achieve substantially better results.
At iControl, we help you see what you need to see, so you can do what you need to do!
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