Retail logistics in the UK: past, present and future

Abstract

Paper Type: General ReviewPurpose: The purpose of this paper is to provide an overview of the logistical transformation of British retailing over the last three decades and to discuss likely challenges that face logistics managers in the future Design/Approach: Reviews the key works on retail logistics, including the research undertaken by the authors over the last 20 years. Findings:Illustrates how retailers have control of the supply chain in the UK drawing upon examples from both the grocery and fashion sectors. Challenges for the future include macro-environment issues such as climate change and recession in addition to improvements in existing in operations with regard to e-fulfilment and implementation of technologies such as RFID. IntroductionIn the late 1990s, Leigh Sparks wrote that there had been a 'logistical transformation' of British retailing in the previous decade (Sparks, 1998). At the same time John Fernie provided a review of these logistical changes, commenting that the key challenges for the future were those in relation to political, environmental and technological change (Fernie, 1997). The British Government had imposed a brake on out of town shopping developments, and along with environmental groups was seeking to improve recycling of waste and reduce 'food miles' in the supply chain. Concurrently the dot.com boom was producing forecasts of home shopping sales in Europe to account for up to 25% of overall sales (Mandeville, 2000). Fernie (1997) noted that logistics managers faced new challenges in the Millennium although the pace of change would be difficult to predict. Together John Fernie and Leigh Sparks have produced 3 editions of Logistics & Retail Management since the late 1990s; each edition has involved a considerable re-write to accommodate changes in the retail supply chain , 2009).The purpose of this paper is to shed light on the 'logistical transformation' of British retailing during the last three decades. The paper discusses the key logistics concepts and their application to the retail supply chain, prior to dealing more specifically with changes both in the grocery supply chain and fashion logistics. A section is then devoted to the development of etail logistics before 4 finally, a discussion of likely challenges that logistics managers will face in the future is provided. Retail Logistics and Supply Chain TransformationRetailers were once the passive recipients of products, allocated to stores by manufacturers in anticipation of demand. Today, retailers are the controllers of product supply in reaction to known customer demand. They control, organise and manage the supply chain from production to consumption. This is the essence of the retail logistics and supply chain transformation that has taken place during the last 20 to 30 years. Major British retailers have been faster to adopt these technologies than 6

The use of ICT in road freight transport for CO2reduction – an exploratory study of UK’s grocery retail industry

“…Many such initiatives are driven or enabled by developments in ICT. As a result, logistics in British grocery retail is claimed to be among the most efficient in the world (Fernie et al, 2010). The food and grocery industry is one of biggest users of road freight transport in the UK.…”

An Exploration of Big Data Practices in Retail Sector

“…While store-based picking minimizes the investment and local delivery transport costs, its substitution rate is significantly higher due to the on-shelf availability. Purpose-built fulfillment centers can provide real time inventory information to customers to avoid this problem; however, they have higher transport cost especially when serving a wide geographic area [21]. One solution that takes advantage of both models is to use a fulfillment center in densely populated areas and store-based picking in others.…”

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Integrating intermodal transport with logistics: a case study of the UK retail sector

“…Distribution facilities continued to evolve, from single product warehouses to composite environments housing ambient, chilled and fresh produce, all scanned in and out using barcodes that were integrated within the IT system used for forecasting, planning and ordering (Fernie et al, 2010;Smith & Sparks, 2009).…”