PARK CITY, Ut. – July 15, 2009 – Park City Group, Inc. (OTCBB: PCYG), Chairman & CEO, and co-founder of Mrs. Fields Cookies, Randall K. Fields recently discussed the trends he sees emerging around trading partner collaboration, and the importance of a common goal in improving the consumer experience. He sees the way to that common goal in Consumer Driven Sales Optimization™, a strategic business process designed to maximize all components of the supply chain, beginning with the consumer.
Collaboration is not a new idea. Industry associations, analysts, retailer and suppliers have all been promoting the idea for years. But where the industry has fallen short is in the execution. Commonly, retailers view suppliers as mere ‘manufacturers’, while suppliers view retailers as a distribution channel for their products. The RSR Research 2008-2009 Benchmark Report has found that 85% of suppliers and 100% of retailers are willing or extremely willing to collaborate with their trading partners, but that the biggest challenge to collaboration is visibility into the entire supply chain.
Consumer Driven Sales Optimization™ provides that visibility to both retailers and suppliers by acting as an independent, third party who assists in optimizing inventory and sales for the wholesaler/retailer and supplier. A shift towards this type of model is inevitable, and Mr. Fields sees this renewed emphasis on collaboration resulting in a three step process suppliers and their retailer partners will end up adopting to reach true collaboration.
Step 1: Sharing Critical Supply Chain & Point-of-Sale (POS) Data
In an age where many companies are still dependant on manual processes, the current market shift towards technology has opened the door for the increased sharing of daily consumer activity from retailer to supplier through POS data. This POS data provides crucial knowledge so suppliers can accurately forecast based on consumer demand and retailers can gauge progress against goals. But this influx of data begs the question on both sides, ‘How can I use this data to improve my consumer’s experience, and ultimately my bottom line?’.
Step 2: Aligning the Trading Partners through Collaboration to Achieve Strategic Goals
The new information gained from data sharing and analysis can lead to an alignment of supplier brand strategy and retailer merchandising strategy. Supplier forecast and promotion plans can be aligned with retailer product strategy around new products, pricing, and promotions leading to a collaborative relationship where all parties plan with the consumer as the ultimate customer. With a common goal as the driving force, this collaborative relationship will allow for increased visibility, a quick response to demand and better business.
Step 3: Using Collaboration to Prevent Out-of-Stocks
Successful collaboration of trading partners allows for a new business strategy: proactive vs. reactive. When you can anticipate consumer demand through more accurate forecasting and planning, the result is intelligent market execution, leading to decreased out-of-stocks and optimized inventory levels. Retailers on average see out-of-stocks hover around 7%, which equals lost sales for both retailer and supplier that can total in the millions.
“Consumer Driven Sales Optimization creates an alignment of interests for the retailer and supplier, by starting at the most important point in the supply chain, the scan.” commented Mr. Fields, “this focus on effectiveness vs. efficiency means an emphasis on better assortments, in-stocks and at the shelf performance. All of this provides a noticeable difference to the consumer.”
For more information on Consumer Driven Sales Optimization™, visit www.parkcitygroup.com.
About Park City Group:
Park City Group is a trusted business solutions and services provider that enable retailers and suppliers to work collaboratively as strategic partners to reduce out-of-stocks, shrink, inventory and labor while improving profits, efficiencies, and customer service. Our innovative solutions provide trading partners a common platform on which they can capture, manage, analyze and share critical data, bringing greater visibility throughout the supply chain, and giving them the power to make better and more informed decisions. For more information, go to www.parkcitygroup.com.