The New Science of Retailing

CHAPTER FOUR

Flexible Supply Chains

How to Design for Greater Agility End to End

The logic for supply chain flexibility is compelling. Product sales are hard to predict—prelaunch forecasts of new products typically have a 50 percent to 100 percent error. So being able to respond quickly to satisfy this unexpected demand can have a huge impact on profitability. It also means that you can buy less initially, knowing you can chase winners. That, in turn, prevents margin-killing markdowns at the end of the season. Flexibility cures a merchant’s two biggest headaches: having too little of the right products and too much of the wrong ones.

This chapter describes how to create a flexible supply chain. Many apparel and shoe retailers control their ...