Visibility into shipments fails if you look at wrong stuff, analyst says
Visibility into shipments through web-based transportation systems can make retailers more confident about controlling shipments, but inconsistent quality of data often makes it difficult to realize hard benefits, Gartner Inc. analyst Jeff Woods tells Internet Retailer.
Although increased visibility into shipments can help retailers better consolidate shipments and reduce their overall freight bills, the bigger prize—assuring that the right products get to the right stores when customers want to buy them—can be more illusive, Woods says.
“Most retailers are not able to articulate any kind of hard business case with respect to transportation visibility, because generally there is not enough compliance from shippers and carriers in providing information, and the information is not accurate enough,” he says, adding that shipment data from carriers especially are unreliable.
The lack of reliable data makes it difficult for retailers to translate shipment visibility into actions that can affect merchandise sales, for example, preventing out-of-stocks or aggressively advertising a merchandise promotion because a retailer feels assured that an expected shipment will arrive on time, Woods says. “Most retailers can’t quantify how shipment visibility helps avoid out-of-stocks because there are too many variables. Out-of-stocks are such random events, it’s hard to say what caused them and how they were avoided.”
Woods says he believes that web-based transportation management will provide quantifiable benefits over the long term. “It’s a good thing to do, and over the long term it will get better,” he says. “But the first thing shipment visibility often shows is how bad the information is.”
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