IGD’s Retail Logistics 2003 report shows how chains have gained tighter controls across the board with improvements down to better working practices internally and with suppliers.
Average non-food stocks were down from 26.3% last year to 20.5% while alcoholic drinks fell from 17.3% to 14.5%. Efficiencies were greatest in fast moving goods and frozen food with 9.6% and 9.2% average stock holdings respectively. The multiples were moving towards larger depots - Tesco’s average depot is nearly 293,000 sq ft - while in convenience depots were smaller, with Nisa-Today’s having an average 133,000 sq ft.
With the advent of factory gate pricing and increased backhauling, supplier control over distribution was likely to decrease further, with fleets possibly redeployed for the collection of raw materials and packaging. “The operation of any transport by suppliers may become too costly and instead entire transport operations may be left to third party logistics providers to complete.”