Business

Retailers resort to reverse supply chain to procure goods

New Delhi: With a nationwide lockdown disrupting the dispatch of goods by FMCG companies and suppliers, some retailers have resorted to reverse supply chain mechanisms in the form of stop-gap procurement arrangements.

Grofers, Spencer’s Retail and Lots Wholesale are sending their own trucks – and workers in many instances – to bring provisions from FMCG companies and their large suppliers’ distribution centers.

The approach is a departure from the standard practice of FMCG companies that deliver goods directly to retailers’ warehouses and stores. FMCG companies typically leave about 60% of supplies in lot wholesale warehouses and the rest are near the company’s cash-and-carry stores in Thailand.

“But today we are going directly to their places and buying goods,” said Tanit Chyarvont, MD of Lot’s Hole. “We need to be watery and resilient in times of crisis.”

Since March 25, the nationwide lockout led to the exodus of hundreds of thousands of workers from cities to their hometowns, causing a severe shortage of manpower and supply chains from consumer companies to retailers.

“You don’t have a choice. Either you get your own trucks or the supply is not coming in very many places,” said Rohit Sharma, head of supply chain at Grofers. The online grocery company sold its trucks to Hindustan Unilever, Nestle , ITC, sent to buy goods from distributors of Reckitt Benckiser and also from small vendors supplying personal brands of growers.

Dabur India is supporting retailers and wholesalers.

Adarsh ​​Sharma, executive director at Dabur, said, “In some cases, we have seen retailers not providing their vehicles / manpower with stockists.”

Sharma said Dabur, which makes Real Juice and Vatika Shampoo, has established direct contact with retailers.

Bisleri, the country’s largest packaged water maker, said that it is serving consumers directly.

Between the restrictions imposed on truck movement by various states and the preference given by customers for essential commodities, retailers cut their stocks to focus on food and household items such as rice, flour, pulses, oil and sugar. is. Retail and FMCG companies are working together to streamline the supply chain for essential commodities.

Spencer’s Retail has identified “high velocity” essentials and is coordinating their production and distribution with manufacturers and suppliers.

“There are instances where manufacturers need support – we have logistics support for them,” said Devendra Chawla, CEO of Spencer Retail. “In such cases, advance slot booking system has been implemented to avoid vehicle detention and delays.”

Back to top button