URBN

Over the last few years, supply chain operations have made their way to the forefront of focus for all  verticals of company leadership. Prior to Q1 2020, supply chains had been established but the  importance had not yet been recognized. Most retail companies ran under the same transportation  principles; import via major ocean carriers, expedite imports via major bulk air freight providers,  deliver to customer via National carriers. As new challenges presented themselves between 2020  and 2023, companies pushed supply chains to get creative and level set consumer expectations.

The supply chain vertical was to be turned from a “spend only” function into a “cost optimization”  function. A few major mindset changes below lead to major advancements in the retail  transportation industry:

A successful supply chain had to be composed of building a transportation network that was consistent, reliable, creative, and diverse

• Consumers may not always want the quickest delivery option. If a consumer is given an  estimated delivery date, they want that date to be met. This mindset shift opens the door for  slightly longer (but more consistent) transits, reduced costs to both the retailer and end  consumer, and presented regional and niche carrier competition to the Nationals.

• Relationships matter! Capacity volatility lives within all silos of transportation, and price  volatility is tightly related. Gaining the edge through willingness to creatively negotiate and  create long term relationships will provide a competitive edge when capacity tightens.

• Consumers want options, so get creative. As market disruptors enter the market,  companies often avoid trying something new. Piloting services such as sea/air, same-day delivery, collection points, etc. can lead to competitive advantages and move the needle as  consumers peruse buying options. You won’t know if you don’t try!

As focus on the above grew, the industry saw a shift in transportation mindsets. A successful  supply chain had to be composed of building a transportation network that was consistent,  reliable, creative, and diverse. Although there are uncontrollable factors in this industry, the  aforementioned topics can provide risk mitigation tactics and give control back to the retailer. We’ve long followed the principle of “consumer expectation,” but have entered the era of driving  consumer expectation through consistent, transparent service and communication. We’re still in  the early stages of mastering supply chains, so early adoption of market disruptors will be at the  forefront of supply chain success stories.