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Black Friday challenge - what's the answer?

25 November 2016

Black Friday is relatively recent introduction to the UK’s retail calendar and while the front end of retail - the sales teams, the marketing bods, the merchandisers are no doubt rubbing their hands with glee – at the operations end it simply represents a massive challenge.

Indeed according to a report from supply chain consultancy LCP, many retailers are now waking up to the reality that it might not be such a great idea after all, because while the sales do surely flow in, so do the costs associated with selling so much merchandise in singles, and delivering them direct to the customer rather than to those old fashioned things that in the old days we used to call ‘shops’.

As Stuart Higgins, retail partner at LCP succinctly summarises: “Profit during Black Friday is not driven by sales increases; it is driven by the additional operating cost and the complexity of managing operational peaks.”

Its survey found that most UK retailers find Black Friday ‘margin erosive and unprofitable’. And yet most retailers, save perhaps a few such as Asda, cannot resist participating.

Separate undercover investigations have highlighted how difficult it can be keep food delivery vans clean while running a fast and lean operation. The BBC also raised concerns that some third party couriers delivering for Amazon were expecting too much from their drivers and paying them too little.

These challenges place pressure on the supply chain to improve efficiency. One way this can be achieved is through the intelligent roll-out of automated solutions. I enjoyed visiting Pharmacy2U in Leeds earlier last month, true, the online pharmacy does not operate in the the retail sphere, but the business shares many characteristics. What impressed me most about Daniel Lee, chief operating officer at Pharmacy2U was the serious and thorough approach he took to the upgrade of his automated warehouse – which was in turn absolutely key to the growth of his business. For anyone facing up to such a challenge now or in the future, this article is essential reading.

This year’s Fork Lift Truck Association Pick of the Year highlights the nominees for the prestigious FLTA Awards for Excellence, which takes place in early March. This is the highlight  of the materials handling calendar and is always  a great networking event and a night of great  fun, whether you are a winner, a runner-up or simply enjoying the atmosphere. The Pick of the Year supplement offers a great insight into the best products of the year in the categories of Environment, Ergonomics, Safety and Innovation, as well as giving companies the chance to compete for the Safe Site award, given to the company that demonstrates the greatest improvements in forklift safety in the year. The awards also laud the achievements of those who have devoted years of service to both the association and the industry. In years past, some of the categories were decided by public vote, but this year see the start of a new era of Awards decided by a Jury of industry experts, I am proud to say I will be joining the panel.