Abstract:
Historically, South African manufacturers and suppliers to the mass retail environment have been compelled to manage significant business risks as a result of the generic buying strategies employed by the mass retailing format. More recently, best practice initiatives such as SCOR’s collaborative planning, forecasting and replenishment have risen to the fore of supply chain management as ways to mitigate the undesired effects of theses generic buying practices for all participants in the value chain.Traditional thinking centred on optimising only the merchandise activities and function, through cost based performance measures, have caused a number of undesired effects and invalid assumptions. These factors in turn have impacted the competitiveness and sustainability of manufacturers and suppliers as well as the supply chain ecosystem as a whole. Systemic theory suggests that in order to identify these conflicting and invalid assumptions one must approach the problem through sufficiency based thinking processes that communicate the core conflict and map out possible solutions for managers. Data for this study was collected based on the widely accepted best practice framework of supply chain management for the mass retail environment. With this in mind, this research aims to provide an academic foundation for deeper collaboration between mass retailers and their vendors, as well as an understanding of the practical implications of decisions for managers and executives, on both the mass retail, and manufacturing and supply sides of the value chain.While statistical variation is a reality in the retailing environment, the mass retailing format and its supply chain partners are particularly susceptible to the negative effects of ‘bullwhip’ due to the large scale of promotional activities undertaken. Much of this problem can be mitigated through collaboration on a meaningful bases that allows not only for responsiveness for supply chain partners but greater profitability for all participant in the value chain. It is argued that an improvement in throughput will have a positive impact on the competitiveness and sustainability of the local supply and manufacturing organisations in South Africa.
