Traditional key selling points of the direct store delivery (DSD) model are quicker distribution, increased flexibility and reduced out of stocks. However, the direct store delivery model has been facing competition from alternative distribution options recently, so now is a good time to examine how the model can evolve to meet present day challenges, such as the increasing price of transportation, labor and warehouse costs.
In an article in Consumer Goods Magazine, Dr. Ramin Shariat-madari of Accenture CAS recommends that DSD companies need to establish processes that offer more than “excellent DSD logistics only”. “DSD processes that effectively combine the capabilities of logistics with sales and marketing will play a much more relevant role in the future.” Companies must understand consumption behavior at a point of sale level, and anticipate the appropriate set of products to be placed in store and the relevant service level.
Shariat-madari points out three capabilities growing in importance to DSD providers:
· Greater understanding of downstream information
· Improved leverage of downstream information
· Enhanced ability to react effectively and quickly
Source: Consumer Goods
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