Shippers need to focus more on 'demand chains' and less on supply chains

Companies need to focus more on “demand chains” and less on supply chains if they are to keep up with the changes in retail.

This is the view of Brian Bourke, vice president of marketing at Seko Logistics, which recently partnered with bicycle manufacturer Canyon.

“Canyon made its name in Europe and the brand wasn’t that big in the US before its launch,” Mr Bourke told The Loadstar.

“But since the success of both soft and hard launches, it really has made a big push into the US market and is taking on some of the largest, most well-known manufacturers.”

Canyon claims to stand out from its rivals because of its business model: its lack of retail outlets. But to break into the US market required the right partner.

As an online retailer, Canyon is dependent on supply chain partners to make sure it can cater for its growing US demand.

Mr Bourke said: “At the beginning, Canyon was something of a novelty, but volumes are going ever upwards and having a domestic warehouse has been critical, especially in the era of e-commerce.”

The warehouse measures 150,00 sq ft, is located in Chino, California, and Seko had just moved into it when Canyon came calling.

Once the deal was agreed, Mr Bourke said the company got to work making sure the facility had everything the bike manufacturer needed.

“From break rooms to specialised racks – bikes don’t work with standardised racking, they need to be oversize and longer in length,” he added.

“All this was done in collaborative effort with them – something we do not often need to do with clients which often have a much more standardised set of requirements.”

The collaboration continues, but Canyon maintains its own group of onsite staff to deal with customer queries. And Mr Bourke believes this collaborative effort has exposed him to a different way of dealing with supply chains.

“Companies have to think less of supply chains and more about demand chains, which entails thinking about what the consumer wants,” he said. “Canyon’s doing what a lot of other successful companies do, responding to consumer needs and changes in consumer practices.”

He sees Seko’s role as a facilitator for this strategy, but one that fits with the ethos and views of the client company. It was the right move for Canyon to have its people and Seko’s work together in the US hub, Mr Bourke added.

“Having them there kept the German design and engineering that made the bikes a success in the first place at the forefront. We make its consumer strategy work, we make it easy and fun to order, because those that make it clunky and awkward are the ones that are struggling.

“Retailers need to understand people want to order, those that figure this out – figure out the demand chain – they are the ones that can evolve; retail is not dying, just evolving.”