Discover how Target is adjusting to the influx of online shoppers with its most recent new hire.
Change in management almost always signals an adjustment for the business as a whole. Target Corporation will soon be undergoing that transformation with its latest hire. According to a company press release, the big-name retail chain recently added Benjamin Cook, the former logistics and supply chain head at Apple, to its team. Cook's first day was on July 24, 2016 in Minneapolis at the company's headquarters. Specifically, Cook will serve as the senior vice president of global logistics, inventory allocation and replenishment.
Details on Cook
In addition to the duties listed in his title, Cook will also supervise merchandise planning operations, making him an integral part of Target's supply chain. His experience makes him well qualified for the job. During his last position at Apple, Cook transformed the logistics portion of the technology company's supply chain, adjusting it to accommodate for a new, more complex distribution model.
While working at Apple provided significant background knowledge, that job was not Cook's only experience with supply chain management. He also held positions at The Home Depot and Kimberly-Clark.
A Need for Speed
Target's supply chain management strategies need revamping in order to meet changing customer demands. According to Arthur Valdez, the executive vice president of chief supply chain and logistics officer of Target, Cook is the answer to that problem.
"Our guests expect us to deliver product quickly and reliably, and that means we need a supply chain that's increasingly fast and precise," said Valdez. "Ben's expertise and proven track record in cutting cost and reducing complexity in the name of speed will be an incredible asset to our team."
According to the Wall Street Journal, customer behavior is changing, and Target is looking for ways to keep up. Specifically, shoppers are increasingly turning to online stores, signalling necessary adjustments to the supply chain, particularly with logistics and inventory management.
The online shopping trend shows no signs of stopping. Citing statistics from Forrester Research, iAcquire noted that by 2017, online shopping will account for $370 billion in retail revenue, well up from 2012's $231 billion. Meanwhile, the number of folks who opt for online shopping over brick-and-mortar stores will hit 58 percent by the end of this year.
Why Inventory Management Matters
Target is on the right track by hiring someone experienced with inventory management, as leveraging this facet of the supply chain may be meeting customer demand. Speaking with CIO, Daniel Corsten of the University of St. Gallen in Switzerland said retail stores have an average of 8.3 percent of products out of stock. Clearly, then, there is room for improvement to avoid this problem. In fact, reducing the number of out-of-stock items can lead to an increase in earnings per share of 5 percent.
While having a leader with experience in inventory management is key, so is having the right data collection devices. With the appropriate equipment, stakeholders in all facets of the supply chain, from manufacturing down to those working with the customer, can communicate accurate information. That is, an online store won't list a product for sale that isn't available. At the same time, the flow of data can prevent instances where products are out of stock altogether.