DC Velocity - February 2018

Str at e gy

D CV / RI LA S TUDY ON RE TA I L T R END S

mance-guarantee standpoint. It’s a pressure cooker right now,” he says. “We could see failures or tougher going.” Sramek says. Those companies’ efforts often focused on things like energy and fuel efficiency, where they can see a direct connection to cost savings.

Several executives said it’s critical that their sourcing organizations ensure that goods are in compliance with relevant regulations, make sure products are environmentally safe, and address problems like forced labor, but that focus didn’t necessarily carry over into supply chain activities.

The interviewees have not widely considered an issue that could have a major impact on their supply chain costs in the future: the conflict between sustainability goals and consumers’ escalating demands for fast, convenient service.

“We asked them, ‘If you ship one item to one customer in
one box, what does that do to your ability to meet sustain-
ability goals?’” Davis-Sramek recalls. “The pretty universal
response was, ‘We’ve placed so much emphasis on fulfill-
ment and meeting customer requests that we haven’t really
made that connection yet.’”
Davis-Sramek expects that at some point, retailers will
come under external pressure to resolve
the tension between e-commerce and
sustainability. That pressure may come
from nongovernmental organizations
(NGOs), perhaps through a study on
the impact of home delivery on the
environment. Or it could come in the
form of regulation, such as a carbon
tax or European-style regulations on
packaging waste. Nobody knows how
far in the future that will happen, but Davis-Sramek expects
retailers will step up when it does. “I think they’ll apply
the same kind of innovative thinking they used to develop
omnichannel commerce,” she says.

b Leveraging disruptive technology. Disruptive technology is still more concept than reality for most retailers. “There’s no single cutting-edge technology that everybody’s focused on,” says Defee. “They know it’s coming, but nobody sees

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