Significant benefits are there to for the taking if retailers and suppliers fully exploit supply chain information technology developments, particularly Electronic Data Interchange, EDI. However, a significant change in business attitudes and development of genuine partnerships is essential to realising those benefits. This is the conclusion of a survey of 135 British companies with a combined turnover of UKP46,000m conducted by the Logistics Division of P-E International Plc in conjunction with the Institute of Logistics and Distribution Management Southern Region. Retailers will be the principal beneficiaries of closer working relationships and their inventory levels will fall alongside decreased distribution costs. However, many suppliers feel that partnerships will be unequal with more take than give by retailers. The consumer goods supply chain would in fact be a demand chain. Nearly all the companies surveyed believe that closer working relationships will involve the increased sharing of information and 75% expect that there will be genuine attempts to identify and agree mutual objectives. Nonetheless, suppliers are more likely to seek security in even closer relationships while retailers are more sceptical about the feasibility of this. Consequently, there is a danger that mutual mistrust and issues of confidentiality could constrain progress. The most significant changes in physical distribution are likely to be reduced lead times, increased delivery frequencies and the concentration of distribution channels. British companies are trailing their US counterparts by four years, and they are failing to gain advantages from Electronic Data Interchange and other technologies because of their fears about confidentiality and adversarial business relationships. However, the advent of Quick Response partnerships in the US has ushered in lower inventories, fewer markdowns, shorter lead times and improved profitability, the P-E researchers declare.
