“We ensure our business is aligned to our key suppliers and freight providers and that we measure accountability,” he tells Logistics Magazine.
“We have a set of KPIs right throughout the business to measure both internal and external adherence and the performance of our partners."
"We also provide reviews, for employees, third party providers and suppliers, including those overseas such is in the case of our shipping lines."
"ADRT also has performance reviews both monthly and quarterly to either acknowledge adherence and performance levels or to highlight and address any issues of performance.”
“Our approach is to have fewer suppliers and align ourselves with the higher performing relationships,” Miskle says. “We look for partners that actually create increased value both for all our stakeholders and who have the same value-set as ours."
"A good, strong supplier who is profitable and working with you to keep growing and developing is much better than having multiple suppliers who are eking out an existence on barely sustainable margins.”
Miskle also has very clear views on strategic sourcing, having had the role reporting to him for the last 18 years.
“Landed cost and margin are important,” he says, “but you’re not going to achieve your goals sustainably without a strategic approach to sourcing and aligning with the right suppliers.”
Phillip Miskle believes the single biggest current issue for the Australian retail industry is the downturn in the economy.
“The resulting withdrawal of spending is always a concern to a retail business despite its growing competitiveness as certain sectors continue to rationalise."
"But as interest rates, the stockmarket and oil prices remain volatile, access to the consumer dollar is will be the single biggest issue affecting retail.”
With experience in both retail and FMCG manufacturing, Miskle points to shelf–ready packaging supplied just in time as a development that has great potential to increase supply chain productivity.
“In particular at store level, shelf ready packaging makes products much easier to handle,” he explains. “Labour costs are lower, products are better presented and sustain less damage, since they are handled less."
"When properly done, shelf ready packaging actually enhances the shopping experience for customers.”
“In some instances, shelf ready packaging is simply a cost reduction strategy,” he adds, “In ALDI for example, you just see the products in a brown cardboard carton cut in half."
"But pre-packs and shelf-ready packaging for confectionery or higher value products are becoming increasingly sophisticated.”
“From an FMCG point of view, shelf ready packaging is viewed as another in a long list of retail requirements,” he says. “FMCG companies see themselves as having been bludgeoned into submission, going right back to the introduction of bar-coding."
"The perception is that anything that’s been done has predominately been dictated by the large retailers without any real long term benefits for their FMCG partners, who have had to pick up the costs.”
The upside is that shelf ready packaging in itself presents the product better on shelf, and can assist the customers self selection and the sales process.
Australian Discount Retail has moved away from Private Label to branded products as a point of difference from other large retailers.
“We perceive consumer acceptance of branded products remains at a higher level than generic products,” Miskle maintains.
“We’d rather offer a very good value branded product than the cheapest generic home brand item. If you come into one of our stores you’ll only see brand names at a fraction of the cost of generic or branded products at Woolworths and Coles.”
In addition, Miskle says it’s better business practice to offer FMCG branded products.
“If you speak to any FMCG company here or overseas, they normally provide generic and home brand product at a loss to enable the privilege of ranging their branded product to their customers,” he argues.
Phillip Miskle says the key to demand planning is knowing your customer, your market place and measuring forecast accuracy.
“Forecasting by its very nature is inaccurate,” he points out. “We measure and investigate, aiming to consistently refine our planning processes."
"Even when we succeed, it’s often only for a snapshot in time. Almost as soon as we’ve completed one implementation and lifted it to a high level, then there’s something new to look at, something more to do.”
According to Miskle, the company’s main approach has been to focus on market research about who the customer is in relation to the different brands that it operates under.
“Once we’ve done the research we then continually test it,” he says. “We’ll interview the identified target customers along with people who are not our customers in order to gain insight into what might change their minds.”
“In addition, all our stores are hooked up to a point of sale software,” he says. “That’s a full system that can slice and dice all our sales data in any way that’s required.”
Miskle also believes demand and supply planning tools are the supply chain technology of the future representing the advantage for companies that can outperform their peers.
“There’s a much greater and growing focus on end-to-end supply chain,” he says. “The ability to refine both demand and supply planning along with utilising procurement and cash flow management tools is a burgeoning area in the sector."
"Even the simple calculation of the cash flow effect if a supplier delivers product a few days early for example, has been underestimated in the past."
"Delivering early might be considered perfectly acceptable, since it’s not late but it’s important to remember that such an event does have a cash flow impact on your business.”
“Refinement in supply and demand planning, procurement and cash flow management tools are the areas I’ll be focusing on.”
As for the future, Miskle says ADRT will continue to look at a variety of ways to improve its processes and alignments including a view to greater efficiency, with less waste and a smaller impact on the environment.
“People development is always a high priority for ADRT,” he adds, “and it’s also something that I look for in any business that I work for. It’s critical to bring people along with the business and to have a value-set that enables that kind of development.”
“We also look to delivering higher levels of service to both our retail store network and the consumers themselves,” he emphasises. “I‘ll never accept there’s a time when we sit back and say oh, we’re there, we’ve done it.”