Page 3 - Logistics News August 2017

Thought Leadership

Predictive ordering and smart technology:

redefi ning connected supply chains

by Michael Elmgreen, CMO, Handshake. Courtesy SDCE.
The coming of Amazon Go stores marks a signifi cant shift in the design of in-store retail
experiences. The technology deployed by Amazon aims to streamline shopping by reducing the time
it takes for consumers to fi nd their desired products and checkout. If all goes as Amazon plans,
consumer expectations may eventually be transformed by this new way of shopping just like
Amazon.com set the standard for online buying.

FOR MANUFACTURERS and distributors, Amazon pricing, delivery dates or other attributes of an
Go is a showcase for the technologies that may order. The promise of predictive ordering is that it
change the retail supply chain in the years ahead. can complement human decision-making or even
From predictive ordering to RFID chips, companies replace it entirely, allowing for greater automation
need to become familiar with the technology that and more lean business processes.
Amazon is using, and understand its implications For example, in 2013, Amazon fi led for a
on their business and the future of business-to- patent described as a “method and system for
business (B2B) purchasing. As the adoption of anticipatory package shipping” designed to cut
these technologies becomes more widespread, delivery times and improve consumer satisfaction
retailers may expect suppliers to off er similar by predicting what a shopper is going to buy
streamlined purchasing experiences. before they buy it—and then to ship goods to the
shopper’s local area or actual location before the
Predictive ordering in focus sale is made. The patent outlines that order history,
Predictive ordering is the ability to compile, interactions with promotions and browse/search
suggest and execute purchase orders with a history may be used as inputs to the decision to
software application. The software uses data speculatively ship a package, which could then be
and trends based on previous sales history, ready to fulfi ll a predicted order or be promoted
consumption patterns and other inputs to make aggressively to a customer while in transit.
recommendations on product mix, quantities, To be eff ective, predictive ordering relies on a

2 August 2017 | Logistics News