Embedding resilience into retail supply chain planning with new sourcing and AI strategies

When it comes to supply chain planning, the days of relying solely on just-in-time models to drive down costs and streamline product flows are behind us. While the approach worked in a more predictable world, retailers today operate within interconnected supply chain ecosystems, where success depends on agility, visibility and collaboration across suppliers, logistics providers, and regulatory bodies.

Today’s environment calls for greater adaptability and foresight built on new sourcing strategies, stronger ecosystem collaboration, technology tools, and the ability to balance risk, cost and responsibility.

Navigating a landscape of disruption

Retailers and the broader business ecosystem are navigating a series of ongoing disruptions—from natural disasters to geopolitical uncertainty and changing regulations. The 2025 CGI Voice of Our Clients (VOC) research reveals that 55% of retail, consumer goods and wholesale executives cite changing political, fiscal and regulatory environments as a top macro trend.

Put together, these events disrupt supply chains, causing delays, cost increases, and lost sales opportunities. In addition, rising inflation and higher interest rates have significantly reduced consumer purchasing power and demand, intensifying competition among retailers. Even established players are feeling the strain.

In response, many retailers are reducing geopolitical exposure by shifting production to more stable geographies, often closer to end markets. They are offsetting the increased transportation time by shipping earlier and accepting higher inventory levels. Others are relying more on air transport, balancing speed against rising costs and sustainability goals. For instance, in 2024, the air freight to Europe more than doubled from some Asian destinations, creating difficult trade-offs for supply chain leaders (source: August 2024 edition of CA&AS).

Rethinking the “last mile”

For years, free shipping and returns have been driving e-commerce growth, particularly in Western markets. These practices helped build customer trust and drive sales volumes, but they have also created long-term challenges that are coming to the fore. While free deliveries are expensive, it’s the returns that pose the biggest financial and environmental strain. Total returns for the retail industry were projected to reach $890 billion in 2024 (source: December 2024; NRF and Happy Returns 2024 Consumer Returns in the Retail Industry). Many of these returned items are never resold, ending up destroyed or in landfills, adding to the environmental burden.

In the grocery sector, profitability remains elusive for many ecommerce retailers. High picking and delivery costs (whether from stores or central warehouses) make home delivery, lockers, and even click-and-collect operations difficult to scale economically. At the same time, food wastage remains a persistent challenge.

Looking ahead, regulation is reshaping how retailers operate. New legislation in Europe and parts of North America will soon require transparency around product origins, ingredients and the environmental impact of both food and garments. This will place greater responsibility on retailers and their ecosystem of logistics partners, technology providers, and other stakeholders to manage both data and sustainability more effectively.

How retailers can build resilience into supply chain strategies

To future-proof their supply chains, retailers must reassess their sourcing strategies and build resilience through smarter, data-driven decisions. Some strategies include:

• Evaluating the potential risks of sourcing locations for raw materials, moving manufacturing closer to home markets, and establishing alternative transportation routes and carriers
• Using multiple sources to decrease dependency and ensure the security of supply
• Enabling data exchange for faster and more accurate decision-making to improve collaboration with suppliers and transportation partners
• Exploring digital tools. including AI-based forecasting and replenishment, to support faster and more informed decisions

Tackling last-mile inefficiencies calls for modern technology strategies to reduce food waste, minimize fashion returns and improve sustainability across categories. These include:

• Helping online shoppers reduce returns by offering better information on sizes and colors, while introducing incentives to discourage returns. One method is to charge consumers the actual cost of returns to influence behavior.
• Enhancing price differentiation in the grocery sector based on expiry dates to minimize waste due to expired products
• Leveraging technologies like RFID and QR codes to gather more detailed data on each product
• Using AI-driven tools to forecast demand down to store level, including color and sizing, boosting both sales and inventory efficiency
• Tapping into AI-powered analytics to meet regulatory requirements by providing real-time insights and automating compliance processes

The reality is that disruptions aren’t going away. As global trade becomes faster and more complex, the nature of disruption will evolve as well. While we may not know what’s coming next, we do know that resilience, flexibility, and collaboration across ecosystems will continue to define the most resilient supply chains.

Do you have supply chain needs for your retail business? Let’s connect. I’m happy to share more insights on how we’ve helped retailers become more resilient.