The best and worst of technology


The most relatively highly valued retailers are those that have been built upon models that rely massively on technology. We can include in this the likes of Amazon, Ocado, Farfetch, Boohoo, Asos and over the pond in the US the disruptors like Rent the Runway.

But what these players must ensure is that the technology that powers their businesses does not also leg them over. There have been myriad examples – some including the retailers above – involving technical failures that have temporarily floored companies.

One area where this often occurs is with logistics and fulfilment. It seems that the intersection between technology and physical product is the most sensitive of areas and prone to problems. Moving to new warehouses, adding distribution depots, and integrating new supply chain systems seems to be so highly likely to end in disaster.

Just such a thing recently happened to Rent the Runway, which is a rental clothing business with many customers on subscription-based arrangements. The implementation of a new system to handle inventory at its warehouse in New Jersey resulted in a limitation being imposed on the number of orders it could ship. Like a lot of these things the new set up initially delivers the opposite of what it was supposed to. Promised faster deliveries turn into actual slower deliveries!

The upshot is that Rent the Runway has had to face a barrage of angry customers, provide them with additional credits on their accounts, and potentially the most damaging thing is that it has had to temporarily stop accepting new subscribers. Yes, the company has in a virtual sense closed its stores’ doors to new customers. Surely nothing could be more damaging to a retailer.

It is paramount that businesses learn from the mistakes of others and do not take any short-cuts when implementing new systems – especially when they involve the sensitive and critical supply chain. The damage that can be inflicted is clearly massive. Those companies like Rent the Runway that absolutely, fundamentally rely on technology have to take most care in order to ensure that technical issues do not disrupt their operations.

Glynn Davis