Central Retail Vietnam cut stock-outs by about 20% by replacing its direct-to-store delivery model with a centralised distribution system. The shift reduced backroom congestion, improved on-shelf availability, and streamlined replenishment. The company consolidated logistics partners from over 20 to five core providers and prioritised process standardisation and staff training over rapid digitisation. Chief Supply Chain Officer Mike Reid emphasized that 'before you digitise, you must standardise' — reflecting a pragmatic, people-and-process-first approach to supply chain resilience in complex emerging markets.
According to retailasia.com, Central Retail Vietnam has overhauled its supply chain to reduce stock-outs by about 20%, shifting from a fragmented direct-to-store delivery model to a centralised distribution system.
A Shift from Fragmentation to Centralisation
Under the previous model, suppliers delivered directly to individual stores — causing congestion, inconsistent delivery times, and heavy administrative workloads that diverted staff from customer-facing tasks. As Mike Reid, chief supply chain officer at Central Retail Vietnam (a unit of Thailand’s Central Retail Corp. Public Co. Ltd.), explained:
“It created fragmentation, variable service levels, and limited visibility.” — Mike Reid, chief supply chain officer at Central Retail Vietnam
The new approach consolidates supplier deliveries at distribution centres, where volumes are pooled, forecasting is refined, and store replenishment is scheduled with demand-driven precision.
Operational Improvements and People-Centric Execution
The company prioritises process standardisation and workforce capability over rapid digitisation. As Reid stated:
“Before you digitise, you must standardise.” — Mike Reid, chief supply chain officer at Central Retail Vietnam
Staff training through the Supply Chain Academy covers problem-solving, transport planning, and demand forecasting. Process enhancements include standardised replenishment cycles, inventory governance frameworks, and performance measurement systems. Core enterprise resource planning (ERP) upgrades now integrate with logistics partners’ warehouse management systems — improving end-to-end supply chain visibility.
Strategic Logistics Partnership Rationalisation
Central Retail Vietnam reduced its logistics provider network from more than 20 to just five core partners. These selected providers must demonstrate scalability, willingness to co-invest, and adherence to strict performance benchmarks. This consolidation supports route optimisation, increased drop density, and better navigation of Vietnam’s complex urban logistics environment — characterised by fragmented trucking, limited inter-firm collaboration, and restrictive delivery windows in major cities like Ho Chi Minh City and Hanoi.
Practitioner Implications for Global Supply Chain Professionals
For supply chain professionals operating in emerging markets, Central Retail Vietnam’s experience underscores three practical imperatives: First, centralisation can yield measurable availability gains even without cutting-edge automation — particularly when paired with disciplined process design. Second, partner rationalisation is not merely cost-driven; it enables deeper collaboration, shared KPIs, and joint investment in capacity and technology. Third, workforce upskilling — especially in foundational competencies like demand sensing and transport planning — remains critical where infrastructure constraints limit technological leverage. Notably, Central Retail Vietnam’s approach mirrors broader regional trends: A 2024 Gartner survey found 68% of APAC retailers prioritised supply chain standardisation before AI adoption, and Thai-based CP All (7-Eleven Thailand) reported similar stock-out reductions after consolidating its 3PL network in 2023.
Source: retailasia.com
Compiled from international media by the SCI.AI editorial team.
