Ask Me Anything (AMA) Supply Chain with Marco Prino

Welcome to this new AMA session, Ask Me Anything, all about supply chain, organized by the Global Supply Chain Council and Chain.net. My name is Max Henry. I'm going to be your host for this new session again. So just to explain to you the format, EMA is all about having a special guest who's going to take all your questions, so we want to make this session as interactive as we can. You have the ability to ask a question to Marco at any time by just clicking on the question mark button located at the bottom of the screen. We will take those questions as they come, and hopefully we'll have some interesting ones to fill that session. Of course, we— I'm going to get started with some of the questions that I prepared for Marco just to kind of warm him up before everybody joins. Now we're still seeing some people joining, and that will give a bit more time for people who are a little bit late to arrive. So again, thank you, Marco, for joining this session. How are you today?

Hey, good morning, Max, and all the Supply Chain Net community and the GS60 Very good today, and actually pleased and honored to be here today. So again, thank you for the invite. Good morning and good afternoon to everyone. I hope to share a bit of experience and insight that may help in day-to-day business, but also in a bit of planning, tactical and strategical outlook to support ourselves in in increasing our supply chain capabilities. I just want to remark that I see this as a mutual opportunity, so I will learn a lot from today's session, also based on the questions. So I wanted to thank beforehand for the participation to this forum.

You're very welcome. So some of you who don't know yet, Marco, so this is Marco Prino. You are currently the D2C Supply Chain Director for Europe and APMEA working at LVMH. Electrolux. You have over 15, close to 20 years experience in supply chain and retail operations. So you have probably a lot of stories to share and some great insight to provide also as well. If you're just arriving again, I want to welcome you to that AMA. We're going to make this session as very interactive. So if you have any question for Marco, get ready to click on that question mark button located at the bottom of the screen, and then we will take your questions as they come. So Marco, maybe we'll start by just by trying to understand where you come from. So could you maybe start by introducing yourself and share very quickly an overview of your professional background here?

Absolutely. So my name is Marco Paino. I'm based in Italy. I'm 44 years old and I live in a small village with my family, my wife, 2 kids, we have 1 dog. And since 2 years and a half, almost 3 years, I joined Electrolux as a director consumer supply chain director for Europe and Asia Pacific, as you said, Max. But let me start maybe from the beginning, from where I come from. This may explain my, in a better way, my professional background. So I grew up actually close where we live today in, um, in an area in the north of Italy that based its growth on a solid textile manufacturing districts. So all my neighborhoods when I was kids, all my friends were somehow dealing with textile manufacturing. And so I did. I remember that I was kid, the common activity for Saturday and Sunday was to clean the manufacturing. So being very hands-on since a pretty young age because this is the way was the way, the lifestyle in these surroundings. So I grew up in a manufacturing environment basically. And my grandfather had a repair workshop where I was also enjoying a lot to stay and learn mechanics. Then I had my scientific high school and then at the age of 18 and 19 when approaching university, I had a bit of a rebel behavior towards all this environment, and I decided to study sociology. So human science, which is actually quite a strange academic background for supply chain professionals. 90% or slightly too close to that percentage are engineers, management engineers, or in other field. But a lot of supply chain professional comes from engineers or at least business administration. It's not my case. I studied sociology, and I will touch later how I think that this brought me here where we are today. But just to, to put one, one word that for me is key is soft skills, and more growing in roles, more soft, soft skills becomes important. But this said, uh, yeah, please.

At the time you studied sociology, did you actually ever think about supply chain logistics, or Is that something that you were interested already or nothing?

Not at all. Not at all. Not at all.

Okay.

My passion during that period was on retail, actually. Retail in the end of '90s was something that was really exploiting in Italy at least. And these new big shopping centers popping up, I don't know why, but they were really attracting me. I was really attracted. By this new business unit where you can buy everything. And before, you can imagine being in a small village in the mountains, the biggest dimension of a shop was 40 square meters, and now there were these facilities with thousands of square meters offering everything including experiences, not only product. So I got passionate about retail in, in that context, and while studying sociology, I had the opportunity to to steer a bit the direction of my study, and I took the direction of focusing on work organization and HR management. And the next step after being graduate, it has been to enter in the retail industry. So I had the opportunity to enter in the Auchan Group, Auchan family, who owns—

Mm-hmm.

Big supermarkets and other business. in a fast-track development program. So I started as a department clerk and ultimately in a few years I was a store manager of a bigger retailer business unit. In that moment I got actually passionate about logistics, Max. And I think that also it's something that brought me back to the roots that I was mentioning before. So I've been growing up in a manufacturing environment. I had my rebel period studying human science, entering in the retail from the sales door, but then my profile being quite squared and pragmatic, directed to logistics. I got passionate about logistics when I was a store manager being in charge of the P&L of the business unit. And of course, logistics is a key driver for the P&L. When it comes to availability, when it comes to handling, when it comes to impact of in-store retail damages, for example, um, it, it was on my, on my performance review. And actually, uh, I, I put a lot of effort in, in making sure that the logistic part was well, well working. And I also understood that sales was not my backbone. And then I had the opportunity to change job and company. So I put myself in the market as a logistics professional, and I joined Conforama as a warehouse manager. So I started as a warehouse manager. And then after a few months, I got a call from IKEA. And for whom is passionate about retail, at that time IKEA was the dream company. So I didn't hesitate one second to change employer, even if it was just a few months. And actually the experience at Conforama was going very well. And that started my career in IKEA when I spent 9 years actually in different logistics and supply chain roles. So I've been a warehouse manager, of retail units, logistic manager in a retail unit, so owning the end-to-end logistics within a big store, IKEA, the classic IKEA store, project manager for logistics at the retail level and distribution level. So I was also leading project in IKEA distribution center. And then something very important happened. I got the opportunity to step from market role to a regional role, and I joined what was called the multichannel transformation program. Today we would call it direct-to-consumer product.

Okay.

At that moment it was called multichannel, and I will speak maybe later a bit of this because I have A lot of learning from that activities. So I moved to Sweden. I've lived 3 years in Sweden leading multichannel transformation logistics and supply chain for Europe at IKEA. And then was almost 9 years, more than 9 years, close to 10 years, and I wanted to change company. I think that is not healthy to stay too long in the same company.

Yeah.

So reaching the 10 years, I put myself in the market again. I made a study to close some of the academic gaps that I have because I'm not an engineer. So I, I've done a master to, to close the gap, a master in supply chain and in Industry 4.0. And I had the opportunity to join Dyson in Italy first as a head of supply chain end-to-end. for Italy and after a few years head of supply chain for South Europe. 3 years of intense experience at Dyson, but then also another opportunity came and this opportunity came from Electrolux to join with a role that initially was a kind of internal consultant. So to open or to build up from scratch the direct-to-consumer fulfillment for Electrolux. because D2C for Electrolux is a new business model. With 100 and more years of B2B business, few years ago Electrolux decided successfully to open the D2C channel. And yeah, I've been on board to bring the expertise that I had in my experience between retail, multichannel, and e-tail to support Electrolux on this journey. I led Europe first and now as an out put over your organization within the company. I'm leading Europe and Asia Pacific, so traveling a couple of times a year in Bangkok where I have a team. So this is the journey.

Okay, that sounds great. So what is your current role at Electrolux? If you could just explain in, in very simple terms what, what you are doing here.

Yes, so as I said, I joined Electrolux as an internal consultant, kind of internal consultant, but then we discovered within the organization that I should have a team because the agenda was really tough. So I joined, I was alone, and today I have a team of direct report of 8 people and many other functional reports from the different region. So my role is to design and establish the fulfillment process for a successful direct-to-consumer business. What is direct-to-consumer business, first of all? It's mainly e-commerce, but it's not only that. We have also a part of brick-and-mortar. We have some direct sales happening with our technicians when repairing products. But we can easily say that direct-to-consumer, just for simplicity, is e-commerce. So I'm designing processes, supply chain processes. So I'm designing how we demand or how we create a proper demand signal for, for D2C, or at least contributing to that. I'm designing logistic processes at warehouse and transportation. So I have direct influence on pick, pack, and dispatch processes, direct influence on establishing a proper network of last-mile carriers. So setting up the distribution network for, for D2C. There is an important component in the white goods, which which is the reverse logistics. So whatever is triggered by a return or an exchange of a product. Aftermarket in the white goods is quite— there is quite high weight in terms of business when it comes to make sure that there is availability of spares, to make sure that our products are repairable. Even for 10 and more years. So this is what I do with a team of people. I have project manager reporting into me because a lot of these fulfillment design or the fulfillment improvement, it passed through technology enhancement. And the technology enhancement, digitalization requires project managers from our side. A big focus on cost. Cost excellence is one of our priorities. So I have one person dedicated cost excellence. I have one person dedicated to reverse logistics. So this is in a nutshell what drives my agenda.

Okay. So for those, because I know Electrolux and I bought some products before also. Yeah. You can find Electrolux products in shops, you can find them in supermarket, hypermarket, in appliance stores, specialist stores. So you're not covering this, right? You're not handling— this is a separate— so how does Electrolux— is there a clear division between what gets sold inside the stores and what you are doing?

Yes, absolutely. So it starts from clear distinguisher of the sales channel as such. So we have B2B sales and D2C sales, and then every sales dimension has its own process. When it comes to then logistics, here there is a lot of synergies because B2B products and D2C products are dispatched from the same warehouse. So from a warehouse perspective, it's the same, but the processes within the warehouse are very different because B2B is full truckload, D2C is one shipment per product, basically. So the processes are very differentiated. That's why at Electrolux we have my function, which is really focused to bring knowledge and expertise on a fairly new business model from a supply chain perspective. So very strong legacy, very deep knowledge, very maximized operation in B2B. For D2C is a bit different because it's a new business model, and here is where I'm bringing my expertise when it comes to direct-to-consumer and retail—

and e-tail, sorry, e-tail So when you mentioned D2C, is this Electrolux or marketplace selling to consumers, or are you also including Amazon and, and, and the like, and many other marketplaces? Are you also handling this?

Absolutely, it's both. You can find our product in our branded webshop, so www.electrolux.com. SE, if you are in Sweden, for example, but you can also find our products in many marketplaces. This is a very common business development strategy to expand the accessibility of the products to different D2C channels, which can be owned or demanded to a third party.

Okay, so you mentioned that the products are stored in the same warehouse, but I can imagine, obviously, the 3PLs of the transportation company who are fulfilling and delivering those products might be different, right? Are you working with different partners depending on whether it's going to be B2B or B2C?

Yes, absolutely. We strive to look the best partner for the different business needs. And B2B Transportation companies, for example, are not so capable maybe in, in D2C business and vice versa. So a differentiated transportation strategy, if we speak about transport specifically, is, is very needed. What you may see in, in the D2C business, it's also a big number of startups appearing in the market. Especially offering premium services in the high-density areas like next-day delivery or green deliveries provided by bikers, not even drivers. And the higher the numbers, more is the dimension of the business. The objective is really to, to provide the best service fitting the consumer need region by region or even zip code by zip code. This is the strategy of D2C, of every company expanding in D2C. So to tailoring the last mile capabilities to the consumer needs in order to enhance conversion rate, because the ultimate objective is to sell, of course.

So Electrolux, correct me if I'm wrong, but you make, you're producing white goods, So fridge, you know, washing machines, probably dishwasher, but you're also making smaller appliances, right? Like it could be, I don't know, some small oven, or what is the range of products that Electrolux is doing these days? And are you focusing on certain type of, on smaller type of products, for example, for D2C, which are Easier to deliver?

A very good point. Let me just give you a couple of numbers of Electrolux. These are the public numbers. So Electrolux is a group that more or less reached €12 billion sales in the latest year. We are covering 120 markets. So we have a worldwide coverage and we have more or less 45,000 employees. employees. So this is the dimension of the company. And our products, so the products that you can find in the market, are divided in 3 main categories. So we have what is so-called taste, which is basically whatever fits in your kitchen as a white good, as a big appliances.

Okay.

So we have ovens, we have hobs, we have hoods, we have fridges, microwaves. And here we have the freestanding, so quite easy to deliver and install. And then we have the built-in, quite easy to deliver but very complex to install. That requires competencies and hard skills in installing those products. Then we have the— and this is 60% of our range in terms of turnover.

Okay.

Then we have laundry, or we call it care, but basically is whatever fits in your laundry. So dishwasher and dryers, mainly 30%. And here is all freestanding. There is no washing machine built in, for example. You know, washing machines are always freestanding. And then we have 10% of the business, very, very important for the direct-to-consumer because it's a category which is e-commerce friendly, let me say like this, which is, as you said, Max, the small appliances. We have air fryers, we have toaster, we have vacuum cleaners. Those we categorize as small domestic appliances. And it's an important category for direct-to-consumer because consumers actually are very keen to purchase small appliances online more than go in a retail environment. But it's not what drives only the direct-to-consumer. Also, the other 2 categories are largely sold via online because consumer behavior is changing. If we think 20 years ago, we would never buy an oven without touching it in a showroom, in a shop. Today, the new generations are completely changing the evaluation of in their purchase process. So star rates or feedback from other consumers are sometimes more important than looking at the product in real life. So also with Taste and Care, we are expanding a lot our direct-to-consumer business.

Okay. All right, we'll come back again in more details on what you do, but I just want to take that question right away. So Shane is asking, can you share a bit about what has been the biggest challenge or the most difficult time in your career?

Yes, this is fun, and it has been at IKEA. So imagine IKEA, imagine Ingvar Kamprad, the owner of IKEA, that have successfully built probably the most successful business model in the world at that time, being also one of the most rich person in the world.

Yeah.

And IKEA cash and carry. IKEA has been for 60 years cash and carry. So you go in the store, you find what you like, You take your product and you go home.

And you pick it up and you go home.

And you pick it up and then you go home and you install it. Then 15 years ago, the consumer behavior, thanks to internet, started to change. And IKEA realized after a lot of painful and long discussion that the business model may not survive. So the business landscape is full of examples of companies that they just finished their career or their life because the consumer behavior changed. The most common, no, it's Kodak, for example, that didn't approach digital photography and many others. Well, IKEA understood that cash and carry cannot be the only business model in moving forward. And here is where multi-channel transformation program came to play, which is where I was working. And the biggest challenge here, and this is a challenge that I see everywhere, anytime that there is a big disruption in the business model, maybe not with that entity at IKEA, but the biggest challenge was— the change management. Starting from the top, even the founder of IKEA was not convinced that there is a need to change the business model. So you can imagine cascading, uh, how much was the resistance, especially if not changing personal objective of leaders. Because approaching a change includes a lot of cost, Actually, take an example. A country manager. I was the one going into the country saying to the country manager, look, we need to implement new technologies. We need to implement order management system. We need to change our processes. We need to transform our stores from being pure stores to be also fulfillment node. Because we will have a ramp-up of e-commerce requests that we need to fulfill. most probably from the store and not from a distribution center to be profitable. And the ticket for this is X million euros. And these X million euros are impacting your P&L of this year. So you will not reach your objective and you will not get your bonus. Basically, this is in a nutshell saying.

Okay.

So you can imagine how much difficult it has been for me also because I was pretty junior. At the time, it was more or less 10 years ago, so I didn't have the leadership skills that I have today to influence the organization, and I gained it along the year. So that has been the most challenging task.

And was working in IKEA Sweden easier for you to just to break that resistance and get people to be more convinced on what you wanted to do?

It has been not so difficult to show the results, also because in such a big company, a project can take years to be implemented, not months.

Yeah.

For example, order management system implementation, which I was in charge, took many years, close to a decade. So it's not easy to convince people, okay, trust me, you will see, you will see the result in 18 months. No, the result will come probably in a decade. But now it's very rewarding to see that IKEA has a large part of their revenues are coming from actually customer order. So—

Yeah.

Consumer wants the product delivered at home. The cash and carry model is not anymore 100%, is not even 70%, is lower. So it's rewarding to see that the people involved in this transformation program understood that it was the right thing to do, but definitely not easy. And how to onboard the resistors, it has been a very long journey and I didn't even see the end because I'm sure that somehow it's still ongoing. Yeah.

Yeah, it's a big, big company. Yeah. So let's go, let's come back to Electrolux. So in your current role, how do you define a consumer-centric supply chain? And, and what strategies have you implemented to effectively scale business growth while keeping the consumer at the center?

Yeah. So in direct-to-consumer, I mean, the word speaks by itself. Direct-to-consumer, and consumer centricity is the main competitive advantage in a very competitive landscape. And being consumer-centric, for me, it means to hear the consumer needs and transform these consumer needs into processes that fulfill the needs of the consumer. and do this in the most profitable way. The point is that in direct-to-consumer business, the consumer behavior is changing overnight. It's enough, it's enough that one big influencer posts on Instagram one product of your brand that your warehouse operation are disrupted the days after if you didn't plan for that. And I have quite a number of cases from Dyson, because Dyson, you know, has a high brand awareness and brand consideration. So there is a large base of followers that are really keen to purchase or not accordingly to different marketing strategy that are super impactful. In this very quick behavior changing of our consumer is key to stay updated. And the most— the best way to stay updated is to be a consumer. So you see the service offering of different players by purchasing or by placing a fake purchase. What I mean, you— I mean, I cannot afford to purchase whatever I'm looking into our competitors in order to understand which are their fulfillment strategy. I just arrived to the end of, of the purchase journey at the checkout page before pressing the purchase button. And I can get so many insights on what is the fulfillment strategy. For example, I can understand if my competitor is offering a pickup point network to deliver their product. If they have enabled bike deliveries, lockers, if they have white gloves premium services for a complex built-in oven for the kitchen. So this for me is something that I try to give a bit of time every week for this. The other point which is a competitive advantage and is very scientific is that the range dimensioning of an e-commerce website. And here maybe I would like to bring one example. This is an experiment, a public experiment published many years ago, I would say, but is very actual and there are many others. So the experiment is the following. Imagine your preferred shopping center in the food area. There is in the hotspot a small desk where you have 6 different jars of jam in sales. There is also one person that lets you taste the jam. You can go there, you can taste how many tastes you want, and then the number of products purchased are registered. And then we do the same, exactly the same exercise, same spot, same day of the week, same hour, same weather outside, same song on the speakers, everything exactly the same, but instead having 6 jars you have 24. Guess what is the setup that sold more? The 6 jars sold 29. the 24 jars sold free. So, okay, the complexity of the range can paralyze the consumer.

Yeah.

And there is a very scientific way, and this is the competence sitting, the competencies of the digital marketers. There is a very scientific way on how dimension the range in order to maximize, to over. If you enter in a website and you see 50 washing machines, it's difficult to choose. If you enter in a website and there are 5, okay, I want that one. I really want and I'm going to purchase. So the range dimensioning is something very important. And as you can imagine, being a supply chain professional has a huge impact on, on supply chain, starting from demand signal, manufacturing. So linear is the range. Higher is the productivity and the profitability, but cannot be too linear because if you can choose only between 2 washing machines, I said, no, no, I want to see more. Transportation, storage, handling. So this is something that it's very important to be consumer-centric and there's a huge impact on supply chain operations.

So that's interesting because that's something you can obviously control on your own website. But when you work with partners like Amazon, do they also realize that? And because on Amazon you can find dozens and dozens of similar goods and they always kind of recommend something similar to you, so you get overwhelmed too. So how much influence do you have on those marketplaces to kind of control the range of those products?

Yeah, so basically marketplaces are not showing the products are ranked randomly, let's say.

Yeah.

Also there, there are very scientific algorithms on how, what to show first, because clearly what is shown first sells first. There are different dimensions, reputation of the brand, lead time, and here is where we come to play as a supply chain professional or logistics professional. So the service should be very high, and this is a challenge because not everyone is capable to deliver next-day product. So to work with the marketplaces, their requirements are bringing really the bar higher, which I think is a good— is challenging, but it's also good because this helps the organization to to, to reach higher, higher standards. And then there are many other variables like price or brand awareness, payment terms, which is not really in lending into the supply chain field. But I would say that from a supply chain perspective, availability, lead time of delivery are the main ones that can influence the ranking of your product in the website. And who works with the marketplace knows very well because this is one of the main business requirements that they are setting in the initial meetings. So if you want to work with us, you need to do, you need to have this, this, this, this, this, and that.

Yeah. Okay. Let me take a question. There's a question from Sharon and let me bring this on screen. She's asking, how do you get your team on board with big changes in supply chain processes?

Interesting question. Thanks for that. So it's, I would say, mainly 2 dimensions. So the first one, which is key, is to secure that the people that are part of my team can be the change agents. I always say that working in D2C is not for everyone. It's not for everyone having business requirement changing overnight just because an influencer has placed one TikTok video. Or if we don't want to be so extreme, the importance of sustainability is growing quite rapidly or lowering quite rapidly also to political happenings around us. So it is changing. There are many variables that make the direct-to-consumer direction and business requirements changing rapidly. So the main requirement is to have the right profiles, and it's fine to have employees that are not fitting with this specific environment. It's totally fine because there are, there are other parts of the company where they can deliver. But to deliver in direct-to-consumer is important to have the, the right profiles. Open-minded, really wanted to be challenged and being adaptable with the context changing rapidly. And then it's about to really have a direction, a vision where we want to be in the short term, in the mid, and in the long term. Where the long term, Referring to 5 years, not more, because we cannot even imagine what will happen in the e-commerce environment in 5 years. But having at least a direction, this is what makes comfortable the people with the team in, in being onboarded on, on big changes.

Okay, again, thanks again for this question. If you have any more questions, feel free to ask now. We still have some time with Marco until the end of the hour.

Let me—

so you mentioned, you know, how important technology is, and I want to understand, obviously in retail supply chain, digital transformation is a big topic. Can you share with us what— how did you actually leverage some of the digital tools and technology to enhance your supply chain operations, specifically, you know, within the the context of D2C at Electrolux.

Yeah. Okay, so digital is key in every process. Now I see the same development of technology, the enhancement in the different part of the companies. When it comes to supply chain, D2C specifically, or supply chain, I would be more general here. It's a lot of Digital enhancement when it comes to visibility. Visibility, I refer performance visibility, goods visibility. Where is our, where is our product within the ocean, for example? When will arrive? It's a lot of predictivity, especially in the area of the demand forecasting, with a lot of focus on net operating working capital. Technology and digital tools can really help in having a more accurate and reliable demand, which brings a lot of benefits. First of all, in terms of availability, because what is very key, and here I want to stress this message for the direct-to-consumer, in direct-to-consumer you can sell only or almost only what you have in-house. While for B2B you can sell 100 fridges and say to the customer, look, your fridges will come in 2 months. Okay, I'm fine, I place the order and I will pay after 6 months. In direct-to-consumer, you can sell only if the product is available, or at least if you have the right digital tools, if it is in transit. So availability is key and the the digital or the technology around availability, which starts from properly demand the stock, properly produce, transport in time. And here it's where visibility is very important and secure that the stock is properly booked in the warehouse, is, is where we put a lot of focus as a supply chain professional, not only at Electrolux. We know which are the trends now in the industry. Artificial intelligence is knocking on the door. Some companies are more advanced, some are behind. I'm really curious to see where this leads because the, the curve is almost exploding now, I would say.

Yeah.

So I'm, I'm really curious to see where we are going. not as a supply chain professional only, but as a human being as well.

There's a question for you actually. Shane is asking, and let me put this on screen. So he's asking, are you already using GenAI in your daily tasks? What do you think would be the biggest impact on your job moving forward?

Yeah, we are exploring GenAI. I cannot say that we are using GenAI, but we are exploring. And the first field is route optimization, where we are exploring how GenAI can support us in really maximizing the transportation. What do you think will be the biggest impact on your job? I don't know. I don't know, and let me explain why. I see the big potential. I see the disruptive potential. But I still didn't see concrete example. But I know that in a few months we will have tons of concrete examples. I'm really curious to see how AI will help in procuring services. So in procurement, purchasing, I'm sure that here there will be a big leap having this huge task of contract evaluation, contract signing, market scanning of the different offers here. I'm sure that will bring a lot of benefit. But I'm here just waiting to see where we will have the big leap. Anyway, demand and forecasting is definitely one area where we will see AI taking more place and bringing actually more— a lot of profitability on this regard. Because today—

Is it working for you already? Are you actually using some kind of AI tools in your supply chain planning or demand forecasting currently?

Not in demand forecasting, but in the route optimization we are exploring and we see some benefit. Yes, yeah, definitely we see the benefits.

Okay, that's interesting. So if you had to, you know, kind of want to understand also Where do you see the e-commerce space moving? You know, obviously, I mean, through COVID, there's been a huge surge. Do you see that kind of stabilizing a bit more and people kind of mixing their purchase between brick and mortar and online? Or what kind of trends are you observing and what would be the impact on what you do moving forward? Yeah.

So for me, the keyword is omnichannel in a sense that having different sales channels with different fulfillment capabilities really strength the brand awareness and the brand consideration. If we take the example of IKEA, today is really fun. You go in an IKEA store, you see people sitting on the couch, oh yes, I really want this couch. Then they take their phones and they order online by being sitting within an IKEA store in the couch that they want to buy. So this for me is one of the best examples of omnichannel, also from a physical location and where people are. And having this double or triple or multiple dimension of having accessibility to a product which can be online, can be physically, can be virtually in a, in a, in a virtual showroom, can be through the word of mouth of the neighborhood thanks to brand awareness, for example, Dyson. This is what gives a competitive advantage. So I would not distinguish the in a successful company, the 2 different channels and having those conflicting between themselves. But actually B2B strengthens D2C and D2C strengthens B2B, just because the brand is one and the brand awareness and consideration is built from any possible channel that the company has available. Then we have pure e-tailers player. That is another business. For example, Amazon, if we want to take the most common one. So that is clearly their business model. They tried the physical presence, but clearly they are e-tailers. I would see from another angle. From a company, it's important to be present also there because that is another channel to make People assess your products through marketplace in this case and not your own website or your own shop or your own showroom or your own event in that specific day in the hotspot of a, of a shopping center, for example.

So we talk a lot about supply chain risk and, and, you know, we are going through some very challenging time with what's happening internationally with tariffs and all those different crises that companies are going through. What kind of risk do you see on a daily basis? What, what has been the most, you know, troublesome for you with your day-to-day operation at Electrolux?

So we have been a few high-risk context in the last 5 years. So COVID clearly disrupted the way how we think of the supply chain moving from being a service to be actually an enabler of the business. If your supply chain doesn't work properly, you don't do business. It's not that you do it at less cost. No, you don't do it anymore business. And then it's enough a vessel in the canal, that is blocking the canal to make your shelf being empty for 3 months or even 4 months and having congestion in the port for, for other 3 months. So something happened that is clearly changing the approach that we as a supply chain professional needs to have to risk mitigation. So risks are part of unfortunately normal life. Without even speaking about the political setup that we we see changing with with the globe that may further disrupt customs and etc. What is key here for me is scenario planning. So we need to be prepared with scenarios. What if? What do we do if? What do we do if that? What Do we do if this? Here AI actually is one powerful tool that can make complex analysis in a few seconds instead of months of analysis in Excel. This may be answering to the previous question. Here is also something where I see a lot of benefit of having AI. But this said, scenario planning, it's key now to to face in a proper way the risks that inevitably we are going to face with the, with the business.

Yeah, so for, for people who are interested in, in getting into retail supply chain, what do you think are the key competency or skills that you recommend people to, to build if they want to succeed in this field? And, and do you— let me add a small question to it. Do you think that the current program, because you, you mentioned yourself that you didn't come at all, you didn't study at all supply chain, and, and, and you had to later on in your career had to kind of upgrade and, and get this, this master in supply chain just to kind of fill the gaps in your knowledge. But do you think that those programs are still up to date and And are they still relevant in the current environment that we're going through?

So answering to the first part of the question, what is needed to have a career within retail or e-tail, let me say as well. So consumer obsession is the starting point. In whatever department you work, if you are not very close and very keen to hear the consumer on a daily basis, that is a competitive disadvantage. When it comes to the, the competence profiles, today more than ever the soft skills are, I think, I think very important. More you scale the hierarchy in a company, more you need to be able to, to negotiate, to handle complex stakeholder portfolio, To influence without having the stars on the shoulders, because nowadays in big corporates, the functional matrix is very common. So you are not the direct leader of a person, but you are influencing his or her agenda. So these competencies are more and more important, especially if we look ahead and back to AI, having AI that can substitute sooner or later a lot of administrative tasks, then it's very important to be in the driving seat influencing the organization in going towards what we think that is the right direction. There is a lot of decision that needs to be taken on data, and this is another important aspect. Retail is detail, maybe you have heard about this. data-driven decision-making is very important, but due to the speed of the changing environment, we don't have always the time to take decisions on data. And sometimes decision needs to be taken on gut feeling, trusting the expertise, the knowledge of ourselves and the people around us.

Yeah.

And this is an important competitive advantage, I would say. If a leader is capable to take some risk in this direction and say, okay, I think that this is the right thing to do, let's do it.

Okay, we have one more question that I'd like maybe kind of take before we wrap up. Someone is asking, what trends do you see shaping supply chains in the next few years? Yeah, general question, actually good question to kind of close VCMA today.

Yeah, yeah, I would mention too. So AI, we, we already said this is gonna shape, uh, how, how we run the business. How exactly, I don't know, and I'm very curious to see how this shapes. What I'm sure is that will happen very soon. Um, the other one is collaboration. So we have, uh, within logistics specifically, I'm now, I'm referring to the transportation part or of each company, we have reached very well optimized service level and productivity. The only step to go forward is to collaborate even between competitors. And I give you a practical example, utilizing the same truck to deliver my washing machine and the competitor washing machine. This is an example. If we think at food, the same, my yogurt and your mozzarella on the same truck. This is something that we don't do yet. It's something that sits in our DNA. I don't want to do business with my competitor. So it's something that really sits in our behaviors. But this needs to be changed. So if there is something that I see shape the supply chain the next few years is collaboration. Easy? No, we know because it's really sitting in our backbone of human being. But this is where could bring to the next level of transportation and potentially also lowering the impact that we with our business have on the environment.

Yeah, we call it coopetition in logistics, right? Which is, which is I think happening in some of the sectors. So, so are you, are you seeing signs that it's happening already with some of your competitors? Are you, are you able to do this on, on, in some markets or it's still difficult?

No, I didn't see it yet. I'm just seeing happening in some sectors. So I'm referring more and more in general. I think that this is something that also from a political perspective needs to be boosted or demanded, even demanded. Okay, great.

Thank you very much, Marco. That was great to have you today for VCMA. Thanks again for all those questions, and we had a good talk, and it was very interesting to understand what you do at Electrolux, you know, how is the direct-to-consumer segment is also evolving in places like Europe. And I'm sure you guys will have learned a lot. I did learn a lot about this and it was very interesting to hear from you, Marco. Thank you very much again for being with us.

Thank you all.

Yeah, thank you. And this was again our AMA with Marco Prino from Electrolux. Again, if you missed some part of the discussion, this is being recorded. The replay will be made available on our platform, chain.net, starting tomorrow. So you'll be able to watch again, you know, the entire session. And again, if you have other questions related to D2C for our retail supply chain, don't hesitate to ask your questions on our platform. We have a specific channel called Ask the Community where you can ask any question related to this field. Thank you again, Marco, and we look again, all of you, to see you at our next event. Thank you. Bye-bye.