How can retailers strengthen supply chains in 2026?

The 2026 Australian Retail Outlook is out now. This must-read resource is packed with exclusive insights from Inside Retail’s survey of retailers about their performance, plans and predictions for the year ahead.

To give you a glimpse of what you can expect from this year’s report, we are sharing selected articles over the coming weeks. Be sure to download the 2026 Australian Retail Outlook to discover more.

As retail leaders head into 2026, they confront something of a supply-chain paradox. On the one hand, consumers’ purchasing decisions are increasingly driven by fast, reliable delivery and sustainable business practices. Yet at the same time, those supply chains have never been more susceptible to erratic global threats.

Operations specialist Lyn Nguyen, sensing the mood, sums up the challenges the next 12 months will bring to already exhausted executives.

“Tariffs will be a major pressure point, with importers likely to face revisions, increases and sudden shifts throughout the year,” she said. In addition, broader logistics costs are expected to climb as fuel prices rise, flowing through to higher trucking, ocean freight and air freight rates, while the Red Sea crisis and ongoing raw material shortages will also continue to extend lead times. “In 2026, adaptability is critical,” Nguyen said. “Businesses that forecast early, diversify suppliers and stay closely aligned with logistics partners will be best positioned to navigate the year ahead.”

Speaking to Inside Retail, many of Australia’s most prominent operations leaders say they have quietly been heeding the call – devising coping strategies and workarounds to seize the opportunity from the challenge.

Here, we present the best of their advice.

Failing to prepare is preparing to fail

“If the last few years have taught us anything, it’s that you can never be too prepared,” Jasmine Russell, COO of LVLY, told Inside Retail. “Between unpredictable weather, transport delays, and rising costs, having backup plans and a flexible supplier network has become essential. At LVLY, we’ve focused on diversifying our floral and packaging suppliers across multiple regions to stay nimble and keep delivering fresh, beautiful products no matter what’s happening in the world. It’s all about building strong relationships and having the agility to pivot quickly when things change.”

Tony Zasimovich, global VP of retail at global logistics firm DP World, agrees that flexibility will be key. “Retailers are heading into 2026 carrying pressure that’s been building for years,” he said. “Volatility isn’t easing. You see it every day: uncertainty from regulatory compliance and global geopolitical events, frontloading orders to avoid shocks and border delays, and a resulting stock build-up at distribution centres, which poses a risk to bottom lines. We’ve seen that retailers are constantly reacting to issues as they navigate a world in flux.”

One trend that will define 2026 is the shift from reactive operations to predictive resilience built into networks. Retailers are increasingly looking for ways to identify pressure points earlier, so they can reroute or re-sequence before customers feel it. In fact, a recent survey commissioned by his company found that more than 90 per cent of leaders had seen revenue hit by transport issues. “That means the incentive to get ahead of disruption is very real. Predictive logistics is what closes that gap, and it’s fast becoming the difference between delivering a strong busy season and missing a key commercial moment.”

Retailers, therefore, must seize control of their own fate by strengthening their grip on the international legs of their supply chains.

“Delays at customs affect 88 per cent of retailers, but more businesses are taking important steps to tighten upstream co-ordination, share data earlier with essential partners, and smooth handoffs at critical choke points. You can really see reliability improve when these steps come together.

“The bottom line is that we’ll see investment continue to be directed into the parts of the chain that strengthen flow and reliability. That shift is already happening, with a greater focus on building supply chains that stay dependable in tough conditions and are even sharper in good ones.”

Speed and reliability are essential

Despite global headwinds, customers seem unsympathetic to supply-chain issues, as cost-of-living pressures mean they are more careful with their spending than ever. “Consumer expectations for rapid delivery remain high, reinforcing the industry-wide ‘need it now’ mindset,” LVLY’s Russell said.

“To meet these demands, we have strengthened our last-mile capability by partnering with DoorDash, enabling less than 1-hour delivery of flowers and gifts to areas surrounding our dispatch locations. This collaboration enhances our ability to provide customers with an ASAP delivery service, aligning with evolving expectations for speed, convenience and reliability.”

Appliance giant Winning Group, too, has doubled down on adapting to focus on performance during the tough last mile of delivery. “Delivery is increasingly a key competitive advantage,” its COO, Trent Allan, said. “Speed, flexibility, and transparency are driving both customer satisfaction and brand reputation.

“While Australia remains one of the most challenging countries for last-mile delivery, our country’s rapidly growing e-commerce market continues to drive demand, and retailers must invest in their end-mile experiences to stay competitive, meet rising customer expectations, and ensure reliable and timely deliveries.”

The solution? Implementing AI and new technologies with a smarter use of humans to navigate the bottlenecks. Alex Carter, David Jones’ head of digital experience and operations, argued that checkout speed, clarity of delivery promises, and payment flexibility would define the new leaders of the pack.

“Checkout and fulfilment is where margin and brand trust will be won or lost,” Carter said. “AI will power faster experimentation, automated QA, predictive merchandising, and rapid content scaling. This is less about replacing people and more about increasing team efficiency, accuracy, speed and productivity. If you don’t get on board now, you risk being left behind in an environment where you may never catch up.”

RM Williams, another Australian retail giant, has not been afraid to take a fresh approach to next-generation challenges. “We are in the middle of one of the biggest transformations in our history,” Peter Ratcliffe, the company’s head of technology, told Inside Retail. “We are modernising our supply chain, automating our distribution centre, rethinking planning and product development and strengthening our cyber and data foundations.

“Technology, data, AI and machine learning are playing a big role in how we connect every part of the business, which will help us make smarter decisions, create efficiencies and enhance the experience for our team members and our customers, wherever and however they choose to engage with us.”

Sustainability is a key concern for customers

It’s not just about speed and efficiency. Consumers increasingly value brands and retailers that prioritise sustainability and genuine integrity. The problem, of course, is that meeting these requirements takes both know-how and investment. “With mandatory climate reporting now coming into effect in Australia, tracking and reporting emissions, including Scope 3, has never been more critical,” Winning’s Allan said. “Measures such as route optimisation, improved warehouse energy efficiency, and more efficient trucks are playing a key role in reducing environmental impact.”

In fact, the group’s logistics arm went further: It recently opened a new distribution centre that includes a recycling area to support its takeback programme for old products, alongside EV charging infrastructure and advanced environmental monitoring systems. “In another industry-first initiative, Winning Services launched an electric prime mover truck at [its centre in] Kemps Creek, marking a new phase in sustainable road transport in NSW. Replacing approximately seven daily return trips previously made by diesel trucks, the electric prime mover is expected to avoid over 80,000 kgCO₂-e annually.”

David Jones’ Carter puts it more simply. “Customers want to know the story behind their purchase – from materials and ingredients to ethical production and environmental impact,” he said. “Sustainability-led options and transparent disclosures will become an expectation by the customer.”

Even the concept of “newness” is being redefined. “Fast fashion is no longer the symbol of trend adoption; instead, customers are embracing recommerce, vintage, circular retail models, and high-quality, long-lasting products. Ethical sourcing, material transparency, and product longevity are becoming primary drivers of purchase decisions,” Carter continued.

Ultimately, 2026 will reward retailers that treat volatility not as a temporary hurdle but as a permanent operating condition. Those who invest early in resilience, technology, and sustainability will be the ones who turn supply-chain pressure into competitive strength.

This story first appeared in the 2026 Australian Retail Outlook.

Further reading: How retail COOs are pursuing a seamless supply chain

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