The length of supply chains and the resulting high operating costs remain major challenges for Georgia’s retail sector. The Retail Association says developing logistics centers and introducing centralized store supply could significantly streamline the process.
“Neighborhood chain stores can receive up to 50 different suppliers a day, each with separate transportation, fuel, labor and other operating costs, including specialized vehicles such as refrigerated trucks. In addition, a chain may work with thousands of producers and importers, handling each delivery separately,” Retail Association Executive Director Sopho Kashakashvili told BMG.
Under a centralized supply model, products from different suppliers would first be consolidated at logistics centers and then distributed to chain stores through a unified system. The sector says this would make supply more efficient while also reducing traffic flows in cities.
The need to optimize supply chains is particularly important given the high level of competition in Georgia’s retail market. While some foreign markets are dominated by 3–4 major chains, Georgia has up to 20, with retailers individually receiving products from thousands of distributors, producers and importers. The sector also expects market development to encourage greater consolidation among distributors.
