Supply chains are the lifeblood of most, if not all, businesses today. Keeping all supply chain components running as smoothly as possible ensures that your business can provide on-time delivery of products and services, especially with changing consumer demands and supply chain disruptions brought about by the COVID-19 pandemic.
The flip side for retailers is learning how to cope with increased competition, supply chain uncertainty, higher delivery costs and shrinking margins – all while still trying to satisfy consumers’ desire for low prices, omnichannel delivery options and a smooth customer experience.
Inflationary trends are influencing the world economy and directly impacting supply chain and delivery operations. Rising fuel prices is a good example of direct supply chain disruption, as well as manpower shortages which have led to higher labor costs with lower productivity. This combination of less consumer spending, inflation and higher delivery costs are hitting retailers where it hurts most – in the bottom line.
While the old adage that the “customer is king” may still be true, retailers cannot ignore that the pandemic induced hyper growth phase of eCommerce has passed. Now that growth has slowed and margins are tight, many retailers find themselves guided by keeping a lid on costs rather than pleasing customers no matter the cost.
Today, retailers must take a good look at providing the best possible service while increasing operational efficiency. This has resulted in a shift of priorities when selecting delivery management platforms: from consumer experience and customer service, to cost optimization. Customer expectations increased significantly over the past few years, meaning retailers need to offer multiple delivery options including next day or even same day delivery, in-store pickup, remote and curb-side collection, and free parcel shipping to satisfy their customers. However, these different delivery options require more flexible fulfillment operations and inventory management – for example, ship from store (to get inventory closer to the customer) and supplier drop-ship fulfillment.