Will 2020 be the year retailers digitally transform their supply chain ops?
Satisfying customers is a tricky business. In 2019, retailers paid special attention to digitizing the shopping experience and removing friction in the selling process. In 2020, I expect retailers to move their focus to digitizing back-end supply chain operations to grow long-term loyalty and market share.
Here’s what trending in omnichannel fulfillment and delivery:
CSCO is directly accountable to customers
Consumers will increasingly select retailers based on the quality of their delivery, returns and after-the-order service. Chief Supply Chain Officers (CSCO) will upgrade the people, processes and technology needed to flawlessly execute. Retailers will improve transparency, efficiency and satisfaction by implementing a strategic supply chain based on integrated ordering and inventory management, augmenting their supply chain suites with new technologies like AI, IoT, blockchain, robotics, drones.
After-purchase processes are front-and-center
It’s easier to keep customers than acquire new ones, right? Smart retailers will cultivate loyalty by fulfilling their brand promise — and do so without breaking the bank. Look for more chains to invest in systems that provide universal inventory visibility, intelligence, rules and order processing automation to optimize the flow of goods and associated costs.
Retailers will apply new criteria when forming third-party fulfillment and delivery partnerships. Retailers will form flexible new fulfillment venues and relationships and will no longer completely entrust the last mile relationship solely to a third-party partner. Universal visibility will extend beyond retailers to suppliers, carriers and manufacturers as well as to delivery partners and customers. Predictive fulfillment becomes a possibility when visibility and transparency are in place across the extended supply chain.
Free & fast forever
Retailers must figure out how to fulfill on-demand without eating up profits. A complex and expensive process, the last mile even keeps Jeff Bezos up at night. Suppliers will step-up drop-shipment capabilities. Some retailers will invest in vertical supply chains and other automation, transparency or innovative value propositions for customers to happily accept more cost-effective delivery options.
Standing out from the crowd is more than a fun front-end. Retailers will win long-term loyalty and profitability based on what happens after an order is placed. The ability to fulfill on-demand — in accordance with one’s brand promise — is the ultimate brand experience.
- Will IoT reinvent the supply chain? – RetailWire
- REI ventures into dropshipping – RetailWire
- In power move, Walmart expands Delivery Unlimited – RetailWire
- Will free deliveries for Prime members make Amazon the driving force in online grocery? – RetailWire
- Why supermarkets are building ‘dark stores’ – CNN
- Amazon’s Costly Push For Last-Mile Warehouses Sent Profits Down 26% – Bisnow East Coast
DISCUSSION QUESTIONS: What supply chain advancements do you expect the retail industry to make in 2020? Which of the areas listed in the article do you think will have the biggest effect?