• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Blogs » Think Tank » How E-Commerce Became Crucial to Retail Survival

Think Tank
Think Tank RSS FeedRSS

How E-Commerce Became Crucial to Retail Survival

How E-Commerce Became Crucial to Retail Survival
July 16, 2020
Fred Loeffel, SCB Contributor

For many years, e-commerce has been on a steady rise, making up roughly 9% to 10% of total U.S. retail sales. For emerging brands, it has been a vehicle for going from unknown to household name. For others, e-commerce has lived primarily on the whiteboard as a problem to solve in the years ahead.

Due to the COVID-19 pandemic, there’s no longer any time to wait. E-commerce now equals survival. Retail sales are expected to drop more than 10% in 2020 as a result of the pandemic, according to eMarketer. Meanwhile, that same report indicates that e-commerce will experience an unprecedented jump of 18%, reaching $709.78 billion, in 2020.

The pandemic and quarantine have put e-commerce into fast forward. Five-year plans are being tossed aside, with business leaders forced to take immediate action to strengthen this channel.

This rapid adoption of online shopping is providing new insights and lessons, some of which will last long past the pandemic. Pre-COVID-19, the top two categories for online shopping were consumer electronics and apparel/accessories. Due to stay-at-home policies, the industry is experiencing a massive shift in the types of products people are purchasing online. According to eMarketer, categories such as groceries and health products are on a sharp incline, expected to grow by nearly 41% in 2020.

Clearly the pandemic has unlocked a wider array of online shopping. No longer just fixated on gadgets and clothes, shoppers are now purchasing more items essential to their daily lives. For example, health products that previously relied on storefronts to showcase their brands must now act quickly to bolster their e-commerce channel, lest an upstart competitor fly by.

Change is occurring not only in the types of products consumers are buying online, but also in how those they’re being physically acquired. Retailers are being forced to adapt, and flexibility is vital. Kroger converted a store in Cincinnati to pickup-only service. Major brands and retailers such as Gap and Nordstrom are offering curbside pickup at dozens of stores. Many more are launching, or scaling up, their own curbside operations.

The pandemic has forced brands to reach customers where they are, which is easier said than done. Brands are facing a bevy of new challenges in logistics and supply-chain, such as the need for visibility of inventory, constantly adjusting fulfillment capacity, delivering goods of different sizes, navigating last-mile delivery, and managing product returns efficiently to keep customers happy.

Formidable as they are, these challenges often represent just the tip of the logistical iceberg that companies face. Brands that have struggled to accelerate e-commerce operations in the past are now potentially up against an existential crisis caused by the pandemic.

Brands face three common issues today: (1) they’re not deeply integrating their physical and digital logistics capabilities, (2) they’re not adequately leveraging their wide-ranging assets, and (3) they’re neglecting analytics.

To overcome these hurdles, brands must have a “omnichannel” mindset. This means rethinking inventory and ordering procedures, especially around sourcing, allocation and processing. It also requires making better use of order-management tools, both to track orders efficiently and to allocate orders to the right locations (according to service, distance and availability rules). It involves deploying systems that can reroute orders in real-time (say, if there’s an unexpected stockout in a particular location). And it means using tools that offer “one-view” inventory, to ensure that managers have full visibility on all items up for sale.

Those companies that have excelled in e-commerce before and during the pandemic know hassle-free shopping is vital to their success. Reliable delivery is one key element. So is having goods available with minimal wait time when customers want them. An intelligent order management system (OMS) that offers a single inventory view and can determine the closest distribution center or storefront to access the product (as opposed to placing the burden on the consumer to find it) provides the ease and efficiency that is now paramount. It also reduces the risks and costs of over- or understocked inventories, and it enables brands to adopt sophisticated analytics that can better predict trends.

Agile distribution networks are equally critical for handling the ebb and flow of demand, especially during uncertain times like the present. Stores, for example, can be used for a wider range of purposes if they’re more tightly integrated into logistical networks. By incorporating machine learning, brands can optimize where orders are coming from, to leverage local stores instead of distribution centers for e-commerce fulfillment Some might be employed as warehouses that offer “buy online, pick-up in-store” options. Still others could serve as drop-off points for product returns.

Change is constant. Online shopping is at its highest levels to date, but shoppers will certainly return to stores at some point. Brands must be able to flex up or down to navigate the new post-COVID world. With this omnichannel mindset and approach, brands have a stronger ability to serve customers wherever they are, the visibility for intelligent decision-making, and the levers and flexibility to adapt quickly and overcome the obstacles of the future we will undoubtedly face.

Fred Loeffel is executive vice president of strategic development at Geodis Americas.

Data Management (Big Data/IoT/Blockchain) Supply Chain Security & Risk Mgmt E-Commerce/Omni-Channel Retail

RELATED CONTENT

RELATED VIDEOS

Subscribe to our Daily Newsletter!

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • karen-jones.jpg

    Watch: Four Industry Disrupters Impacting Logistics

    Data Management (Big Data/IoT/Blockchain)
  • THE SPACE AROUND A COMPUTER KEYBOARD IS CLUSTERED WITH IMAGES GENERIC SHIPPING BOXES

    How Suppliers Can Overcome E-Commerce Supply Chain Challenges

    Data Management (Big Data/IoT/Blockchain)
  • A SEATED PERSON HOLDS A SMARTPHONE, SHOPPING

    Retail Consumer Data: The Key to Personalization, or Privacy Violation?

    Regulation & Compliance
  • TWO MEN IN SUITS ENGAGE IN CONVERSATION ACROSS A COFFEE TABLE HOLDING AN OPEN LAPTOPIN AN OFFICE

    For Shippers, Disruption Means Opportunity to Rethink Carrier Strategy

    LTL/Truckload Services
  • A BLUE AND WHITE JET BLUE PLANE FLIES ABOVE A YELLOW SPIRIT PLANE ON THE TARMAC OF AN AIRPORT

    Biden’s Antitrust Push Across Agencies Is Working to Block Deals

    Air Cargo

Digital Edition

Scb q1 2023 cover

2023 Supply Chain Management Resource Guide: Packing for a Difficult Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Holman Logistics Honeywell Intelligrated
IFM Infor Inmar
Keelvar Kinaxis Korber
Lean Solutions Group 2H Liberty SBF Locus Robotics
Logility LogistiVIEW Lucas Systems
MCA Connect MPO Nvidia
Old Dominion OpenText ORTEC
Overhaul Parsyl PMMI
QIMA Redwood Logistics Ryder E-commerce by Whiplash
Saddle Creek Logistics Schneider Dedicated Setlog Holding AG
Ship4WD Shipwell Shyft
Sourcemap Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing