2017 was among the most pivotal years in the history of the retail industry. A record number of brick and mortar locations closed, but the industry still grew in overall revenue, eCommerce continued to grow and impact the market, and growing supply chain complexity accelerated the demand for digitization, automation, and visibility technology. Retail trends have always had a massive impact on supply chains, but considering the current rate of change retail is experiencing, we look to industry predictions and consider what they might mean for supply chains and technology in 2018.
The Amazon Effect Continues
The driving force behind the retail industry’s transformation is the customer experience. More specifically, consumers have grown accustomed to the Amazon experience—high product availability, fast and inexpensive shipping, and accurate tracking and updates—and they’ve begun to expect a certain level of convenience in all of their shopping. eCommerce is only going to get bigger, and these trends are going to continue. The difference is going to be that we’re more aware of what is happening now, and even small retailers can make smart decisions to compete.
Supply chain automation technology allows companies of any size to ship products quickly and efficiently. It enables companies to provide their customers with accurate shipping information, lower delivery times, and competitive pricing, ultimately resulting in the eCommerce experience they’ve come to demand and expect.
Amazon is expected to sign on more third-party sellers
If you can’t beat ‘em, join ‘em, and that’s what a lot of third-party sellers are expected to do about their Amazon problems in 2018. If you’re a retail company, especially a retail company doing eCommerce, you’re already competing with Amazon, luckily Amazon prides itself on being a single-source for just about everything, and providing that level of inventory requires partnerships (or the occasional acquisition). Amazon’s third-party partnerships are mutually beneficial—Amazon is able to expand their offerings, and third-party sellers gain access to one of the most widely used retail channels in the world.
Companies who wish to partner with Amazon, however, will have to keep up with demand or risk falling out of favor with the eCommerce giant. This is yet another instance where a failure to efficiently manage your supply chain could cost you your business.
On-Demand Freight
Despite some early expectations, 2017 was a relatively underwhelming year for on-demand freight services (think Uber for trucking), but that doesn’t mean it won’t happen in 2018. A growing eCommerce market means that last-mile is becoming more important, but also more complex. Same-day delivery, shorter delivery windows, more and more small parcel deliveries—all of these things point to added complexity with very little time given to sort things out. That could be huge for on-demand delivery services. What’s more, is that it could give local retailers, even mom and pop shops, a simple way to provide same-day deliveries. There are still some kinks to work out of on-demand freight services, but when tied into a digitized supply chain it becomes a viable option.
Automation, Digitization, and Visibility
The overall trend that you should be taking notice of is that supply chains must become much more efficient, and they must do so relatively quickly. Companies will look for solutions that allow them to manage all of their shipments across all modes from one single source. They’ll gravitate towards whatever solution provides them with the most accurate information in real-time.
That means companies will put increasing emphasis on modern technology while making decisions about third-party support and partnerships. During our recent summit, projectAUTOMATE, Elaine Singleton, VP, Supply Chain, Technicolor sat down to discuss how leveraging modern technology has enabled technicolor to track shipments in real-time, normalize data, and more closely monitor shipments down to the content of each box. She spoke about Technicolor’s priorities as they select a new TMS partner, “We are only doing it with those TMS providers that are API ready, and can handle the technology and the feeds.”