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How e-commerce is changing the modern supply chain

How e-commerce is changing the modern supply chain

Strategies in the supply chain have become very complex in recent years. Moreover, it becomes more complicated when companies start doing e-commerce supply chain management. It is difficult to fulfil the needs efficiently, especially for those who are unaware of the expectations and struggle to meet the shipment and customer demands. In addition to having a steady seller because demand changes with trends.

E-commerce Impact on Supply Chain Management

Whatever the reason, you are swamped with consumer trends that require you to diverge from traditional commerce.

Traditional Supply Chain Management

Traditional supply chain management is very straightforward. Fulfilment processes are based on the brand’s demand. Furthermore, most brands have well-established models for the determination of their consumer demands. They are based on seasonal shifts, advertisement channels, retail reports and projections of sales.

E-commerce and Modern Supply Chain

The rapid growth of e-commerce has tremendously changed the marketplace globally. Online consumers are in more demand today. Moreover, retailers and logistics are servicing those demands, trying to adjust to the market of online consumerism and modern supply chain management trends.

Warehousing and Shipment of Goods is Transforming

Some of the world’s biggest retailers, for example, Walmart may start using drones for their label inspection and inventory. Traditional retailers fear competition from online businesses, hence they are turning towards technology to speed up the delivery of goods. Moreover, one of the key elements to improve is inventory management software at the retail level. It will help retailers understand what is healthy and what isn’t. Additionally, retailers are experimenting with all options needed to deliver goods to customers.

Larger Fulfilment Centers

Since the e-commerce supply chain is growing rapidly, it is no surprise that demand for e-commerce warehousing has resulted in an increase in the number of national fulfilment centres. Moreover, the size and height of the structures have also increased. Approximately fifty years ago, the average height of a warehouse was twenty-four feet and by 2017, it had increased to thirty-three feet. 

It is indicated that bigger and better warehouses will be formed in the future. Some companies will seek warehouses with forty feet high ceilings, which are mostly of the mezzanine level. It is no surprise that e-commerce businesses are buying warehouses at a pace faster than mortar companies. According to the statistics, in 2016, e-commerce purchases grew by twenty-five percent in contrast to the six percent decline in brick-and-mortar purchases. Moreover, e-commerce companies need spaces that are three times bigger than traditional retailers.

The E-commerce Age is Shaped by Technology 

The modern supply chain has the potential to adjust to rapid e-commerce growth. The industry is also less expensive and more efficient compared to the previous years. According to the state logistics report conducted by the Council of Supply Chain Management Professionals, the overall logistics spending declined despite the increase in energy prices. The price of energy wasn’t a primary factor in depicting the logistic costs. Consumer demand for e-commerce deliveries is now the main determining factor for cost logistics.

Consumer Demands are Catered to for Better Return Methods

Consumer demands are changing with the logistics sector for better returns. E-commerce consumers want simpler and better options for returning purchased goods. Moreover, the logistics companies are adapting to their demand.

Final Verdict

From better AI to greater use of robotics in warehousing, the future of logistics will be depending on forward-looking adaptability. It will improve the growth of e-commerce that supply chains in the past could not even imagine.

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