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Demand & Inventory Planning

Welcome to the New Supply Chain

Demand & Inventory Planning
August 11, 2020
5 min read
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Ware2Go’s CEO Steve Denton explores how the Coronavirus pandemic has accelerated a shift in consumer shopping patterns and how supply chains must adapt to meet new customer expectations for their digital shopping and delivery experience. The demands of the new supply chain require businesses to adopt the concepts of Acceptance, Flexibility, and Acceleration to thrive in this new era of logistics.

Originally featured on Forbes

By Steve Denton, CEO, Ware2Go

Many social norms look much different today than just a few short months ago due to the effect of the global Coronavirus pandemic. While some of these changes will be temporary —  people will in fact return to concerts, sporting events and churches — one aspect of the economy that has shifted permanently is the supply chain.

Social isolation has driven explosive growth in online commerce, leading transaction volumes to rise 74%  across most retail sectors from March of this year. Our own survey data shows that 87% of Americans are now shopping online. E-commerce is now mainstream, and the truth is that online ordering – both direct from the manufacturer and from resellers – is the easiest and most efficient it has ever been for consumers who now expect to have essential goods delivered to their doorsteps in just a few days. 

What’s more, our data also shows that 67% of Americans are working from home, and while many will return to the office,  others will not, accelerating the previously established trend of remote work. Lockdowns and quarantine measures compelled workforces to implement new tools to ensure high levels of productivity and collaboration in remote working, making video conferencing and learning management systems a new staple of the workplace. 

Together these cultural shifts have pushed us firmly into the era of B2E, or “Business to Everyone.” Quite simply, the supply chain has long needed to adapt to the reality that customers no longer see themselves as B2C or B2B, but simply customers. To compete in today’s environment you have to meet them in the sales channel or media where they want to engage and you must also deliver to them quicker than ever before. The pandemic accelerated this reality, putting us on a transformative path. 

The new supply chain revolves around the three key concepts: acceptance, flexibility and acceleration.

Acceptance begins with the understanding that the supply chain will not “return to normal”. The permanent changes are a new era of consumer expectations, revolving around fast, low-cost delivery – right to the front door – and the fact that regular shopping trips have become a thing of the past. This fact is held up by our survey data, which showed that 64% of Americans have replaced weekly shopping trips with ordering online, and are trying new online vendors every day to fulfill their regular shopping lists and even to obtain specialty items like vitamins (34%) and pet supplies (28%).

Flexibility is another key tenet of the B2E supply chain. The business models of B2B and B2C will evolve into an omnichannel model, enabling companies to leverage supply chain vendors for a broad range of capabilities. This will allow merchants to deliver to any type of customer, in any location. This kind of flexibility requires a myriad of supply chain and logistics capabilities, such as trucking and delivery, LTL (less than truckload) and small package handling, and international and postal shipping. A fully equipped B2E supply chain will also integrate white glove services for home delivery and temperature control for perishable items. The striking number of capabilities required to effectively work within the B2E framework requires companies to either build or buy a solution, which is why the right partner that can offer a range of flexible and adaptable capabilities without being capital-intensive is crucial to the success of this reimagined supply chain.

Acceleration is the final element of the new B2E supply chain. Many of the changes we are seeing now are not new. The digital transformation and supply chain changes were already underway and were merely accelerated by the pandemic. In the same way that the supply chain has become more adaptable, the “commerce engine” has also evolved. Consumers require maximum flexibility when it comes to the way they interact with businesses complete transactions. That could mean working with a sales or service rep, buying online, or using a proprietary app. An enterprise that is backed up by a supply chain capable of serving a diverse array of customer needs can get out in front of the market and build meaningful brand-to-consumer relationships with lasting value.

The pandemic has certainly caused a great deal of upheaval and sadness in our personal and professional lives, but it has also shown us how capable and adaptable business and society can be. In a few short months, we have seen major shifts in our sales channels and supply chains and have found new ways of working with our customers, partners and employees. 

As a society, we will always find a way to forge a path forward. The adoption of the B2E mindset will only continue, and in the words of a fellow CEO of my acquaintance, “This event is taking us where our business wants to go, just faster.” And I couldn’t agree more, because the genie is truly out of the bottle when it comes to the new supply chain, making B2E an economic mainstay. Welcome!

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