By Joe Choa, Managing Director on Apr 22, 2020 3:00:28 PM
As the COVID-19 situation unravelled in the past weeks, it spurred a series of events across the region, including our nation’s circuit breaker period. We have since seen multiple waves of panic buying frenzies in Singapore and neighbouring countries.
For brands and retailers, it translated into a serious supply chain issue, with inventory running out of stock both on online channels and on at physical stores. These events also prompted consumers to realise the impact of supply chains on daily living and served as a reminder on why we have to secure our supply chains against systemic shocks such as this one.
This outbreak is a classic example of a black swan event – an event that was not foreseen and with severe impact. It should also remind us of the more immediate need to deal with white swans in our midst – issues that are much more common, visible and easier to manage including items going out of stock after a customer’s online order comes through. While white swan events may seem more common, they are often the tipping points that contribute to the largest and most problematic supply chain disruptions. And one answer to reducing white swan events is pursuing an omnichannel logistics solution.
Beyond just a buzzword, the goal of omnichannel is to bridge online and offline retail with an integrated supply chain to deliver smart, personalised and seamless experiences for its users. This also enable brands with a real time visibility to their inventory, improving demand forecasting to maximise sell-through and create an effective process for returns management.
Without a full overview of product inventory and location, brands are left with limited assumptions about their inventory at best. This could lead them with either too little inventory or worse, too much inventory with increased spending in storage costs and product obsolescence.
Alternatively, retailers are forced to markdown their products to reduce holding costs. This is an especially big problem for fashion, beauty or other brands that capitalise on trends because there is a finite window to launch and get their products out to the public.
With a single, real-time view of inventory tracking across the entire inventory and fulfillment network, companies can optimise their order management processes to better address demands in the market. This would solve a lack of accuracy in inventory levels across channels, reduced margins due to product markdowns and unplanned expedited shipping charges.
Omnichannel is not just a buzzword to use, being able to accurately forecast demand means brands are able to better meet consumer needs. As the largest and fastest growing B2C eCommerce market globally , Asia Pacific is witnessing an increasing amount of eCommerce shipment activities on its stage, adding to layers of complexity in the region’s supply chain network.
Inaccurate forecasting is often a missed opportunity for brands because it contributes to backorders, leaving customers waiting to receive their products. This is a problem today because customers don’t usually have the luxury or patience to wait for their products they can easily get from a different outlet; ultimately, this dilutes customer satisfaction and loyalty.
Equipped with the capabilities of accurately forecasting demand, tracking and predicting inventory levels, brands can minimise inventory stockouts ahead of time by identifying products that are most likely to experience backorders based on consumer patterns and the volume of activities at each store location. This will not only keep current customers happy but also invite new customers to purchase products in stock.
Leveraging real-time data analytics, brands can better anticipate and quantify relevant cyclical selling trends or seasonal selling periods to maximise sell-through. This enables them to fulfill lead-time promises to customers more quickly and balance inventory to their advantage between online and offline channels.
Delivering on Deliveries
Omnichannel logistics can serve as a platform allowing businesses to manage, organise and process individual and bulk delivery orders with ease and convenience. By using big data analytics, brands can pre-empt bottlenecks across the supply chain from pallet to parcel.
With delivery volumes growing in tandem with eCommerce, smart solutions to track and trace customer shipments in real-time is important to ensuring that products are delivered to their doorsteps on time, at the right location and in perfect condition. This will help prevent any delivery deviations that are out of the brand’s control or visibility and protect the customer relationship.
Having a robust delivery network is also key to the returns process. Today’s eCommerce climate means free and efficient returns are expected and demanded by consumers, and any less will result in harming the consumer experience and increasing operating costs for the brands.
Survival of the Fleetest
The COVID-19 has the potential to change the way of how consumer shop permanently and expedite the growth of a new consumer class that demand speed and convenience - a big bulk of which are eCommerce orders - omnichannel logistics is key for retailers to chart a new way forward to not only survive but prosper in an increasingly competitive climate by staying nimble and fast on their feet.
With a cohesive omnichannel strategy likely to be a very powerful differentiator for brands to ensure operational triumphs, brands should act on taking good care of white swans in their supply chain from inventory management, forecasting and planning and a fuss-free delivery experience to win the favors of this emerging group of customers.
As an omnichannel enabler, we empower homegrown and global brands to strengthen their presence in this region – through multi-channel marketplace management, real-time inventory management, integrated fulfilment for B2B2C, and through hybrid last-mile delivery – providing end-to-end seamless logistics solutions.