Supply Chain Briefing

June 8, 2020

E-Commerce & the Rise of Online

According to the statistics as well as client commentary, e-Commerce sales and online everything is on fire:

  1. According to data from Adobe Analytics, the second half of March saw a 25% increase in e-commerce sales.
  2. Even more impressive, Adobe said that April saw a 49% increase in U.S. e-commerce sales!
  3. Of ALL our clients, the only unanimous area of growth during COVID-19 was in e-commerce sales.
  4. According to a Gartner CFO survey, 74% intend to shift some employees to remote work permanently.

Thus, the key question is whether you are proactively thinking about online opportunities. If not, get ready to see your competitors rush by.

What Should We Consider and/or What Impacts Could Arise? 

Undoubtedly, you should be thinking about online from all angles:

  1. E-commerce (B2C): If you haven’t started offering e-commerce capabilities, you better evaluate rapidly and get on board. There are several options for how to pursue this opportunity. You can offer direct e-commerce with your website. You can go through a partner with key customers and folks such as Amazon. The bottom line is that your customer doesn’t care how you provide the capability but they expect to be able to order easily.
  2. B2B: If you serve other businesses, you cannot ignore these trends because you don’t sell to consumers. Your customers expect a B2B customer portal with the same type of e-commerce capabilities that Amazon provides. We have been helping a client with a systems roadmap, and it is quite clear that the “80/20” from the customer and sales viewpoint is Amaon-like capabilities (with an almost exclusive focus on B2B currently). Nothing else is sufficient.
  3. Supply chain partners: What are your customers, suppliers and other supply chain partners offering?
  4. Employees: Remember, your employees expect you to have Amazon-like capabilities and online capabilities as well. This perception spills over into all aspects of the business.
  5. Online is more than B2B/B2C: Have you thought about how COVID-19 has forever changed the way we do business? After all, if Gartner thinks 74% will change to remote work in some fashion, that is a HUGE change. How will that change your industry, your supply chain and your employees’ needs?

E-commerce was already on the rise, and COVID-19 gave it a strong boost. As with everything, there are advantages (such as the consumer gaining quick delivery of essential items) and disadvantages or challenges (managing freight costs, reconfiguring warehousing operations and space requirements, implementing technology rapidly, figuring out how to be environmentally-friendly delivering to tons of consumers and many more issues). Those who are most successful in proactively thinking through these considerations and creating strategies will thrive whereas the rest are likely to struggle significantly. Which avenue will you pursue? Read more about this topic as well as your strategy, priorities, key trends, and your restart recipe for success in my eBook,  Future-Proofing Manufacturing & Supply Chain Post COVID-19 . If you are interested in a rapid assessment, please contact us.