True Logistics Visibility: Supporting E-Commerce
Almost every week it seems as though another retailer announces brick-and-mortar store closures, or there are new bankruptcy filings making headlines. With more and more people turning to technology in their everyday lives — often to the detriment of in-person shopping — capturing sales via e-commerce has never been more important for retailers. E-commerce transactions had a landmark year in 2016, and continue to grow every year.
According to the 2017 E-Commerce Benchmark Report by AAEI and Amber Road, 75 percent of global retailers surveyed said they currently offer an online sales channel, and 65 percent of those without one plan to implement one soon. Increased internet penetration across the globe has contributed to the consistent shift of consumers to online shopping, along with improvements in mobile technology that make online shopping possible at any time, in any place. However, this huge market opportunity associated with e-commerce comes with a heavy set of challenges and large pitfalls for retailers that aren’t prepared with the right solutions.
While rapidly changing technology can improve access for consumers, on the retail side that creates a high bar for selling to current customers and generating new business in a tech-friendly demographic. Consumers are accustomed to nontraditional shopping experiences offered by online giants like Amazon.com and Alibaba, raising expectations and lowering the threshold for tolerance of quality control issues or delays.
A retailer looking to offer a 21st century buying experience must itself embrace 21st century technology. Cloud-based global trade management (GTM) software that includes complete supply chain visibility can help support e-commerce transactions by clearly identifying every step of the process. Brands and retailers require the ability to source, manufacture and deliver products efficiently, while reacting to unexpected events quickly without souring the customer experience. The pressure on retailers is immense, as customers expect a convenient shopping experience married to superior quality with lightning-fast delivery.
As global trade regulations seem to be experiencing a major upheaval in 2017, most obvious in the U.S. but happening elsewhere too, retailers are further challenged by increasingly complex import and export regulations, product restrictions, hidden costs, and high shipping fees. The days of managing separate teams for each aspect of the supply chain along with reams of paper are long gone as GTM software makes heavier inroads with global companies of all sizes. There are several ways that GTM software can support an efficient e-commerce infrastructure:
- Product catalog management for a superior online shopping experience.
- Proper classification of goods in real time for cross-border orders based on descriptions from the product catalog, the country of export and each consumer’s desired country of import.
- Accurate landed costs and total cost calculations that include taxes and duties, which prevent underbilling or surprise customs bills for the consumer at the point of sale.
- Comprehensive database of global trade regulations, including restricted party screening and prohibited goods.
- Instant shipping updates for the shipper and consumer combined with real-time shipment tracking.
- Documentation requirements for any regulatory agencies that have jurisdiction over the product throughout the export and import process, including Certificates of Origin and/or Certificates of Compliance to prove traceability.
- Cybersecurity concerns can be mitigated when dealing with a trusted vendor to provide GTM solutions.
Improving efficiency throughout the supply chain requires total visibility in these areas, and managing them manually is a nonstarter in today’s fast-paced world. GTM software that can instantly determine the appropriate product classification is essential, as supply chain operators point to an increased need to accelerate time to market, eliminate waste and errors, and reduce operational and product costs. And, of course, all of this must be delivered with lower prices to attract and keep tech-savvy consumers with waning brand loyalty.
The shift to digital isn’t new, but global brands and retailers are turning towards e-commerce with increasing urgency as traditional sales channels dry up and the global marketplace expands. Ignoring the changing face of retail will put companies at a disadvantage, but attempting to tackle e-commerce without the right toolbox could be equally disastrous. As 2017 continues to change the face of the world, retailers should be ready and equipped to deal with regulatory and economic shifts to sail into 2018.
Gary M. Barraco is the director of global product marketing at Amber Road, a provider of global trade management software and solutions.