6 Realities of the Modern Retail Supply Chain
Retailers are dealing with changes in consumer habits and the explosive rise of e-commerce, which have transformed not only the small parcel economy, but the entire supply chain. Understanding the following six key supply chain realities will help improve efficiency, customer satisfaction and, ultimately, the bottom line.
- We're not slowing down: According to a Sealed Air survey, nearly four in five (78 percent) Americans think retailers should ship their online orders in 24 hours or less. In the e-commerce race, the fastest and most agile companies will always win, and the expectation of "how fast is fast” is changing by the day as some retailers add next-day or same-day delivery. Shaving a few seconds off the time used to package each item may not seem like much, but in an economy in which every second counts, it can mean the difference between you and the competition.
- Customer experience goes both ways: The overwhelming majority of consumers (94 percent) strongly prefer to complete returns using the original packaging in which the product arrived. Consider including a prepaid return label so customers only need to find the nearest mailbox.
- Less is definitely more: Consumers know waste when they see it. Excess air pillows or a tiny item swimming inside an oversized box makes a business seem inefficient. Consider investing in fewer, more protective materials. Doing so not only will save money in freight costs, but will also improve customer perception of (and loyalty to) your brand.
- "Recyclable" isn't enough: There's no amount of recyclable, biodegradable, reusable packaging that can wipe out the carbon footprint of a damaged item. Damaged items have to be returned, repaired, rehandled, repackaged and reshipped — all of which lead to a higher carbon emission footprint. Protect the item right the first time for the biggest sustainability gains.
- Packaging speaks volumes about the brand inside: Sixty-six percent of Americans believe that an item’s packaging tells them something about how much the brand cares about them. The e-commerce customer experience doesn’t end when the correct item is delivered on time. In fact, that’s when the actual physical customer experience begins. Brands that aren’t thinking beyond the doorsteps of their customers are going to lose them to those that are.
- Retailers are demanding more: Leading retailers are demanding tighter deadlines for deliveries from suppliers and threatening fines for late deliveries or the loss of valuable shelf space. That’s why investing in the right level of automation, logistics improvements, and packaging practices that reduce labor time and increase fulfillment speed now can mean staying ahead of retailer demands.
Looking ahead, it’s clear to see why businesses should prioritize supply chain efficiency and focus on using protective packaging solutions that support an enhanced brand experience. Those that do will continue to win with their retail partners and consumers.
Ken Chrisman is president, product care, at Sealed Air, a provider of innovative packaging and hygiene solutions.