Online retailers are facing a major crisis. Since COVID-19 hit, reduced headcount and social distancing practices within the walls of warehouses and distribution centers mean retail businesses are struggling to manage the stresses and strains of increased e-commerce demand, which is forecast to continue to soar.
While any increase in sales is good news, there’s evidence that retailers are being overwhelmed because of an inability to process increased demand from shoppers moving online.
In fact, one in three consumers have been let down by an online order since the COVID crisis, and four out of 10 buyers say online deliveries are taking longer to arrive since social distancing restrictions were introduced. Furthermore, 25 percent of shoppers experienced items being listed out of stock after purchase last year.
These types of operational problems have been a major theme since COVID. Widespread stock-outs and delivery delays due to sudden increases in demand have significantly damaged shoppers’ relationships with online brands, with 34 percent of consumers saying that unreliable delivery has lessened their trust in online shopping altogether.
Nailing Delivery Expectations
In order to operate viable and successful online businesses long term, vendors must process online orders more quickly, more accurately, and in a manner that safeguards both their employees and the end user.
However, lost in the desire for growth, too many brands lack the agile digital retail operations to thrive in today’s multichannel e-commerce environment and successfully manage all the key operational touchpoints, including inventory, customer communications and, of course, delivery.
This ultimately leads to weak infrastructure that can’t support demand, service failure, and poor customer experience.
Automation is the Answer
In this current climate, retailers and their warehouses need to maintain flexibility and scalability. Automating retail workflows, from order processing to inventory and shipping, removes the risk of human error from these repetitive manual tasks. It also ensures orders can be picked and packed efficiently and quickly, boosting employee productivity.
Because automation optimizes e-commerce workflows, retailers’ labor pools can be better allocated to other areas of the business — e.g., to support growth and innovation within the business.
While Amazon.com remains faster than every major competitor, research suggests firms that automate shipping can increase "orders out the door" by up to 92 percent. This means smaller brands have an opportunity to present themselves as a truly viable alternative to the online giants.
Automate First, Grow Later
No doubt, there's an abundance of exciting technologies that support new sales avenues, such as voice commerce, augmented reality, new social media outlets (Reels, TikTok), and even in-app purchasing via platforms like WhatsApp.
But retailers need to be wary of prioritizing growth at all costs. Before exploring new sales avenues, firms first must ask themselves if their current setup is sophisticated enough to support a further increase in demand. And if it isn’t, they must embrace technologies that sync sales channels and orders with inventory and shipping so customers get the right product on time, every time, alongside tools that can automate order management and fulfillment. This will enable retailers to exceed expectations and maximize customer lifetime value.
The truth is, companies that are only concerned with acquisition post-COVID will always be at risk of being overwhelmed by demand and delivering a substandard experience.
The brands that instead focus on creating an outstanding experience at every stage of the purchase journey, alongside strategically implementing automation to stay true to customer expectations, can look forward to greater retention, profitability, and success over the long term.
Derek O’Carroll is the CEO of Brightpearl, a retail operations platform for retailers and wholesalers with a clear mission to automate the back office so merchants can spend their time and money growing the business.
Derek O'Carroll is CEO of Brightpearl, a cloud-based ERP for retailers and wholesalers. Recognized as a leading retail expert, his mantra is to deliver on Brightpearl’s mission to automate the back office for today’s merchants.
Brightpearl is a retail operations platform for retailers and wholesalers with a clear mission to automate the back office so merchants can spend their time and money growing the business. Brightpearl’s complete back office solution includes financial management, inventory and sales order management, purchasing and supplier management, CRM, fulfillment, warehouse management and logistics.