E-commerce, new retail and the importance of the Supply Chain

We have been hearing about the growth of e-commerce and online sales for some time now, which represent an ever-increasing share of retail revenue. In view of the current situation with the Covid-19 pandemic, this growth was boosted and forced companies in the sector to adapt to this new reality. According to research by Neotrust/Compre&Confie, it is estimated that e-commerce in Brazil had 5,7 million new customers between April and June, peak months of social distancing measures.

Figure 1: E-commerce sales between March and July. Source: Folha de S. Paulo

One of the main characteristics of companies prepared to stand out in this scenario is the flexibility of the supply chain to meet the demand of different channels, from the traditional physical store to the direct service of consumers who shop online. To have this flexibility and manage the supply chain well, companies need to use efficient order processing systems, delivery routing and technologies capable of predicting market behavior based on consumer purchase data. Another factor of great relevance in retail, both online and traditional, are the strategic partnerships with suppliers, enabling end-to-end visibility in the chain through the sharing of information in real time.

Each of these characteristics points to the reality of the future (and why not the present?) of retail: a market of great operational complexity that must be managed with focus on consumer needs and that, for this, has in supply chain management its greatest competitive advantage.

It is increasingly common to hear about retailers opening distribution centers and taking over the management of order delivery, even when the products are not located on the company's premises, which highlights the importance of the supply chain in the sector. The new retail will be marked by the efficient management of the supply chain through the use of technology and the high representation of e-commerce. Anyone who fails to keep up with these trends and make the necessary investments to gain consumer attention will have great difficulty ahead.

E-commerce and New Retail is one of the aspects that will be addressed in the International Supply Chain Forum this year, as well as Digital Transformation of the Supply Chain, Transport & Infrastructure and Reinventing the Supply Chain. ILOS will promote the Forum between October 13th and 15th, for the first time 100% online. To stay on top of the best market practices and find out about innovative solutions that are being adopted by industry executives, don't miss the opportunity to participate in this edition!

References:

Economic value - Retail manages the delivery of products and changes the logistics sector

Forbes - Can supply chain be the MVP in retail's future?

Folha de S. Paulo – Digital commerce gains 57 million consumers and retail says they are here to stay