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Deloitte Report: Ongoing Supply Chain Issues Warrant a Retail Reset in 2022

New year, same challenges. After facing nearly two years of shipping and supply chain issues riddled with carrier capacity crunches, increased shipping volumes, service delays, and a spate of surcharges and fees, retailers seek greater optimism and stability in 2022.

FreightWaves recently covered Deloitte’s new “2022 Retail Industry Outlook” report, based on insights from 50 senior retail executives identifying opportunities for a retail reset in the year ahead.

Among the biggest trends in retail e-commerce and supply chains for 2022 highlighted in the report:

  • Supply chains are top of mind – 80% of the executives surveyed believe consumers will prioritize stock availability over brand loyalty, meaning retailers will need to place inventory above all if they want to turn a profit. The report’s co-author recommends retailers gain as much transparency as possible from their sourcing partners while also bringing on new partners to expand their sourcing base and reduce the impact of widespread disruptions.
  • Automation is key – Half of the executives surveyed cited automation in fulfillment and distribution centers as a priority. The report recommends retailers automate their warehouse processes as much as possible and invest in automated technology for the last mile.
  • Data sharing and visibility – The Deloitte report highlighted the growing emphasis among retailers on data sharing and visibility for gaining an array of supply chain efficiencies. With the right data available, retailers can gain real-time insight into their end-to-end logistics and supply chain management processes to efficiently identify and address problems or patterns while enhancing the customer experience.

One other key finding spotlighted by FreightWaves highlights a problem that many shippers overcome by integrating Logistyx’s parcel shipping system with their inventory management, order management or warehouse management systems.

  • Focus on the last mile – According to the report’s co-author, one of the biggest obstacles facing retail executives will be reducing last-mile costs. With consumers expecting near-infinite fulfillment options, offering them all while keeping costs low is a challenge. Ship from store, curbside pickup, buy online pick up in store –– all are more expensive than a run-of-the-mill delivery.

In fact, integrating a parcel shipping system into the technology stack can make omnichannel fulfillment more cost-effective and offer retailers some much needed relief from common fulfillment challenges.

Parcel Shipping Technology Sets Retailers Up for Success

A cloud parcel shipping solution not only makes omnichannel fulfillment options more profitable for retailers; it can help them effectively tackle each of the above trends and more to succeed in e-commerce by enabling:

Supply Chain Transparency

Embracing the cloud can help retailers anticipate risk while improving transparency and coordination across the supply chain. Digitized supply chains are faster, more accurate, and more flexible than other supply chains, and each is anchored by a single system of record for the organization.

When integrating a cloud parcel shipping system with a supply chain technology stack – including inventory management systems, warehouse management systems, and order management systems – retailers create a synchronized supply chain ecosystem, and they have a more complete view of their entire order fulfillment and logistics operations. Then, when a customer places an online order, the supply chain ecosystem identifies the best location from which to ship the product, automatically selects the “best cost” carrier service for each order according to parcel origin, parcel destination, carrier contracts, and business rules, and creates or acquires the tracking, labels, and documents. Once the parcel leaves its destination, the inventory management or order management systems are updated accordingly.  The retailer has created a streamlined, closed-loop order fulfillment workflow, and ultimately is able to satisfy customers’ e-commerce fulfillment requests while driving down costs.

Carrier Rating and Rate Shopping

Leveraging automation in e-commerce fulfillment processes can help retailers provide optimal service and streamline the customer experience without increasing costs. One quick win when it comes to automation is automating carrier rating and rate shopping. Parcel shipping technology automatically rates shipments and compares those rates within the retailer’s contracted carrier network for the same weight, destination, and delivery times, selecting the optimal carrier for the shipment at the time the order is received. For retailers wanting more control, the parcel shipping system can also “filter” these rate shops through the retailer’s custom business rules, which can be turned on or off.

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Business Intelligence

A multi-carrier parcel shipping system provides retailers with state-of-the-art tools to analyze parcel shipping data and enable teams to make decisions with context. More sophisticated systems include native Business Intelligence that aggregates and standardizes shipping data across carriers, giving retailers unprecedented reporting capabilities and an easy way to visualize masses of shipping data.  Stakeholders can run rate simulations, compare “what if” to current transportation strategies, and set and measure parcel shipping KPIs.

In addition, parcel shipping software with Business Intelligence can leverage cloud native technologies such as Spark Analytics, Data Bricks, Azure Synapse, and more, which provide faster analytics and easier integration to IoT input. It can take raw data and apply Machine Learning (ML) algorithms to predict the impact of IoT events on the supply chain. For example, it can help organizations:

  • Evaluate omnichannel capabilities to better understand whether stores can ship based on space and inventory
  • Determine which types of orders can be shipped versus picked up
  • Analyze the impact of carrier capacity limitations and order demand, providing managers with the ability to pivot carriers and transportation budgets to match customer expectations

Ready for a Retail Reset?

As e-commerce continues to grow, Logistyx ensures top retailers and others with large fulfillment operations have the right mix of shipping and omnichannel capabilities at their fingertips, while tapping into more than 550 global carrier integrations for an optimal transportation strategy. In fact, Logistyx was named the #1 fulfillment software provider to Digital Commerce 360’s Top 1000 retailers for the third consecutive year .

To learn how you can improve your e-commerce fulfillment strategy and achieve a retail reset, contact us today.