There’s no getting around it: The COVID-19 pandemic has already altered and will continue to reshape the retail landscape significantly. With one in four American businesses already in hibernation and more shutting their doors every day, retailers, distributors, suppliers and manufacturers who depend on foot traffic face losses they might not be able to overcome.
At the same time, essential businesses like grocery stores face an entirely different problem: keeping up with panic demands. Despite measures like shortened store hours and item limits that prevent hoarding, stores around the nation are still finding it difficult to keep their shelves stocked. Grocery supply chains are working overtime to meet needs, forcing many businesses to reassess how they manage inventory, process orders and fulfill them quickly and accurately.
Both of these issues are detrimental to supply chains — but there is an option to tackle them both: unified commerce. This disruptive supply chain concept, already growing in popularity, is seeing a huge boom and giving businesses the tools they need to survive. From helping brick-and-mortar stores transform into omnichannel ventures to accelerating order processing for essential suppliers, unified commerce will not only help businesses get through this pandemic but put them in a stronger position to grow and thrive in the future.
What Is Unified Commerce?
Gartner, leading research and advisory company, defines unified commerce as “the practice of providing flexibility, continuity and consistency across digital and physical channels to deliver a superior customer experience.” To us, that means aggregating key information across both supply and demand channels to provide our customers with enhanced visibility and insight into the appropriate actions that will lead to optimized results.
By pulling together signals from physical and digital sources into one unified portal, businesses gain more control over their supply chain which is proving to be vitally important during the current global pandemic. Having access to real-time information across the connected supply chain gives businesses the ability to adapt to changing conditions by using tools that leverage the wealth of connected companies to meet business needs.
How Unified Commerce Can Help Overcome Today’s Challenges
Eliminating Single-Channel Reliance
While brick-and-mortar sales have all but stopped for most retailers, e-commerce is seeing unprecedented growth. According to data from ACI Worldwide, the retail sector saw an astonishing 74% growth in online transactions in March, compared to the same time period last year.
The stark contrast between online growth and physical store losses illuminates the imperative for businesses to create an omnichannel strategy. When a business relies too much on a single sales channel, an event like COVID-19 can easily put that business at risk. A unified commerce approach enables businesses to pivot on the spot, using growing or steady sales channels to mitigate the impact of losses in those that are negatively affected.
The current COVID-19 scenario has shown us that reliance on a single channel extends beyond businesses that are only brick and mortar. To better serve the nation’s critical needs, Amazon has pivoted its warehouse operations to focus on essential items (medical supplies, home goods, grocery, etc.) at the expense of everyday items (games, music, electronics, etc.). This put many small suppliers who relied upon Amazon as their primary sales and distribution channel in a difficult position.
Small suppliers are now looking for options to fulfill orders themselves, find third party fulfillment options or diversify their sales channels by creating their own webstore or connecting to other marketplaces like Walmart.com, Google Shopping, eBay or others. A well-thought-out unified commerce strategy gives a business the flexibility to do any or all of those actions, thereby diversifying sales channels and increasing overall supply chain resilience.
Increasing Inventory Visibility
When COVID-19 shut down portions of the Chinese economy right after the multi-day celebration of the Chinese New Year, the inventory impact on retailers was like a sucker punch to the gut. While many had prepared in advance for the holiday and stocked up on two weeks of inventory, the shutdown came just as those stores were being depleted, with no way to restock. Then, only a few weeks later, the US saw a massive spike in sales for some items like toilet paper, which left unprepared manufacturers scrambling to produce and retail shelves empty.
No one could have predicted these events well in advance. But what they highlight is the necessity of having inventory visibility to respond to changes in the supply chain and marketplace. Unified commerce helps eradicate inventory inaccuracies, empower proactive response to demand shifts and increase supplier collaboration while making it easy to onboard new suppliers when existing ones can’t fulfill your needs. As a result, when the next unpredictable market shift happens, you’ll be able to quickly assess your inventory needs and demand to stay ahead.
Accelerating Order Processing
While industries like fashion are languishing without orders, companies that produce essential items like hand sanitizer or currently high-demand items like wine and beer can barely keep up. Rapid and accurate order processing is essential to keep your business moving during demand spikes via retail, drop ship or e-commerce orders. Many businesses are running into bottlenecks because they rely either on manual order entry (which is time-consuming and error-prone), or they are using on-premises solutions that can’t scale up to handle surging order volumes.
Unified commerce digitizes and automates order processing to increase fulfillment speed without sacrificing accuracy. Businesses can take advantage of tools like EDI to process batches of orders in mere seconds, product information management to manage rich, channel-specific catalog content and B2B/B2C webstores that extend their sales footprint into new markets.
Not only does the business’ digital footprint grow, but the time your team used to spend typing can now be spent in other essential parts of your business. Additionally, unified commerce is a digital strategy that uses a flexible, cloud-based architecture that is highly resilient and doesn’t require on-premise staff to support. All of this helps handle market unpredictability, as well as enabling businesses to handle expected spikes like holiday shopping, without having to invest in costly on-premises software and hardware.
Why Unified Commerce Can Help Achieve Ongoing Success
COVID-19 has taught us many lessons about supply chain preparedness. One key takeaway is that you can’t predict every market shift — no one can. Even the goliaths of each industry are being impacted right now, and some might not make it through. But the businesses that have been able to respond quickly, collaborate with their partners, rapidly connect to the established and emerging online marketplaces and adapt their strategy are not only managing to survive the crisis — they’re the ones who will thrive in the aftermath and beyond. That’s what unified commerce is all about: unifying all the parts of your supply chain so you can drive success together, even when you’re apart.
Blog post by Ross Elliott, President, TrueCommerce