The Impact Of e-commerce On Supply Chain Management

The traditional supply chain management approach was pretty simple. If you were a distributor, your fulfilment process was based on the demand created by brands and physical shops. Many companies have well-established algorithms for predicting customer demand based on time-tested advertising channels, seasonal changes, sales forecasts, and store data.

Volatility was quite minimal if you were a brand working within the traditional supply chain management paradigm, compared to what it is now.

You instructed manufacturers and warehouses to have a baseline supply on hand in order to accommodate for volatility and sales forecasts in your major channel. Additional supply was then determined by how much effort you put into developing a client base via auxiliary channels such as trade fairs, catalogues, and live events.

Spreadsheets and hard copy volumes served as the foundation for the whole procedure.

The effect of online purchasing on supply networks

Volatility became increasingly frequent when the internet and online buying entered the scene. The internet has the ability to magnify trends, and e-commerce makes it very simple to buy anything, at any time, from anywhere.

Furthermore, search engine algorithms may have a negative impact on your brand’s exposure.

The environment has changed and continues to shift significantly. The COVID-19 crisis in 2020 highlighted the instability of supply networks. Due to “pandemic pantry” preparations, sales of some consumer-packaged products increased by up to 305%. Brands were unable to anticipate this demand.

Fortunately, eCommerce was a benefit to businesses since several suppliers offered mobile applications for order sourcing. These applications depend on data exchange to allow suppliers to see retail inventory and place fast orders with manufacturers.

Supply chain management techniques for e-commerce companies

Importance of Supply Chain Management in the Modern-Day Business | Complete  Controller

Managing your supply chain with an integrated e-commerce store is tough if you do not have a plan in place to meet the flood of consumers and orders. Considering the following methods for simplifying your e-commerce operations:

  • Improve consumer proximity and warehouse capacity: The closer your warehouses are to your clients, the quicker you can deliver orders straight to consumers or physical shops.
  • Reduce shipping costs: Because you’ll most likely be saving money via automation and increased warehouse capacity, provide free delivery on orders above a specific amount, as well as incentives to bundle goods, such as price reductions and free shipping.
  • Add an order management system: Your OMS should be linked to your eCommerce shop, physical locations, logistics like integrated logistics company in Malaysia . As a result, the whole order management process is automated, working in tandem with each link of the supply chain to ensure customer satisfaction.
  • Items included in the kit: The technique of automatically producing and storing packaged goods together is known as kitting. You won’t have to spend additional time putting the bundle together and sending it out if consumers bundle goods online and make an order.
  • Invoice automation: Your customers may pay online and view all essential payment documents at any time using online invoicing. Orders will flow more rapidly through the supplier chain as invoices are processed more promptly.

It’s time to use technology to change your supply chain

Overall, simplifying your supply chain via automation offers an unexpected benefit: it enables you to spend more time listening to your consumers. You may work with ERP-integrated e-commerce software to offer your consumers what they want and need from the moment they click a button.