Rising demands in e-retail segment fast-tracking supply chain

While the development of the e-retail industry has been exponential, it has also led to some challenges due to amplified expectations among consumers.
Rising demands in e-retail segment fast-tracking supply chain

The e-retail industry is one of the fastest growing industries in India. Driven by increased digital penetration, a rise in ownership of smartphones, shift towards digital payment alternatives and multilingual e-commerce platforms, the e-retail industry in India has witnessed a robust growth in the last few years. From its nascent stages in the mid-2000s, the e-retail industry in India jumped to a phenomenal market value of USD 19.5 billion at gross level. With continuous automation and evolving consumer behavior, the growth of this segment is expected to continue enjoying an upward trajectory.

While the development of the e-retail industry has been exponential, it has also led to some challenges due to amplified expectations among consumers. With major technological advancements automating the e-retail space, a need to reinvent the supply chain processes to support changing market dynamics has been felt, especially in warehousing and logistics. Further, with e-retail giants like Amazon and Flipkart establishing their own captive logistics units for fulfillment needs, it has become even more important for industry players to incorporate technology as quickly and comprehensively as possible. As automation elevates the e-retail segment, the supply chain has also been fast-tracked through adoption of modern-day technologies to help e-retailers address challenges and meet increasing consumer demands.

Optimization of workflow processes

Since retail supply chain is highly dynamic and consumer-centric, it requires a great amount of synchronization and collaboration. As more and more people opt for e-retail purchases, the demand for a flexible supply chain has risen exponentially. Optimization of workflow processes through automation is the solution. Therefore, leveraging supply chain automation solutions can result in better efficiency and lowered operational costs. These solutions include distributed order management for multi-channel operations, warehouse management and execution systems to control the movement and storage, and adoption of technologies such as IoT, blockchain and AR, etc. While the inherent nature of supply chain is highly fragmented, optimization of workflow processes has the power to bring together disintegrated sub-processes and make one unified end-to-end journey.

Meeting heightened consumer expectations for order fulfillment

According to a study conducted by Zebra Technologies titled ‘The New Retail Mandate: 2018 Shopper Vision Study’, 66% of shoppers prefer same day or next day delivery. These heightened consumer expectations of delivery have shaken up the supply chain paradigm. Since a retail supply chain has many intermediaries, this results in a complex assortment of many touchpoints, increased human intervention, more wait time, inventory wastage, pilferage and stock losses. Therefore, supply chain automation accelerates delivery to consumers and reduce picking errors and pilferage by reducing the number of touchpoints.

Further, to meet the rising consumer demand for timely and flexible product delivery, e-retailers have been increasingly opting for express logistical services. Due to the time-bound, door-step delivery nature of express logistics, it has become an indispensable part of the e-retail industry in recent times. Express industry is continuously evolving and building capabilities to cater to the complex nature of operations of the e-retail industry. Express logistics has helped e-retail players adapt to a consumer-centric delivery model and meet the rising expectations, thereby enhancing end consumer experience.

Making the domain future-ready

Supply chain processes are traditionally human-driven, wherein humans operate the machines. Integrating modern-day technological tools throughout the process can increase both efficiency and reliability of the e-retail supply chain. Automation of the entire supply chain from end-to-end has the ability to improve service levels while saving costs up to 30%, while providing a higher level of visibility across the entire network. Autonomous warehouses are also coming into the picture. Industry players are looking to invest in robotics and IoT systems that would remove the ‘human’ component from the process and transfer all the mundane operations onto machines. This will further enable the executives to find new avenues for progression and drive charge for the entire business instead of spending time on the day-to-day repetitive processes. While making the domain future-ready seems like the ideal thing to do, technology needs to be incorporated comprehensively to ensure a seamless transition towards a completely automated supply chain. 

The article has been penned down by Chander Agarwal, Managing Director, TCIEXPRESS    


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