Omnichannel — Why it is the future of supply chain post COVID-19

Team Shadowfax
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Theglobal pandemic has the entire world in lockdown with a significant impact onboth human lives and livelihood. Talking about businesses, both offline andonline business models have taken a beating, with substantial supply chain disruptionsand changes in demand and revenue patterns.

Evene-commerce giantslike Amazon have not been able to cushion the impact of the virus (and theensuing lockdown) on the supplychain management, with Prime members having to wait for a couple ofweeks for products they previously received in a day.

Onthe other hand, the local Kirana storesin India have emerged as superheroes, offering quick delivery solutions andbetter customerservice.

Andthat’s exactly where the learning lies for retailers in this lockdown — that is— reduced reliance on e-commerceplatforms and major re-planning of logistics for store-to-home deliveries,to meet the emerging business norms during and after the pandemic.

Anotherimportant consideration is the digitization of supply chains solutions to make them omnichannelinstead of multichannel,effectively breaking down the organizational silos and bridging the gap betweenoffline and online to meet the new demand patterns of the post-COVID-19 era.

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Reinventing the Supply Chain in the Wake of the Coronavirus

Thedisruptions caused by the coronavirus have impacted every step of the supplychain — including the last-mile delivery,which is affected by lack of proper route planning, drivers, and otherresources. It is also a fact that the disturbances caused by the coronaviruswill lead shoppers to spend more time online as compared to shopping in stores— straining the supply chain further, especially the last mile.

McKinseyhas shared a six-point program to revamp the supply chain in the face of thecoronavirus pandemic. One of these steps focusses on reassessing the logisticcapabilities. Whyis logistic management important? It is essential for meetingdemand through an optimized warehouse and route planning, by keeping in viewthe hotspots and other restricted areas in real-time.

“In a time of crisis, understanding currentand future logistics capacity by mode — and their associated trade-offs — willbe even more essential than usual, as will prioritising logistics needs inrequired capacity and time-sensitivity of product delivery. … To improvecontingency planning under rapidly evolving circumstances, real-time visibilitywill depend not only on tracking the on-time status of freight in transit butalso on monitoring broader changes, such as airport congestion and borderclosings. Maintaining a nimble approach to logistics management will beimperative in rapidly adapting to any situational or environmental changes.”— McKinsey

covid-19 and omnichannel logistics

Inthis scenario, major retail brands, whether it is Nike, Spar, or Samsung, wouldhave to start utilizing their stores as inventory points or dark stores forfulfilling online orders.

Withexisting stocks languishing in various physical locations, partnering with adigitally forward 3PL company couldfacilitate an omnichannelsupply chain.

Thesesupply chain ecosystemsaccept onlineorders according to the location of the customer (for existingand future stocks in various locations), and then seamlessly deliver theseorders, from dark stores to homes or other delivery locations, as specified bycustomers.

Therecent multi-billion dollar deal between Jio and Facebook supports this view,wherein tech giants are coming together to create a hyper-local online shopping and delivery system. However, a keyenabler in any such model, as also pointed out by McKinsey above, is thelogistics and distribution capability of a retailer.

For example, adistribution center in a hotspot may see lesser demand while another distributioncenter in a green zone may register higher demand. To keep up with theseconstant changes, retailers need smart logistics with an extensive distributionnetwork.

Real-timechecks, automated systems, data analytics, and automated route planning offeredby technology-drivenlogistics companies like Shadowfax could be vital in fulfillingsuch changing demand patterns efficiently and swiftly while keeping the costsin check.

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Ifyou are looking to transform your supply chain for more agility, transparency, and resilience, a technology-first 3PL companycan help you bring about the transformation.

Get in touch to know more.

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