COVID-19 has been impacting the United States since March. The resulting lockdowns and shelter-in-place orders have caused a shift in buying behavior among American consumers.
Varying product availability has been a key reason for these changing buying decisions, prompting consumers to choose between need and preference. Consumers’ increased desire to stay home has contributed to the shift as well, accounting for the rise of online shopping during coronavirus.
The supply chain has faced fulfillment challenges from this influx of online orders, along with a myriad of crisis-related disruptions including:
- Long wait times at warehouse depots
- Truck driver shortages
- Altered trucking routes
These issues have impacted consumers’ experiences and, ultimately, their expectations. To fulfill purchase orders and support customer retention in this uncertain landscape, companies have reevaluated their supply chain processes and adjusted their logistics frameworks.
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Improve Supply Chains, Boost Customer Satisfaction
Supply chain operations significantly impact customer satisfaction, especially for ecommerce orders. A few factors in particular influence customer satisfaction for better or worse, including:
- Price
- Delivery speed
- Service quality
Sellers that leverage technology solutions throughout their supply chain manage these components much more effectively than those that don’t. Technology gives businesses real-time visibility into every link of their value chain, helping them identify inefficiencies and other issues that impact the customer experience. Ultimately, a company that seeks to protect its hard-earned reputation and gain repeat customers should optimize the following parts of its supply chain:
- Sourcing: Product manufacturers must develop strong supplier relationships to ensure a constant influx of raw materials. Maintaining a steady flow of all required materials puts sellers one step closer to meeting demand for final products. This point is especially important for best-selling goods. Companies that take the time to develop their supplier networks are able to negotiate lower rates, streamline operations and learn which vendors can execute with short lead times and less risk. Strengthening partnerships with suppliers also helps a seller identify vendors that prioritize responsible sourcing. With growing consumer preferences for corporate social responsibility, ethical business practices are another value proposition that impresses customers. Taken together, all of these competencies provide consumers with cost savings and better service.
- Manufacturing: Sellers are interested in producing products in as little time and for as little money as possible. However, they must integrate quality control into their production activities to avoid defects. This objective necessitates thorough production planning. Cost and quality typically have an inverse relationship, and it takes comprehensive and data-driven visibility for companies to strike the right balance between the two. Invest too little in the manufacturing process and the number of defective products will rise. Overpay for unnecessary manufacturing tools and costs will climb. It’s worth elaborating on this last point: A company’s ability to compete on a price basis starts with its supply chain. Reducing manufacturing expenses is key to passing cost savings along to customers.
- Warehousing: Warehouse performance plays into customer satisfaction as well. Online businesses must overcome the unpredictable nature of ecommerce demand — and in the COVID-19 environment, extreme volatility — to make the most of their warehousing operations, which have expanded over time to include returns processing, cross-docking of back orders and more. Companies can improve warehouse functionality by performing regular audits, benchmarking against industry standards and paying special attention to floor plan. There are a variety of ways to design efficient warehouses like using all available space, tailoring procedures, avoiding congestion of goods and more. Incorporating suggestions like these helps businesses maximize warehouse value, hit target inventory levels and expedite delivery.
- Distribution: In terms of distribution, the primary concern is keeping the appropriate amount of products in stock. Online shoppers are quick to jump to competitors when the products they’re looking for aren’t available, so sellers must achieve the right amount of supply at the right time. Technology provides support here. Companies that have advanced forecasting tools enhance their supply and demand planning abilities. From there, allocating resources becomes easier. Businesses that can successfully meet demand cultivate trust among end customers; optimizing activities at distribution centers is essential for that.
- Transportation: Making high-quality and humanely sourced products in record time and for a low price means absolutely nothing to customers if items arrive late or damaged. That’s why sound transportation management is critical. To ensure end consumers receive goods on time and intact, sellers must coordinate a number of shipping aspects. Online shoppers expect sellers to offer multiple delivery options, send prompt order confirmations and provide frequent tracking updates. Communicating potential delays and remedies for issues is a plus. In order to meet these high standards, sellers should work with an experienced logistics provider. A trusted shipping partner will be able to provide the deep visibility that’s required to keep customers happy and book the necessary transit to deliver goods.
This insight, coupled with recent statistics on buying behavior during the pandemic, equips companies with information they need to make business decisions going forward.
