Sweatpants, gardening supplies, zoom fitness classes – who would have been able to predict the sudden surge these items would experience in 2020? Product demand has always been tricky to predict, but COVID-19 has only made it harder. A study led by the University of Warwick found that 80% of products have experienced some sort of fluctuation in demand during the pandemic. It’s disrupted forecasts and created bottlenecks in networks.
With supply chains under pressure from both directions, many retailers have scrambled to introduce new warehouses in record time. However, the pandemic has proved a challenging time to seek warehouse space, with the UK Warehousing Association revealing that 90% of its members had reached full capacity by the first lockdown.
According to our latest Ecommerce Delivery Benchmark Report, retailers are responding by building more flexibility into their logistics network. In fact, 77% of retailers say this is a top priority for them in 2021. Here are some of the tactics they’re employing.
Resilient carrier ecosystems
One way of building more flexibility is in gaining easy access to a larger network of carriers. This becomes especially important in the sort of situations we’ve seen during the pandemic, where demand for certain items rapidly fluctuates.
For example, The Entertainer, the UK’s largest independent toy retailer, saw huge spikes in online demand for certain products like puzzles, games and craft items in the early stages of the pandemic. The Entertainer works with Metapack to flex between different couriers, which helps it react quickly to unanticipated rises in demand and handle massive volumes with ease.
The company also saw a general shift in demand from smaller to larger items, like swing ball sets and sand pits. In this case the wider carrier network ensured that the right carrier was selected to ship these differently sized items.
The case for automation
Surprisingly, the situation has strengthened the business case for physical automation. Hundreds of millions of dollars of venture capital have flooded into robotics startups since March 2020. Indeed, our Benchmark Report found that 82% of retailers plan to increase their investment in automation.
Robots and ‘cobots’ are safer to operate in the pandemic, and they offer a competitive financial alternative to staff salaries. For example, clothing retailer Superdry has deployed 20 Hikrobot carriers at its distribution center in Belgium and six at its distribution center in the UK, in Burton-upon-Trent. Shipping software can also help retailers add more automation into their process by generating fully compliant shipping labels and customs documents. They can also allow new shipping services to be added effortlessly. The best providers achieve this in lightning-fast speeds, via one integration.
The All-Delivery economy has brought huge opportunities. Ecommerce retailers are looking to leverage the current online boom, but in order to do so, they must be able to flex quickly and practically to scale-up to demand.
For more insights to thrive in the All-Delivery economy, read the Metapack Ecommerce Delivery Benchmark Report 2021.