Though it would seem the world is getting back to some semblance of normalcy after the pandemic, the global supply chain continues to face an uphill battle. Industries in every sector are challenged by rising costs, dwindling capacity in both freight and storage, and myriad disruptions that threaten their ability to conduct a viable business.
While nobody can absolutely predict what’s coming down the pike, we can make some educated projections based on current trajectories.
Perhaps most significantly, as the labor crisis continues to challenge suppliers at every link in the chain, technology has become an essential value driver. A recent report shows that venture capital investment in supply chain tech (with verticals in fulfillment, warehousing, freight, and supply chain management) rose more than 355% in 2021 over the previous year. The market for such technology is expected to exceed $6 trillion by the end of 2025.
Three Tips to Ensure a Future-Ready Supply Chain
As we swing into the next era of supply chain management, here are three key considerations to help you get your supply chain ready for the future.
1. Consumer expectationswill be focused on fast and free delivery
Before the pandemic, consumer expectations were trending towards greater convenience and low-cost or free shipping options, driven mainly by Amazon and other mega-merchants. Fast, free, same-day and even same-hour delivery options are desired and even expected by nine out of ten consumers, even though little more than half of all merchants offer these options.
As last-mile comprises more than half of the total cost of delivery, companies must reduce costs significantly to make it a viable option. Micro-fulfillment centers can save merchants up to 75% of warehousing costs, and we’re seeing the emergence of gig-economy-style apps that leverage unused space on private property for storage.
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2. A decentralized distribution model will become more common
Today’s consumers want their goods fast. The old distribution model (where goods are stored at a centralized location) may be more economical, but if it comes at the expense of customer churn, companies need to consider alternatives. Decentralized networks are becoming the preferred fulfillment solution to satisfy customer demand. Technology removes the complexities of managing multiple warehouse locations, putting these capabilities within reach for just about any merchant.
3. Increased demand for ethical and sustainable sourcing
Supply chain visibility is an essential aspect of process optimization, but it also supports sustainability and ethical sourcing in supply chain management. Today’s consumers demand more of the brands they support, so the ability to trace goods to the source and through every link in the chain is more critical than ever. Commodities most affected by these demands include luxury goods, wine, and cosmetics, but there is an increasing trend toward food traceability as well. Similarly, investors prioritize environmental, social, and governance compliance, and a transparent supply chain supports growth and investment in these areas.
DTS World Cargo helps you streamline freight forwarding and ensures your shipments arrive on time to meet customer expectations. We leverage the latest technology and forward-looking trends to ensure your supply chain is resilient and future-proof.
Get your supply chain ready for the future. Request a quote today.