Experts are warning China’s recent string of tight lockdown restrictions are about to send another shock through global supply chains—possibly worse than Wuhan’s lockdown at the beginning of the pandemic. China’s President has not budged on his “zero-Covid approach,” which has many residents in tight lockdown conditions and desperate for food and basics. 

While ports remain open and full of trucks struggling to unload cargo, shipping containers continue to stack due to strict permit regulations that prevent workers from leaving home to work if there’s even just one positive case in their high-rise home. 

In many cases, Shanghai’s port is running out of capacity for many types of cargo as importers cannot collect their goods and with the recent outbreak in Guangzhou, export volumes out of China will begin to increase drastically.

This is disappointing and frustrating for eCommerce businesses trying to get products to American consumers, given that it imports more goods from China than anywhere else in the world. Once lockdowns end (or more likely just lessen), there will be an “overwhelming movement of goods that cripples supply chains” similar to the last reopening in 2021.  

So, what’s ahead and how do you plan accordingly?

Landscape is More Competitive
According to a recent industry report, eCommerce will account for 20.4% of global retail sales by the end of 2022— up from only 10% five years ago – confirming the eCommerce space is becoming more crowded. Covid definitely helped to expedite this shift, but the race to gain customers’ attention through online advertising propelled it as well.

Recent changes to Apple’s privacy updates in iOS 14.5 now prohibit cross-app data sharing unless users opt-in, halting this gravy train of constant lead generation and impressions drastically.  Ramifications from this shift have been felt immediately across Instagram and Facebook advertising platforms and are much less effective for digital ads, shifting eCommerce businesses to focus more on newer advertising channels like TikTok and Snapchat.

With market saturation from the influx of new eCommerce businesses and less effective marketing channels, customer retention is another way to reduce customer acquisition costs.  Creating and implementing a differentiated customer experience has never bene more critical for eCommerce businesses before, as many seek options other than large-scale retailers with empty shelves and out of stock inventories online.

Global Expansion
As businesses continue to see impacts of lockdowns throughout the world, it is important to continue to expand into new markets and provide products to and purchase products from areas of the world that are untapped and open.

A recent survey showed that 76% of online shoppers have made purchases on a site outside their own countries, a shift that is likely due to continued supply chain issues with major retailers.  Consumers are tired of empty shelves and out of stock options online, so they are going directly to eCommerce business sites to purchase goods—making marketing and the need for automation of backend fulfillment and shipment absolutely critical without the support and lead of larger retailer processes. Cross-borders business will also require adjustments to eCommerce business operations as governments seek to protect shoppers and online retailers from fraud.  

There has never been a more critical need to shift to automation as there is now.  Little to no room for error and a steep increase in competitors offering identical or closely similar products requires efficiencies in an economy where supply chains are halted and consumers want their products.

Simplify with OPAL’s 4-in-1 Software Solution
EDI | Order Management | Warehouse Management | Shipping

OPAL is the innovative solution to simplify and automate your small to mid-sized to enterprise business fulfillment needs in today’s rapidly transforming retail world.  

As complications continue to arise around the world and supply chain issues continue to grow, it is time to enhance your systems through automation with OPAL to keep up with this competitive industry. 

To learn more about how OPAL has partnered with many to scale their business to new levels of success, click here.

Click here to book your customized demo today.  We are here to support you through this time of change and are here to help you innovate and thrive!

No one could have predicted Russia’s invasion of Ukraine to have such a long duration, and consequently has set off a series of new supply-chain bottlenecks around the world. 

Though they are not responsible for producing computer chips used by global automakers, Ukraine is the world’s leading source of neon, a gas needed for the lasers used in the chip-making process.  Fortunately, many chipmakers stockpiled neon ahead of the invasion and sanctions blocking trade, however there are serious concerns for the long-term availability of the gas.  

Germany is heavily reliant upon Russian energy and suppliers across Eastern Europe, and has posted the steepest one-month drop on record. Factories are facing diesel and parts shortages, as well as delays moving cargo through key North Sea gateways as their traditional travel paths have been extended to avoid off-limit zones.

In addition, Covid surges across China have led to temporary lockdowns, as the country sees it’s worst outbreak since the early days of the pandemic.  With factories closed, and only truly essential workers able to leave home, the disruption of production of finished goods is monumental.

China is home to close to one-third of global manufacturing and produce goods like Toyota and Volkswagen cars, Apple’s iPhones and components like circuit boards and computer cables.  Unfortunately, the global supply chain is paying the price as the country as chosen a zero-tolerance approach to outbreaks that call for stringent lockdowns and mass testing to eventually resume production.  

As global supply chain challenges continue to rise, nearly 80% of leading supply chain players surveyed said they’re accelerating their digital transformation due to the disruption of the pandemic.

Digital Transformation

As companies were prepared for the supply chain challenges of the past few years to continue, they were not however prepared for this current environment and short-term recovery is always a painful process.

Nearly 64% of supply chain leaders are increasing tech investment in technologies – including AI, predictive analytics, inventory and network optimization, and many, many more. All around, this will help elevate the industry but now is the time increase tech investment in your eCommerce business.

Automation

One comprehensive software solution reduces the cost of multiple software packages needed for your order processing and fulfillment needs, so that you can keep up with increasing consumer demand.

It improves order accuracy to 99% as well as drives labor costs down so that you can fulfill additional orders immediately without the added expense of hiring, training and retaining (the even trickier part in a labor shortage).

Pick, pack and ship becomes the primary focus of the team, as well as inventory optimization through automation. This allows you to have real-time data to make decisions, know your products and make informed decisions as this volatile market continues to shift.

Reduce Expenses

One comprehensive solution drastically reduces EDI expenses. As connection to all retailers, supplier and warehouses continue to increase, finding a software that includes the expense and simplifies the process is critical.

Strengthen Relationships with Retailers

Consumers are patient, but it is critical for eCommerce businesses to optimize delivery time as best as possible. Improved technology and automation provides real-time data on inventory and delivery details that provide a transparent communication between suppliers and retailers and customers.  Everyone is aware of the numerous supply chain issues, but communication is key to better set expectations of delivery.

Simplify with OPAL’s 4-in-1 Software Solution
EDI | Order Management | Warehouse Management | Shipping

OPAL is the innovative solution to simplify your small to mid-sized to enterprise business fulfillment needs in today’s rapidly transforming retail world.

As complications continue to arise around the world and supply chain issues continue to grow, it is time to enhance your systems through automation with OPAL to keep up with this competitive industry.  

To learn more about how OPAL has partnered with many to scale their business to new levels of success, click here!

Click here to book your customized demo today.  We are here to support you through this time of change and are here to help you innovate and thrive!