A Guide for B2B Distributors
Digital Disruption in the Supply Chain
The digital economy is disrupting the world as we know it. The meteoric rise of B2C (business to consumer) eCommerce in retail continues to send shock waves through the industry, and the impact reverberates beyond Amazon and eBay to B2B (business to business) companies everywhere.
While retailers scramble to adjust to the new frontier of online consumerism and the modern supply chain, the logistics sector is saddled with the task of servicing those demands. The rapid expansion of eCommerce through the supply chain in recent years has blazed new trails from which many B2B distributors were previously insulated. B2B distribution pioneers who equip themselves with the right tools to forge ahead will have the best chance of staking their firm claim in the online space.
New Territory, New Challenges
As with the introduction to any uncharted territory – which the eCommerce landscape is for many B2B distributors – comes a deluge of new challenges to face, intimidating obstacles to navigate, and tough questions to answer. For B2B distributors, eCommerce brings intense pressures to provide web experiences that please their customers and keep them loyal. It’s a significant challenge to pursue, let alone achieve, this economically because the majority of these companies are up against scale.
Think industry mammoths – the Amazons and Walmarts of the world. The few, the huge, wielding the size and resources capable of bringing in the latest equipment and software as it comes to market, sharpening what is already massive competitive edge. At the end of the day, it’s very difficult – if not impossible – to execute an eCommerce strategy effectively, in volume, without technology.
All Roads Lead to, and Begin with, a WMS
While this town may not seem “big enough for the both of us” – especially when one party is a titan – for many incoming B2B contenders, with the right mindset, eCommerce still presents significant opportunity. In fact, the time is ripe for B2B distributors to boldly navigate a digital space their peers may still be too timid to explore. For those willing, the intrepid B2B distribution visionaries, the bearings needed to launch a successful journey can be found right in their own warehouse.
The path to getting there involves undertaking the following three steps:
Step 1: Improve inventory management
Recognizing that the key to business success is improved inventory management is step one. Look for ways to generate real-time data for optimizing the movement and storage of inventory as well as delivering the more efficient management of personnel and materials. For example, identify tools that can improve a company’s bottom line by reducing costly shipping errors, which always comes with the positive byproduct of increasing customer satisfaction – one of the most important keys to eCommerce success.
Step 2: Enhance warehouse efficiency
This step means understanding the factors that contribute to warehouse and fulfillment efficiency such as visibility, organization, accuracy, and speed – and start by getting your facility in order. If there are boxes in the aisles, inventory scattered across bins, and trash on the floor – finding product is a challenge, forklifts get bottlenecked, and putting stock away is difficult.
More handling means additional labor, so design your processes to handle inventory as few times as possible. The solution here is to review and refresh business processes, get the right technology in place to support them, and make sure every employee knows how to make best use of the system.
Step 3: Identify and implement technology
The third and final step is to identify and implement the technology necessary to achieve each element of better inventory management. Take a WMS (warehouse management system), for example. Any company not already seeing the benefits of a highly automated WMS should strongly consider taking this next step. For those who are running on a WMS, evaluate if there are additional features and functions that make sense to expand with. For example, enabling additional modules like built-in small parcel / less than truckload (LTL) manifesting and shipping, or truck shipping based off route / stop and delivery confirmation.
The tools provided with a WMS enable a level of speed and accuracy that’s just not possible in manual, paper-based warehouses. Even distributors with small eCommerce engines driving single-line orders out all day have reported experiencing better receiving and shipping with a WMS, with exceptionally high accuracy rates on shipping line counts across the board.
The increased visibility you get with a WMS allows shipping departments to look at in-progress orders and alert carriers if any orders are remaining — before they shut that truck door and pull away. And, when it comes to speed, which is paramount when it comes to e-fulfillment, simply having the ability to quote shipping prices to customers upfront through an online store can be game-changing.
Setting the Pace with Technology
As the supply chain continues to evolve, robotics, the Internet of Things and other advancements will continue to bring major opportunities as well. The days of delivery by Pony Express are long past. In terms of B2B distribution, modern eCommerce demands a completely different breed of horsepower, and technology is that engine.
The rapid expansion of eCommerce has punctuated an era when stagnant warehouses and distribution centers were designed simply to meet the demand created by retail sales. The next evolution has revealed itself to be a complex technological infrastructure servicing today’s booming internet economy. Companies who neglect to adapt do so at their own peril.