Characteristics of Multichannel Supply Chain Strategy
Changes in shopping behavior and consumer preferences have accelerated the shift toward multichannel supply chains, giving consumers more options in how they purchase goods. Customers can buy items by placing orders online or stepping into a physical store; however, these multiple supply chain channels are usually kept separate.
With increasing dependence on technology, supply chain issues such as the shortcoming of siloed systems have been exposed. A recent IDC report highlights a critical gap: the “lack of supply chain visibility and resiliency to see necessary changes in time to react to them effectively.” Multichannel supply chains fall prey to this problem.
Read on to learn more about the differences between multichannel and omnichannel supply chains and some supply chain strategies you can implement to grow your business.
Why Omni is the New Multi
Like multichannel supply chains, omnichannel supply chains seek to serve customers across channels. They differ from the multichannel alternative by integrating the entire supply chain, giving customers a seamless experience. Customers can choose how to order a product and control shipping and delivery. Such a supply chain aims to bring consistency and reliability across channels.
Hence, multichannel is more of an operational view of how customers will complete each transaction in specific channels. In contrast, omnichannel is a vision toward orchestrating the customer experience across channels to make it consistent.
These terms are becoming increasingly indistinguishable. Customers can shop in a physical store while simultaneously using a mobile app. This becomes evident in the concept of ‘showrooming’; customers can visit a physical store to assess a product and then purchase it online for the lowest price.
Various Supply Chain Strategies to Implement
Only 34% of North American and European retailers provide the option to buy online and collect items in-store, despite consumers preferring to buy products in multiple ways. This is because shipping costs and delivery time make this process inefficient.
Every company will have a unique supply chain that faces different challenges, meaning they can’t adopt strategies in a one-size-fits-all approach. Here are six key strategies you can use as a multichannel business.
Make Inbound Supply Chains More Efficient
Whether you’re an omnichannel or multichannel retailer getting products delivered on time is vital for your business. This can be done by:
- Understanding existing problems.
- Identifying responsible vendors.
- Launching a vendor compliance program.
- Assessing cheaper and faster ways to do inbound and fulfillment activities.
- Determining how to eliminate receiving dock and truck yard congestion.
Increase Capacity of Warehouse
Growth in sales might necessitate needing more storage facilities. However, you don’t have to move to a new warehouse or center; poorly designed distribution centers will bring capacity issues and inadequacies, irrespective of their size. You can delay moving to a new facility by addressing some fundamental principles, such as the 28 principles for warehouse layout design and productivity.
Maintain Accuracy in Paperwork
The fundamental technology for warehouse automation is barcode technology. It allows you to track the movement of all activities within a warehouse – what is happening, who is responsible, and when processes are taking place. Increasing the usage of barcodes can pay dividends both in the short and long term.
You should use barcode technology for tasks including receiving, putting away, replenishing, picking, packing, shipping/manifesting, returns, value-add functions, and labor tracking.
Effective Labor Management
If you cannot automate your business, being able to manage labor more strategically should be a primary goal.
To optimize labor management, evaluate how labor changes can lower costs per unit, line, order, and carton shipped and make changes accordingly.
Manage Shipping Costs
Outbound shipping is usually one of the most expensive processes in any business. Some ways to manage these costs are:
- Analyze shipping data and evaluate whether there is room for improvement in rates.
- Consider the viability of a company-wide shipping system that could lower costs.
You can find the best shipping partners and reduce costs with Euminart. We enable you to explore over 30 third-party partners, negotiate lower rates (up to 50%), and leverage our network of services across 200 countries.
3rd Party vs. Internal Fulfillment
It is essential to consider whether your company should continue to operate its own facility or switch to a third-party logistics provider. Can you achieve quicker delivery with multiple distribution centers provided by a third party? The larger you grow and the more complex your supply chain gets, the more cost-effective it becomes to include a third-party logistics provider.
Are You Ready to 2x Your Growth?
Implementing these various strategies can go a long way toward accelerating your business’ success. They will make your multichannel supply chain more efficient by lowering costs and delivery times, leading to more satisfied customers.
You can also grow quickly by using Euminart, an AI-powered omnichannel platform that lets you access warehousing, logistics, and fulfillment services through one accessible channel.
So what are you waiting for? Get started today!