It’s no secret that several major changes in technology and consumer expectations are redefining the supply chain. The art of getting materials to a manufacturer, the finished product to a store and then into the hands of the consumer looks drastically different than it did even a few years ago.
As both the retail and logistics industries move farther into 2017 and beyond, we foresee even more changes to continue; changes that will not only continue to redefine the supply chain, but that will have a ripple effect on other industries.
Middle-size companies given the chance to survive
First of all, we expect to see more “shortening of the barbell” in retail. What does that mean? Imagine a barbell weight that has two heavy pieces on each end that are connected by a thin hand-holding device. Previously, you had to either be a major retail entity on one end or a super hyper-local entity on the other end of the so-called barbell to have any success.
Companies like Amazon are pushing from the middle to not only offer higher-end items in the fashion industry, but also more day-to-day goods that consumers can now have delivered to their door instead of purchasing at their local store.
This doesn’t mean, however, that the middle-size guys are out. This just requires them to be more forward thinking and make much-needed concessions such as free in-store pickup. Walmart, for example, already excels at this and will continue to make changes to fight against Amazon.
This style of growth will mean two things: more retailer-specific offerings (such as cake mixes you can only purchase at a specific retailer), and increased efforts to draw shoppers further into a store when they arrive to pick-up their deliveries.
Burgeoning last mile delivery
We’re also seeing a growth in the last-mile delivery service area, which led to our drastic growth in 2016 both in Northwest Arkansas and Tulsa. We expect that last-mile delivery services will continue to expand as retailers are vying to meet consumer delivery expectations. That said, we also see that once the market becomes saturated and technology is enhanced, that some of those last-mile delivery services will consolidate.
As the companies consolidate in favor of more technology such as using drones, we expect that, like in manufacturing, that the jobs will shift towards managing and monitoring the technology involved in last-mile delivery. We expect that there will never be a time when the human component is not vital to last-mile delivery services and supply chain logistics overall.
Growth in locally-made products
This trend has become increasingly popular in recent years, be it products made in a specific region or even simply in the United States as opposed to being imported. This means more jobs, increased warehousing growth, and the distinct opportunity to shorten supply chains. Instead of “last-mile” delivery services, we believe it will mean logistics providers will be called upon to provide delivery services from the manufacturer straight to the store or consumer.
Whether you’re a small, hyper-local company in Northwest Arkansas or Tulsa, or if you’re a larger company that wants to improve its supply chain, let us know how we at On Time Logistics can serve your needs.