Here’s the new delivery paradigms shaping the future of supply chain
KATIE KINRAID, general manager of BluJay Solutions (APAC), writes that to date, the entire supply chain has been orchestrated to service “demand”, while keeping inventory and logistics costs down. However, with the rise of the digital consumer and the “now economy”— where customers are expecting fast, premium fulfilment and delivery at little to no cost — the focus has shifted from forecasting product consumption to anticipating customer needs and catering to personal preferences.
Customer experience is becoming more critical to supply chain performance in the food industry. From Amazon to Uber Eats, HelloFresh to Deliveroo, it is the speed and convenience of virtual or physical delivery that thrills consumers and keeps them coming back. Alongside significant advancements in technology, particularly the smartphone, consumers have embraced immediate communication and come to expect instant service.
Businesses are expected to know who their customers are, what they want and, more importantly, how to get it to them in their moment of need. This means instant and accurately targeted communication, as well as almost instant delivery.
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The food industry needs to adapt
As this demand evolves and the now economy becomes an expectation, the food industry needs to adapt in order to keep up. This means understanding the shift in consumer behaviours and expectations, being aware of retail and supply chain advancements, and knowing how to leverage both of these things to achieve a competitive advantage.
In recent supply chain market research, two-thirds of the respondents reported that delivering an enhanced customer experience is a defined and measured objective within their supply chain organisations. This indicates that competing on customer experience is becoming a competitive differentiator for many organisations, and that competing on price is taking a back seat.
Organisations looking to innovate their supply chain should begin by asking a few questions to understand the problem or business opportunity they want to address.
- Is delivering an enhanced customer experience a defined and measured objective within the supply chain?
- What factors are driving supply chain and logistics innovation today, and what are the organisation’s biggest barriers?
- Which technologies will drive the next wave of supply chain innovation?
The Australian food industry seems to be catching on to the importance of customer experience. A good example of how local businesses are adapting to the now economy is Coles’ introduction of flybuys premium, which — taking a leaf out of Amazon’s book — gives members of this tier discounted groceries, free home delivery and even access to online video streaming! However, while the local food industry is moving in the right direction, there is a lot more to be done.
The most important lesson learned from companies that have been disrupted is the danger of becoming too complacent with the status quo. Organisations need to ensure that they stay informed of new technology trends and competitors and simulate “What if?” scenarios on an ongoing basis, while experimenting and testing new technologies and business models.
It isn’t necessary for organisations to rework their models entirely. Rather, the food industry should focus on nailing the basics and putting the customer at the centre of everything they do – communicate with the customer, be transparent with them and deliver on promises.
ABOUT THE AUTHOR: Katie is an innovative leader who keeps a continuous eye on the market for what’s next, while taking an active approach to understanding and listening to customer needs. Prior to overseeing customer adoption and growth in the Asia-Pacific region for BluJay Solutions, Katie had responsibility for global product strategy, market awareness, propositions definition, realisation, and product evangelism at Blackbay, a leading mobility-enabled solution provider.
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