THE CHANGING FACE OF DISTRIBUTION MANAGEMENT
Change is the only constant of every growing business today. The ability of a business to adapt to these changes determines its success. One of the major changes we have witnessed recently is the evolution of the e-commerce industry. Retail e-commerce sales worldwide amounted to $1.86 trillion in 2016, alone. This figure is estimated to reach $4.48 trillion by 2021.
The boom in e-commerce has also brought new developments for the distribution management system. The flow of products from manufacturers to consumers has been altered significantly, owing to new technological advancements and business processes. Modern distribution systems, which can easily transport goods to the consumer’s doorstep, are increasingly becoming more popular.
ENTERPRISE APPLICATIONS FOR DISTRIBUTORS
Until quite recently, distributors had been reluctant to invest in IT. Of course, there was much less to buy, and vendors mostly relied on proprietary technologies. But now, defending their traditional roles and to create new sources of value, distributors are starting to apply enterprise applications in supply chain management to gain a competitive advantage, according to a report titled The e-Changing Face of Wholesale Distribution.
Today, there are courier dispatch management software solutions, designed for same-day, next-day distribution for the e-commerce and warehousing industries. One such application is Xcelarator, Windows-based software that can be operated on Safari, Internet Explorer, Firefox, and Chrome on workstations, laptops, mobiles, or tablets. This courier dispatch application includes management and real-time data generation for distribution and cross docking operations, warehousing, on-demand, routed and scheduled work; basically all aspects of the dispatch system, in a nutshell.
Such enterprise applications are helping vendors to control costs, reduce inventory, grow revenue, and improve customer service, in their attempt to defend and expand profit margins.
LOGISTICS AND WAREHOUSING
Technology may provide the virtual platform for e-commerce growth, but logistics and warehousing provide the vital physical platform.
Reports suggest that parcel and express delivery has surpassed railroads, making it the second largest logistic option after motor freight. In 2016, spending on package delivery services jumped 10%. The report also stated that cutting-edge technologies have brought new advancements in sectors such as warehousing and parcel delivery. The parcel carriers and warehouses have taken advantage of the ever increasing e-commerce volumes to raise their rates and, hence, have continuously reconfigured their networks to provide faster delivery to consumers.
Warehouses are also being built in proximity to large, dense population centers, to facilitate quick delivery. Earlier, companies used to build these in remote locations to save on rent, but now the next-day delivery criterion is being replaced with a same-day and one-hour delivery, making it imperative for companies to store their products in areas close to the target population.
We can see that while the whole distribution system might be more complex in the future, it sure will be more efficient, benefitting the consumer. Developments in infrastructure and technology, such as solar power, autonomous driving, and energy storage, might even make it cheaper.