The novel coronavirus or covid-19’s effects have rippled across the world; the global population fear not only disease, but also irrevocable changes to the economy that will change the notion of ‘business as usual’. This pandemic has changed the way we live, work and think, and these changes to our daily lives are going to have lasting effects that re-shape our politics and economy.
It’s important that we stay informed in this time and try to look towards a better, stronger future. We cannot be sure what the world is going to look like when the storm settles, but here are six predictions on how the business world may change once the world heals.
More online shopping
E-commerce has been gaining market share steadily and then rapidly since the ’90s, overtaking physical sales for the first time ever in 2019. With the spread of the covid-19, online trade in household goods and consumables has increased as the world stays indoors in an effort to stay safe and flatten the curve. With the public weary of disease transmission, e-commerce emerges as a safer alternative to brick-and-mortar trade and may dominate shopping the world over in the months and years to come. There is an opportunity for e-commerce retailers to reach new audiences in both the B2C and B2B markets. With businesses struggling to make ends meet, turning to selling physical products, digital products and even services online may be the solution many business owners are looking.
Before the outbreak, warehouses were extremely popular in real estate due to the explosion in e-commerce growth and high competition among retailers to deliver goods as fast as possible. That competition may increase drastically between retailers who sell online, meaning fulfillment centers may need to ramp up their automation in order to deliver goods faster. Customer expectations will continue to drive the need for quick delivery which may necessitate, and rapidize, the evolution of warehouse technology in the future.
Retailers have been searching for ways to enhance flexibility and adaptability in both inbound and outbound logistics.According to Adam Robinson, head of marketing for transport company Cerasis, automated packing and shipping will put warehousing at the very forefront of technology.In 2019, Amazon’s Robotics Fulfillment director Scott Anderson stated that the technology the company was using at the time was still largely limited, predicting that full automation was still at least ten years away. So far Amazon’s technology still requires a huge amount of human assistance.
An in-depth study of the U.S logistics industry by UC Berkely conducted last year found that technology uptake will be uneven across and within firms. For example, warehouse management systems are highly specialized and thus market penetration is difficult to predict.
Increased contactless payments
In an effort to speed up the checkout process and cut queues, retailers in the UK are encouraging the use of contactless payments. The World Health Organization has also announced that banknotes can pick up bacteria and viruses and should thus be avoided as wherever possible. With the world hyper-aware of disease transmission, we may see retailers implementing new payment methods that don’t require any contact whatsoever. Voice- and facial-recognition technologies, as well as self-checkout methods, will likely gain traction in the post-pandemic world.
A new attitude to digital communication
People all over the word are adapting to working from home; conference calls are becoming more common, meetings that are usually held in-person are taking place digitally and online communication is the norm. We at ShoppingFeeder have realized the challenges of remote work, but have also come to see its benefits. People like Bernard Marr of Forbes have envisioned taking these remote work practices into the future. Now that we’ve seen how feasible it is to conduct business online, rather than face-to-face, we may see a re-shaping of the business world and new business practices coming to the fore; and this means enhanced digital infrastructure.
Andrew Keen from Aljazeera also commented that our increased dependence on digital communication may offset the recent hostility towards companies like Facebook. Naturally, issues of privacy will still hold importance, however, video-conferencing app Zoom has already seen massive growth in light of the spread of covid-19. Keen predicts the effects of covid-19 will “fast-forward the fourth industrial revolution and digitalization of all services.”
A revised modern supply chain
The current pandemic has more than proved that we need more resilient global supply chains with disruptions such as export bans leading to shortages all over the world. The Institute for Supply Management in the U.S found that nearly 75 percent of companies in February reported at least one supply-chain disruption due to the coronavirus. Of these companies, 44 percent has no plan in place to deal with said disruption.
Companies will be looking to insulate themselves from disruptions like these in the future by identifying weaknesses and implementing new sourcing strategies and processes to counteract disruption- and this could mean a complete revision of the modern supply chain.
Many companies practice single-sourcing despite the risks involved, to meet cost targets or secure a supply. Now that operations in China have come to a screeching halt, even industry giants like Amazon are struggling to keep shelves stocked. As we pull ourselves out of this global crisis, companies will be looking to diversify where they get their products as China becomes a less pervasive part of the global supply chain.
In a connected global economy such as ours, the disruptions to international shipping and trade mean big trouble. Companies are unable to move products across provinces, let alone between countries and continents and every industry will need to adapt to the lessons we’re learning in this time.
Businesses may start to consider vertically integrating local supply chains to ensure that the components that make up their products are made locally.
After years of consistent product marketing across continents- where you can find the same pair of jeans in South Africa, America and China, for example- we may start to see market separation and hyper-localization.
A message from ShoppingFeeder
This is a time for solidarity; for identifying the opportunity borne of challenge and coming together as a global community to develop innovative solutions. We can achieve so much if we work together and think differently. ShoppingFeeder invites you to stay informed, stay indoors and to start to re-imagine the world of the future, with your business thriving in it.