Supply Chain Performance

Navigating the omnichannel supply chain: five must-know takeaways from our report

In an era where consumers navigate across multiple sales channels, companies must implement an omnichannel supply chain strategy.

On March 29, 2024

Players that fail to shape their supply chain accordingly will struggle to remain competitive. FM Logistic surveyed companies* across the Consumer goods, Retail, and Beauty & Luxury sectors to understand where companies stand in their omnichannel supply chain journey. Here are the pivotal insights you need to remember.

#1 – Traditional sales dominate, but e-commerce is booming

While physical stores remain the primary revenue channel, the surge in e-commerce sales is a reality. This shift started during the pandemic and has continued to gather momentum, establishing online shopping as an integral part of consumers’ shopping habits. Multiple pick-up and delivery options, rising internet and increasing number of smartphone users further drive e-commerce growth.

87 % of companies have stated a rise in their e-commerce sales since the pandemic.

#2 – Fully integrated omnichannel supply chain is the future

We can expect the trend towards fully integrated supply chain to continue as companies embrace digital technologies, prioritise customer-centric approaches and seek operational efficiencies to stay competitive. An integrated supply chain, combining B2B and B2C distribution, can lead to enhanced operational efficiency, cost savings, optimised inventory management, increased agility and much more.

56 % of companies surveyed have fully integrated omnichannel supply chain for both e-commerce and offline sales

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#3 – High cost and shortage of stock drive omnichannel supply chain adoption

The shift to an omnichannel supply chain is mainly driven by retailers’ commitment to reduce logistics costs and operational expenses by eliminating silos in the distribution process. Shortage of stock / out-of-stock instances is another reason for this transformation.

46 % of companies have stated that high logistics costs have influenced their decision to adopt an omnichannel supply chain

#4 – Hiring and training talent are the top challenges

Retailers are likely to encounter complex issues when embarking on a journey of supply chain transformation. Hiring and training their workforce has been identified as the main one due to the variety of skills required. Mastering data management, streamlining order fulfilment processes and seamlessly integrating technology are other key challenges to be tackled.

49 % of companies consider hiring and training the required workforce as a challenge to implement omnichannel logistics

#5 – Most retailers seek 3PL help for omnichannel implementation

While companies are likely to transition to an omnichannel supply chain in less than two years, they will likely engage external 3PL service providers. They need partners supporting them in IT integration, flawless operational execution and seamless data synchronisation. Companies expect 3PL partners to help them enhance the speed and accuracy of deliveries, rationalise IT systems, and ultimately improve customer experience across all channels.

66 % of retailers have stated that they seek external support when implementing an omnichannel supply chain

* FM Logistic surveyed 105 respondents across three sectors – Consumer goods (36), Retail (49), Beauty & Luxury (20) – based in India (37), France (36) and Poland (32).