With the continuation of rolling strikes impacting on Felixstowe until 5th October, we can’t help but think about all of our smaller eCommerce clients the awaiting for goods for that all important Christmas period. Since the beginning of the pandemic we’ve been faced with all sorts of supply chain challenges – not so much from a final mile perspective because the carriers we use have been exemplary in delivering over the last couple of years – but certainly in terms of stock to fill our warehouses. And ultimately, if you don’t sort out your supply chain before it gets into our warehouse you can end up with quite major problems. So how do eCommerce businesses mitigate the impact of strikes?
Strike impact on eCommerce businesses
Let us illustrate this for you. Our CEO, Kate Lester knows of at least two clients recently that have closed their business due to supply chain challenges. It has not been in the order fulfilment and final mile delivery, i.e. the bit that Diamond does. It has been wholly in delays from goods from the manufacturers that are predominantly many thousands of miles away i.e. China. From the Suez Canal crisis and the backlog that ensued to the recent strikes this is an issue that isn’t going away. Add to this ingredients that are in short supply (i.e. glass for glass bottles) mastering your supply chain is now the key to a successful online business, whether you are a book seller, a childrenswear company or an alcohol merchant.
How have our clients been mitigating the impact of strikes?
Well Ian from Sacred Spirits for example was very, very prudent and purchased a lot of glass bottles which was effectively hedging his supply of glass for a couple of years. This was a lot in terms of upfront investment and required storage but it has been shown to be VERY wise. We know of a lot of alcohol brands that didn’t do the same thing and consequently have been unable to launch or indeed have sold out because they are unable to provide their distiller with bottles.
We knew of a book subscription company that had all sorts of supply challenges from packaging (there is a cardboard shortage too!) to the supply of books and ultimately that led to the close of this business.
And very recently, we found one of our childrenswear clients made the mistake of selling goods on her website on on pre-order (i.e. weren’t actually in stock) and as a result had a lot of very angry customers to deal with when delays got worse and worse and worse.
How do eCommerce businesses mitigate the impact of strikes so that it doesn’t affect their trade?
1. Be more just in case rather than just in time
Think of your supply chain in terms of 12-24 months and not what it was previously which was 6 to 8 weeks. Just in time is dead. You must hold reasonable stock levels to compete. To be able to illustrate, we are sharing a recent example: one of our clothing retail clients was out of stock for nearly six months waiting for her new line to arrive. By the time her new line finally arrived, the audience that she built up for her previous products had all gone elsewhere. A salutary tale that the modern consumer has very short attention span. They want instantaneous fulfilment, have low loyalty and have plenty of other marketing thrust at them daily. If you can’t supply NOW, there’s plenty of other suppliers out there who can.
2. Do not pre sell goods
It is impossible to have control if a container takes months to unload or get stuck as result of strike action. What you are in control of is your customer experience. It is far better to have stock in your warehouse and be able to fulfil it instantaneously than for someone to buy and item and for it to take months to fulfil.
3. Control what you can control
What you can control is a really good warehouse and fulfilment company so that when your goods do get in you can fulfil them immediately. At Diamond, from goods in, to stock live can be 24 hours. And make sure that the fulfilment and warehouse company has a multitude of carriers so if there’s any supply chain issues with any of them you know you’ve got built in business contingency. And, make sure that that warehouse and fulfilment supplier has stock synced with all your online marketplaces so your clients can buy what is actually in stock.
4. Keep your clients really loyal
There are so many online shops nowadays it is very difficult to sustain ongoing brand loyalty unless you incentivise people with special offers communicate with people in order to tell them the latest updates in terms of your arriving new stock and ensure that you’ve got multiple product lines to market them with. A recipe for failure is relying on one client base, with one product to sustain your business revenues. Our best clients have multiple product lines and they repeatedly market their clients with them.
We hope these tips help. If you want to have a chat about seriously awesome and resilient fulfilment options once your goods have arrived in the UK you know who to call! Our team can be contacted on 0333 567 5888. Alternatively, email us at email@example.com or complete our contact form below.