Dive Brief:

• According to a new report from DHL Supply Chain, out of 900 logistics and supply chain decision makers surveyed, 60% said their organizations had yet to fully implement an e-commerce strategy despite recognizing its business value.
• The majority of B2B and B2C enterprises represented in the survey said they were falling behind on implementation due to constantly shifting consumer expectations, limited resources and other urgent business priorities.
• "E-commerce is a primary driver of business growth," Jim Gehr, president of retail at DHL Supply Chain North America said in a press release. "Companies know they can no longer afford to operate without a comprehensive omni-channel strategy that develops a deep personal relationship with each individual customer, but many are at a loss for how to continue to keep up with customer demands." 

Dive Insight:

The challenges facing B2B and B2C companies across industries are highly similar, Gehr told Supply Chain Dive in an interview. Both are grappling with the fact that traditional supply chain expertise doesn't translate perfectly into the constantly evolving, and increasingly complex, e-commerce landscape. This makes it difficult to develop and implement a comprehensive strategy that keeps pace with market dynamics.

"Just because you've done supply chain in the past doesn't mean that you're qualified to do e-commerce going forward without going through all of the lengthy and expensive learning curves," Gehr said. "So your options are 'Do I want to go through all the pain and the cost of making less than best-in-class choices? Or do I want to align myself with [a third party provider] who has 20 years of experience in doing this?'"

The number one challenge survey respondents cited when implementing an e-commerce strategy was changing customer expectations. A primary driver of this is the push for two-, one- and same-day delivery and the back-end infrastructure required to make that feasible.

Gehr said companies are dealing with significant disruptions in warehousing, fulfillment and shipping because the lead time between massive orders has dropped with e-commerce. As a result, to fulfill customer delivery expectations, orders can go out by the case as opposed to by the truckload. This makes it difficult to achieve perfect orders cost effectively as companies opt to prioritize trucks going out faster as opposed to only when they're full. 

"The need for accurate information about product availability, shipping and inventory counts will become the single-most strategic element for driving bottom-line success and establishing customer loyalty," a survey responded said in the report.

To achieve this, companies have to take a holistic approach to e-commerce instead of looking at the supply chain function in isolation. E-commerce involves company-wide alignment on strategy, from social media marketing to inventory management and warehousing, which is why so many companies are still figuring out what strategy works best for them, Gehr said.

For the majority of companies still working through these challenges, Gehr emphasized the importance of allying with firms in the industry that do e-commerce well, such as outsourcing to a third party. While it doesn't get firms off the hook for developing a strategy, it can save them the headache or lost opportunities that come with trying to develop such a complicated function from the ground up.