COVID-19 exposes pain points across e-commerce supply chains
The industry was already moving away from bricks and mortar, led by the likes of Amazon, eBay and, increasingly, Walmart. The expert anticipated a continued trend in that direction, with customers also now “extremely sensitive” to product safety and disease transmission through package delivery and fulfilment. At the same time, customers are demanding faster, better quality and cheaper delivery.
“It’s difficult because so many of these companies, their revenues are down, so how do you invest in that kind of thing when your revenues are down?,” the specialist said. Key areas of focus should be capacity, fulfilment network, topology, technology, and the health, wellness and safety of employees.
Another topic covered in-depth was how Amazon’s fulfilment partners could be affected as Amazon Fulfillment scales up, and how the company’s relationships with UPS and FedEx might evolve as the offering grows.
In the Interview the specialist also acknowledged that Amazon is causing the bulk of disruption across the fulfillment landscape, and there’s opportunity for further disruption. “Being the 900-pound gorilla on the block they get to dictate a lot of where the industry is moving because there’s such a massive ecosystem stitched to the Amazon fulfilment network,” the expert said.
Other areas explored were potential surcharges as a result of COVID-19, the outlook for Amazon’s relationships with UPS and FedEx, and fulfillment and final mile costs for Amazon compared with UPS and FedEx.
The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
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