The Impact of Digitization on Canadian Retail Logistics

Mass Retail Industry October 18, 2021

With the emergence of e-commerce prior to COVID-19, there was already a rapid shift occurring in retail logistics. The amount of consumers purchasing online grew and so too did delivery expectations. This shift was then quickly amplified as a result of the global pandemic. The pandemic is said to have accelerated the growth of e-commerce by at least two years due to consumers making the majority of their purchases online from home. 

A shift towards e-commerce is also followed by many customer behavioural changes and expectations impacting retail logistics. 

Online availability 

Customers have an expectation that products are no longer only available to be purchased through brick and mortar and that the same level of products are accessible online. Online sales were projected to have risen from approximately 11.9% of global sales to 17.5% by the end of 2021, indicating that if you have a discrepancy in what you offer online versus in person, it can result in lower profitability. 

Fast and free to low-cost delivery 

Free and quick delivery has become another rising expectation from consumers. In fact, a survey of shoppers uncovered that 50% of customers will abandon their shopping cart if this need is not met. As a result of Amazon’s same-day/one-day delivery setting precedent on fast deliveries, it has become critical for businesses to compete for a faster delivery service. 

Easy returns 

In addition to receiving the parcels at their front door, customers have a growing expectation to be able to return any products easily. Reverse logistics need to be just as efficient and prioritized when offering fulfillment services. 

Technological changes

It’s no secret that retail logistics have to shift to stay parallel with consumer expectations. The primary shift in retail logistics as a result of online shopping is arguably the technological integrations that are essential to meet consumer demands. Real-time visibility is an important adoption in supply chain management to not only track orders for the logistics team, but to also allow consumers to clearly track where their purchases are at all times. 

Real-time visibility can be implemented in every segment of the supply chain, from the supplier, to entering the warehouse, and during its delivery track. More than 55% of retailers claim that order tracking at all touchpoints has improved customer satisfaction. 

Real-time visibility also helps the logistics team identify any vulnerabilities in the supply chain. Allowing them to alter these vulnerabilities where possible and create a more efficient supply chain to achieve faster fulfillments. 

Personalization and consistency 

Another retail logistics change is carrying on the consistency of personalization and branding found in brick and mortar stores across deliveries as well. Customer-satisfaction rates can increase as much as 20% with a 10-15% increase in sales-conversion rates. Personalization is commonly found within the packaging and kitting part of the logistics process. 

Optimizing your stock and forecasting accuracy 

Although forecasting accuracy was just as critical prior to the pandemic, its importance spiked as a result of consumer behaviours. As was evident in the beginning of the pandemic and a few times throughout, some stock became sold out as a result of a sudden spike in demand. 

Ensuring that your supply chain management reflects the demands of your consumer demands and, as mentioned above, integrating the right technologies to help forecast and optimize your inventory levels are important in terms of the growing use of e-commerce. 

Check out McKenna Logistics’ inventory management services. 

McKenna Logistics can help your retail logistics shift for greater success 

With the growing usage of e-commerce and a rising expectation in new consumer demands, it can get overwhelming to adjust accordingly. With the new changes in retail logistics, it is important to get on board and ensure your business is coordinated with emerging trends. 

Outsourcing your logistics to a third-party logistics provider, such as McKenna, will ensure you are staying up-to-date with new changes and integrations in the industry. 

McKenna Logistics offers customized logistics and shipping solutions, optimizing your efficiency and saving your business money. Check out McKenna’s approach to logistics. 

Call us at 1-800-561-4997 or send an email to sales@mckennalogistics.com to get started today!