The ancient Chinese curse “May you live in interesting times” has never been more apposite. In the UK, Brexit – and the uncertainty around how that may play out – dominates the news. Internationally, the Trump administration’s declaration of trade wars – along with late night tweets interfering in, among other trade matters, Brexit – are destabilising. The fear of extreme weather as climate change starts to bite, changes in shopping habits and the growing influence of technology on consumer behaviour added to retailer anxiety. Interesting times, indeed.
The common thread running through these issues can, however, be boiled down to a single challenge: how to mitigate against uncertainty. While by its very nature uncertainty is uncertain, there are steps that retailers, brands and wholesalers can take to help protect themselves against these vagaries – there may be a dearth of advice from the government, so here are some things to consider.
The biggest single issue facing all UK – and to some extent European – businesses is Brexit. Not so much what it means, but what might yet happen. There are essentially three outcomes: the UK crashes out with no deal and reverts to World Trade Organisations (WTO) rules; the UK leaves with the deal on the table – or some sort of compromise based around that; or, somehow, the UK doesn’t leave at all.
These three likely outcomes all have very different effects on business, which means planning is, of course, a bit of a nightmare. Also, come 11th December and the Commons vote on the Brexit deal, things may be clearer. Assuming not, what can you do?
For food, fashion and luxury item retailers, the main worry whatever the Brexit outcome is in supply. They are also worried about fluctuations in currency values, as this too impacts costs of supplies, as well as potentially eating into profits.
According to a study by interest group The UK in a Changing Europe, Burberry is seeking Authorised Economic Operator (AEO) status, which would reduce the physical checks of its goods and simplify customs procedures, to minimise any potential difficulties.
M&S, meanwhile, is worried more about lack of suitable labour and is recruiting as a result.
There is also the potential impact in changing regulations as we leave the current status quo of EU rules on our goods and start to trade with Europe under either WTO rules under a no deal Brexit, or under revised EU rules under any other kind of EU exit deal. This can’t yet be truly planned for as no one knows what we will be facing, however, it is already having an impact.
Large retailers are already working hard – and at great expense – to ‘war game’ outcomes. For smaller retailers, which make up the vast majority of the retail ecosystem, there isn’t the money nor staff (nor time!) to do this.
This leaves smaller retailers facing Brexit with perhaps even more uncertainty. Key things to consider are to look at supply chains and how they may be impacted and try and plan for that. Shipping is going to be key part of this and having the right deals in place with a variety of carriers is going to be key, not least to cover what may yet happen. With so much up in the air at the time of writing, covering all bases is probably your best bet.
The main thing with eCommerce is to keep the customer up to date about what is happening. Make sure that your website outlines, nearer to the 29th March 2019 Brexit date, what is likely to happen. Let your customers know that you don’t know what is going to happen – then at least they know that, like them, you don’t know what is happening either.
Usually at this time of the year, we would all be more concerned with ‘leaves on the line’ and other disruptions caused by the weather. While Brexit has kept this from the headlines, adverse weather is still a big issue for eCommerce.
While rail is impacted by leaves on the line, the wrong kind of snow and rails buckling in the heat, delivery is always going to be at the mercy of the elements. While bad weather can increase the sales of umbrellas and hot weather drive more deliveries of barbeques, getting the goods where they need to be is always going to be hard.
As winter starts to bite, adverse weather thoughts turn to snow. Snow, while deep and crisp and even, is a nightmare for business. First off, it stops your staff getting to work, with obvious consequences. For eCommerce businesses it also stops stock coming in and orders going out – often at a time when it actually drives up online sales as people buy online rather than going out to the shops.
Unlike Brexit, we do have weather forecasts, so the first step in mitigating the impact of weather on your business and to helping keep your customers happy is to watch the skies. It’s winter, snow may come, be prepared: stockpile goods in the run up to bad weather and line up a variety of carriers to help handle what may become a backlog of deliveries – this way, while lack of staff and blocked roads may stop you delivering immediately, it leaves you ready for when the world starts to thaw out.
It is also vital to have accurate information on your website about the impact the weather will have on delivery. Turn off same day or next day delivery options and clearly state that ‘due to the inclement weather, deliveries may be delayed’. Keeping people informed is key.
As with Brexit, letting customers know that things are in flux and not running as normal is half the battle. You may not know when the roads will re-open, but you can assure them that they will get their goods soon thereafter when they do.
Allowing shoppers to track where their goods are is also vital. With the same idea in mind, letting them know that it is still stuck in the warehouse because of the weather works wonders. They don’t mind it being late so long as they know it is late and that you know that it’s late.
Again, having a variety of carriers in place will help get those deliveries through. It will also help clear that backlog post-thaw, as you have more options available to you. It is also worth noting that managing this variety of carriers can also help you deliver as much as possible before the weather bites, assuring that business and delivery is disrupted as little as possible.
Changing consumer habits
Brexit, like the weather, will come and go, however how consumers shop has changed markedly and forever over the past couple of years – and is set to change even more in the years ahead, driven by technology changes.
For High Street shops this has been a bit of a problem. For eCommerce it has seen more people turn to online shopping from PCs and mobile devices, which in turn has shifted many retailers from in-store stock and promotions to having a very different set up, pivoting around websites, apps and delivery firms.
The rise of eCommerce has been long and hasn’t really taken anyone by surprise. Most retailers who choose to sell online have the basics at the very least in place. But how mobile and voice are being used is rapidly shifting retail – and it too presents a range of challenges for retailers.
This peak season has already seen 56% of fashion sales being undertaken on mobile, while Adobe Analytics shows that 55% of Black Friday retail sales came from mobile. More striking still is that retail app hosting company Poq found that shoppers spent the equivalent of 21 years and 7 months using retail apps on Black Friday alone.
This shift has a huge impact on retailers. For starters, they have to make sure that their website is mobile optimised. Gone are the days when shoppers will happily struggle through a poor HTML experience on a phone just for the sake of convenience: they expect it to work, be slick and fast.
They also expect apps to be up to date and work as well as your mobile-optimised website.
One answer is to look at Progressive Web Apps (PWAs); mobile websites that act like apps, but with the advantages of the web – rapid updates, adaptability to a variety of devices, including PCs and so on.
The other area of rapid change for retailers and brands is that of social media and marketplaces taking a greater slice of the eCommerce pie. 44% of shoppers now head straight to Amazon – often on mobile too – and, with shoppers lurking here, brands and retailers are having to follow suit.
Similarly, increasing amounts of retail traffic and sales are coming through social media sites, particularly Instagram, Facebook and Pinterest. In fact, these sites are becoming quasi-marketplaces and, if anyone is going to rival Amazon and eBay’s hegemony over eCommerce, it is going to be mobile social media.
What this means for retailers is that they have to be channel ready. They have to have the processes in place to handle orders that are coming from across many different platforms and they have to work with these third parties in particular to manage their delivery.
Selling through Amazon, for example, can be a bonus in that you can use Amazon to fulfil these sales. This can then be worked into your multi-carrier strategy – so long as you seek to manage it properly.
To paraphrase Bob Dylan ahead of his headlining in Hyde Park next summer, the times they are a-changing for retailers. Brexit offers so many uncertainties right now that planning to mitigate its impact involves trying, right now, to cover all bases. Hopefully what the industry is actually facing will become clearer later in December, and you can plan accordingly.
Similarly, without sounding too Game of Thrones, winter is coming, and there will be disruption – you need to be prepared.
And the changing shape of how shoppers shop all year round is also changing how you run an eCommerce business. Shoppers want speed and convenience – and that means they want sites that work and they want their goods to arrive ASAP.
All this can be aided by looking at how you operate and run a multi-carrier delivery strategy. In terms of Brexit, it will allow for the flexibility to be ready for the unknown. From a weather point of view, it means that you can fulfil before the weather turns, handle post-thaw backlogs and have the data at your fingertips to help customers track where their weather-bound items are and for, you the retailer, to keep your consumers informed about how weather is impacting delivery.
In the face of changing shopping habits, multi-carrier delivery and its correct management are perhaps most crucial. It allows you to offer the full range of delivery options – from same day to cheap and lengthy – as well as helping to fulfil on orders that are increasingly going to come from a wide variety of sources outside just your own website.
For eCommerce, we are embroiled in interesting times, but managed correctly it may not be so much of a curse as its now-obscure Chinese author meant it to be.
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Parcelhub is a bespoke and proactive multi-carrier delivery management solution. Flexible and scalable, it integrates seamlessly with marketplaces, eCommerce platforms and order management systems, providing hundreds of multi-channel retailers, global brands and wholesalers with one access point to 20+ carriers and 600+ services.
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Parcelhub is part of the Whistl Group. Whistl is the leading delivery management company enabling customers to get their letters, leaflets or parcels to customers efficiently and cost effectively both in the UK and internationally. It is headquartered in Marlow with 8 depots and 2 fulfilment centres across the UK handling 3.8bn items a year. The company is privately held with over 1,500 employees and a turnover in excess of £600m. It has grown significantly over the years and is now expanding its presence in the eCommerce sector offering fulfilment services to customers through a seamless experience from first click to final delivery.