How E-Commerce Merchants Can Adapt And Thrive During Supply Chain Interruptions

Leading up to the holidays, $24 billion worth of goods waited in the waters outside of California ports. In October 2021, President Biden declared that he’d get U.S. ports running 24 hours a day, seven days a week, in an effort to unclog the supply chain and ease worries about holiday delays. Since the start of the pandemic, about one-third of shoppers have experienced substantial shipping delays. But it turns out that a pandemic and clogged ports are just the tip of the supply chain problem iceberg.

With the surge in online shopping, there’s unprecedented demand for goods and home delivery. Shortages exist throughout every aspect of the supply and delivery chain. We’re running low on raw materials, which is driving costs up. There are diminished (or no) delivery guarantees from the United States Postal Service (USPS). And a tight labor market, including shortages of truck drivers and store and warehouse workers, has created a perfect storm of fulfillment problems for the holiday season.

Many merchants might feel helpless and believe that much of the supply chain problem is out of their hands. Merchants are already warning their customers in a flood of emails that they should shop for the holidays early due to current conditions. But the problem isn’t going away anytime soon. It’s not contained just to the 2021 holiday season or the latest phase of the pandemic.

Consumers love — and now demand — frictionless fulfillment, including fast shipping and easy returns, regardless of the conditions plaguing your business. And there are always forces plaguing your business to increase friction and decrease customer satisfaction.

But today’s challenges present an opportunity for merchants to double down on what they can control. It’s a chance to rethink and overhaul warehousing, shipping options, demand forecasting, customer communications and merchandising strategies to meet the rising consumer need for immediate satisfaction. Here’s a look at where to start.

Make the entire fulfillment chain transparent 

Vague warnings like “may not arrive on time” (the classic “I told you so”) only frustrate consumers. Provide transparent communications across the entire fulfillment chain, from availability to delivery. It’s far better for customers to know instantly if something’s on backorder, rather than to purchase it, get frustrated and initiate a refund. In fashion, it’s also critical to only promote products that you have available in nearly all (80% or more) sizes. Also known as a “full-size run,” this ensures your valuable advertising dollars aren’t inadvertently creating customer satisfaction headaches.

Get ahead with pre-orders

Many merchants successfully promote pre-orders of coming products or collections, communicating upfront that although they’re not available yet, there’s an expected delivery date and the consumer will be among the first to get the goods. Pre-orders are a great marketing and merchandising tactic to help you predict how much inventory you’ll need, understand demand and feed directly into the buyer psychology of immediate satisfaction and being the first to have a new product.

Provide incentives for shoppers who aren’t in a rush

Part of the new need for transparency is understanding the time needs of the shopper and reacting accordingly. For those who aren’t in a rush, or who could be persuaded to wait, you can provide incentives for longer ship dates or wider delivery windows. For example, Amazon routinely offers slower shipping in exchange for coupons and credits to its digital Prime offerings — a business it’s trying to aggressively grow. This essentially gives them the ability to use slower, cheaper shipping and incur only a nominal expense for promoting new digital offerings. Smaller merchants can mimic this by declaring, “If you’re not in a hurry, we’ll ship by this date and give you a coupon for your next order.”

Filter by inventory and location

Direct customers to products they can get quickly. Location-based filtering can ensure that only goods that are available and in a nearby warehouse or store are offered first during site searches or promotions. With modern geotagging and inventory tracking solutions, merchants can now more easily understand what’s available where and be sure to present those goods front and center during shopping experiences (especially if time is of the essence).

As holidays or events (like birthdays) approach, be aggressive in promoting nearby items for immediate delivery or pickup. Pickup at a local retail store delivers two terrific advantages: It’s the cheapest shipping option for the merchant and is potentially the fastest way to put orders in the hands of customers if available the same day.

Automate, automate, automate

E-commerce can incorporate an array of artificial intelligence and optimized shopping platform technologies to automate many tasks. Once only available to the largest retailers with hefty tech teams, many of this off-the-shelf software-as-a-service (SaaS) solutions can do many tasks faster and more accurately than humans. They can free up your staff to focus on more valuable tasks, like aggressive supply chain management or more personalized and responsive support.

Provide great ongoing customer support

In most businesses, support is typically the last avenue that can deliver satisfaction. A great support experience can really turn a bad transaction around. But it’s time to stop thinking about support as an afterthought, deployed only when something goes wrong. What if support was delivered along the way? For example, new technologies can easily match shopping patterns and searches to serve up collections that might be of interest, in stock and available for immediate shipping.

Each of these business and technical strategies on their own can help relieve product delivery and customer speed and satisfaction pressures. But think beyond the quick fix. Table stakes in modern e-commerce require frictionless, fast-as-possible experiences, and you’ll need to combine these and more strategies on an ongoing basis to stay competitive.