Today’s brands are enjoying a once-in-a-century gold rush predominantly sparked by rapid digital growth and a discernible willingness on the part of consumers to take their shopping experiences, even those once thought to be sacred to brick-and-mortar retail, into an e-commerce environment. Add to that a seemingly endless number of sales and distribution channels — retail, marketplaces, social commerce platforms, a booming drop-shipping industry — and the deck certainly feels heavily stacked in the favor of brands of all sizes.
The numbers tell the story: Online retail sales are projected to reach $6.51 trillion in 2023. However, a gold rush is only as good as the picks, shovels and pans with which to mine. And many brands, unfortunately, find themselves in the middle of a boom cycle without many of the tools needed to capitalize.
It’s a classic “too much of a good thing” problem. Ubiquitous sales channels, yet not enough resources to realize the true potential of them all. Or put another way: Gold everywhere with no pails to carry it.
Inventory, product taxonomy, order management, invoicing, fulfillment, and data can be nearly impossible to manage across hundreds if not thousands of channels — at least without the proper tech stack and systems set up. Here’s how to do it.
Adopt a Centralized Inventory System
Keeping track of inventory is one of the most difficult aspects of maintaining a distribution strategy in a fragmented e-commerce environment. Adopting a centralized inventory management system can help brands maintain a real-time picture of stock levels across all channels — even if there are hundreds of them. Avoiding stockouts, reducing overstocking, and optimizing fulfillment procedures allows for maximum efficiency … and maximum return. A unified inventory management system will automate and organize SKUs, track sales trends, and assist leaders in making data-driven distribution decisions.
Seek Automation
Automation is key in an environment where sales of just a single SKU could be coming from dozens of different channels. Software that’s able to automatically handle taxonomy, mapping, pricing, and more saves hundreds of manual hours working one-on-one with every single one of your merchants. Case in point: Inefficiency costs brands 20 percent to 30 percent of revenue per year, according to multiple industry studies.
Give Drop-Shippers a Leg Up
The biggest brands have thousands of drop-shippers, so if giving each and every one of them undivided attention seems far-fetched that’s because, well, it is. However, it doesn’t need to feel that way — at least not to them. Streamlining order processing, fulfillment, and tracking orders utilizing the latest technologies makes a drop-shipper’s life a lot easier. Give them the tools they need to succeed. The more efficiently you can service your drop-shippers, the more fruitful the relationship for both parties.
Take Work Off Your Partners’ Plates
Selling through retail partners is an important aspect of many brands’ distribution strategy. However, a brand that manually integrates with a retail partner is knowingly or unknowingly creating hundreds of hours worth of work for that partner’s e-commerce and tech teams. A larger brand with hundreds of product listings integrating with a smaller retail channel partner might easily overwhelm the team, not to mention budgets. That’s a bad start to any relationship.
Instead, come prepared with auto-adjusted product images according to the retailer’s specifications; standardize all product data in multiple languages to fit retailer requirements; make available pricing in multiple currencies; and provide real-time inventory updates based on each retailer’s specific formats and frequencies.
For brands and channel partners, the highly fragmented e-commerce market brings both obstacles and opportunity. Strategizing around automation to maximize efficiency and scale might provide a competitive advantage. It also might just provide the picks and shovels necessary to capitalize on this gold rush.
Roy Avidor is the CEO and co-founder of Cymbio, a marketplace and dropship automation platform.
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