Complexity of e-commerce supply chain raises the stakes for manufacturers

With 131,447 U.S. businesses selling their products online, revenues near $298 billion and an annual growth rate close to 6%, the e-commerce supply chain’s growing volume is complemented by increased complexity.

These are among the findings of the “E-Commerce Market Assessment” published this year by PMMI, The Association for Packaging and Processing Technologies, the owner and producer of the Pack Expo portfolio of trade shows.

With jumps in volume and complexity, however, come challenges manufacturers must address. PMMI also produced an infographic highlighting the study’s key findings, now available at packexpolasvegas.com.

Keep the product safe
Replacing a destroyed item can cost up to 17 times as much as shipping, and overcoming negative online reviews stemming from such an incident can take months. Each step in the delivery chain only increases the risk of damage to packages and that makes engineering essential. Ultimately, manufacturers must ensure packaging remains undamaged throughout the delivery process, regardless of the shipping scenario. Another, related challenge is eased with the effective use of warehouse management systems, which help make rightsizing feasible.

Constant communications count
Strong communication with third-party retailers is another critical factor for manufacturers overcoming the complications of the e-commerce supply chain. Frequent communication can bridge disconnects that lead to consumer dissatisfaction. For example, when brand owners plan significant changes to primary packaging, they should work with their third-party retailers to take current inventory and marketing into account so the consumer experience is in sync with the marketing.

Secondary packaging is prime marketing space
Product marketing on packages presents another challenge: Distinct differences of opinion. Marketers want packaging to reflect their brand and even advertise products; operations and engineering question the value of branded packaging post-purchase; and logistics professionals face looming concerns of theft. These disagreements can present significant hurdles, but compromises can be found through tactics such as discreet branding and product advertisements on secondary packaging.

For solutions to these challenges, Pack Expo Las Vegas and Pharma Expo 2015 will be held September 28–30, 2015 at the Las Vegas Convention Center. The shows’ first co-location in Las Vegas is expected to draw 30,000 attendees and 2,000 exhibitors across more than 800,000 net square feet of exhibit space.