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The fallout from the COVID-19 pandemic has demonstrated how fragile the traditional high street retail model actually is. And with the ongoing effects of Brexit, business agility across numerous industries has been extremely tested, with those unable to manage the changing conditions being forced to close.
Agile business in a time of rapid change
Read the latest report published by Transalis, exploring the challenges currently faced by businesses across industries and how manageable digital transformation is helping to mitigate them
This blog explores how businesses successfully navigated through this period and how they continue to pivot to survive.
Winners and losers
Over the last few years, we have witnessed the challenges faced by many businesses and their responses, however effective or ineffective, to combat them.
There have been both winners and losers in this process:
Winners proved that pivoting to D2C and maintaining business agility paid dividends
Losers realised that hesitation or lack of response to changing business conditions would cost them and make it difficult to fully recover to pre-pandemic levels
Inaction proved extremely costly for high-street favourite Primark, who did not adjust their business model throughout the pandemic. According to the Retail Gazette, the clothing retailer reported a loss of £1.5 billion during the COVID-19 lockdowns. Further reports detail how like-for-like sales are below pre-pandemic levels, dropping by >10%.* Job losses have also been announced, with 400 store managers to be cut across the Primark network.* Despite this, Primark is yet to invest in an ecommerce channel, instead opting to update its website to include a wider range of product information and in-store stock levels.**
Whereas, for John Lewis, the pandemic presented an opportunity to invest further in their ecommerce offering. As reported by Charged Retail, the department store giant has channelled £1 billion into its online business, after witnessing a 70% increase in online shopping activity. Almost three-quarters (74%) of John Lewis sales for the first half of the 2021 financial year were online, with a 12% increase in sales overall.*** This sparked an £800 million investment in digital-led transformation over the course of 2021.*** The investment includes the increase of online distribution capacity, with new warehouses opening in Bardon and Milton Keynes.
Pivoting to D2C
As with the example set above by John Lewis, many other manufacturers, producers and wholesalers have pivoted their business model from bricks-and-mortar stores to Direct To Consumer (D2C) over the last few years.
Although this is a direct result of the pandemic, consumer demand for online shopping and home deliveries has been on the rise for some time. Evidently, with high streets closed for lengthy periods this growth in D2C has just accelerated.
Unsurprisingly, businesses that already had a reliable and structured D2C channel in place prior to the pandemic were at an advantage. They were able to maintain business agility and divert budget away from the high-street and into improving their existing online offering. On the other hand, businesses that did not typically have the infrastructure to manage an online channel alongside their bricks-and-mortar stores needed to pivot to survive. E-commerce platforms offered the immediate fix to meet the D2C requirement.
However, as this economic situation has continued (subsequent national lockdowns, store closures, and restrictions on movement) the Plug and Play (PNP) e-commerce platforms used by many businesses that pivoted to D2C only provided a temporary ‘fix’. Many have realised that a more robust solution to an omnichannel business provision is needed in order to scale in line with the increased complexity of the supply chain.
Business agility in practice
Our client, simplehuman, was able to resolve the scalability issue by using Transalis eDI™ software to connect their e-commerce platform with their full supply chain.
By integrating their EDI solution with their e-commerce platform, they were able to automate a number of processes. This automation subsequently enabled the business to run a 24/7 operation rather than one that was confined within office hours.
Transalis eDI™ has been the backbone to facilitate a fully automated range of e-commerce data processes, including; order acknowledgement, despatch advice, invoicing and inventory for both our wholesale and DSV (Drop Ship Vendor) relationships. simplehuman now has a robust system of validation in place, which manages partner pricing and carton quantities efficiently whilst also avoiding any risk of order duplication.
EDI for business agility
Our transparently priced bundled solutions allow you to select the exact software solution that is right for your business, with the right number of connections, integrations, and message types.
With Transalis eDI™ our clients are able to automate business processes that were typically time consuming and costly, as well as gain increased insight with greater data visibility across business systems. An efficient EDI solution allows for increased business agility and better business decisioning, with the rapid onboarding of your trading network.
eDI Software
eDI Freedom
Build your own bespoke EDI solution according to your supply chain & integration needs
eDI Connect
Ideal for companies with many trading network, high order volumes, requiring enhanced stock & sales reporting
eDI Connect+
Perfect for larger organisations requiring complete visibility across their supply chain to improve efficiencies
To discover more about business agility, download your copy of our latest report: Agile business in a time of rapid change. You can also discuss your business requirements for a robust and scalable EDI solution with our dedicated team: call us on 0845 123 3746 (calling from UK) or +44 1978 369 343 (for international callers), or contact us via email sales@transalis.com
References:
* Primark to cut 400 store management jobs. BBC News
** Primark finally shares date for new website launch. Mirror
*** John Lewis invests in customer experience and delivery capacity. Internet Retailing