Omnichannel in Manufacturing

The smart retailer knows the value of omnichannel options for consumers. While online platforms have significantly improved the customer shopping experience, retailers and others within the supply chain are having difficulty keeping up with demand. Manufacturers specifically are having challenges with fulfillment due to rising costs in materials, employee wages, and other non-controllable factors. In the end, to compete in today’s market, manufacturers must find ways of keeping up with consumer demand – or others will replace them.

Let’s review some of the common challenges facing manufacturers with omnichannel consumer marketing options, and how they can meet these issues head-on.

The Main Problem – Product Fulfillment

Today’s consumer and retailer expects the timely fulfillment of merchandise. Whether it’s an order placed on a retailer e-commerce site, or brick and mortar location, nobody likes to hear the phrase out-of-stock. Manufacturers face many challenges that cause difficult keeping up with consumer demand including:

• Difficulty securing raw materials: Whether it’s due to increased tariffs, higher shipping costs, or fewer raw materials used to manufacture consumer goods, it has become increasingly difficult for manufacturers to secure the materials they need.
• Using antiquated manufacturing equipment and techniques: As orders increase, many manufacturers are having difficulty increasing production. A major reason for this is due to manufacturers using older equipment or processes that are not as efficient.
• Employee turnover: While unemployment is much lower than in recent years, there has been a steady issue with turnover in manufacturing. In some instances, workers are finding better-paying jobs. Regardless of the reason – manufacturers spend a lot of time training and hiring new employees. This reduces manufacturing productivity, which in the end – impacts fulfillment.

While many of these items are not controllable, there are a few ways that manufacturers can improve their operations to comply with changes in omnichannel marketing in the retail world.

Improving Manufacturing Best Practices

The retail omnichannel touches many chains including retailers, resellers, warehouses, distribution centers, and eventually the consumer. To evolve, changes in manufacturing best practices must be made. There are several individual aspects of product fulfillment beyond the manufacturing of goods that should be improved including:

• Embrace drop-shipping: While LTL and FTL carriers are dependable, many omnichannel options have embraced the concept of drop-shipping. This permits retailers to skip the middleman to get their products directly to consumers.
• Ensure all shipping options are available to consumers: Consumers want their products shipped to them through multiple platforms including parcels, full truckloads, LTL, overnight, or in some cases, white glove service. Manufacturers need to work with retailers to ensure all shipment options are on the table to deliver their products to the end user.
• Improve Communication with Partners: Several manufacturers have exceptional relationships with retail partners. The key to growing success is improving communication across multiple channels. Smart manufacturers know the value of evolving with the times and communicating with suppliers, shippers, employees, and others within the supply chain.

The Benefits of Improving Manufacturing for Omnichannel Retail Partners

The retail world has changed significantly in recent years. While manufacturers used to have a simple job of making consumables and shipping to a retailer, the evolution of omnichannel retailer marketing options have caused manufacturers to evolve or be left behind. When they invest in making changes, there are multiple benefits including:

• Open opportunities for B2B growth. With the expansion of retail opportunities, many retailers and manufacturers have created business to business partnerships. Whether it’s increasing drop-shipping platforms, or creating new partnerships with suppliers, manufacturers who evolve are more attractive to outside partners. The ultimate benefit is increased business opportunities and higher profit margins for retailers.
• Better Relationships with Partners: As the saying goes, birds of a feather – flock together. When it comes to embracing omnichannel marketing and retail strategies, manufacturers who join the party develop stronger relationships with like-minded partners.

There used to be a time, not so long ago when marketing to consumers was a simple proposition. A brand would advertise, consumers would travel to their brick and mortar location and purchase their goods. With the invention of mobile devices and the expansion of the internet, the evolution from multi-channel to omnichannel retail marketing has become a reality.

Whether it’s social media growth, online marketing, or the introduction of drop-shipping retail options, opportunities for consumer conversion are expanding, which drives today’s retail market. While it used to be marketing buzz-term, omnichannel marketing has now become mainstream and a way of life for any brand or retailer. Manufacturers that evolve to the changes in technology and retail marketing are ones who will succeed. Those who refuse to change will be left behind.