Supply Chain Resilience in a Post-Pandemic World

The COVID-19 pandemic made us all aware of the extreme vulnerabilities in the supply chains all across the globe. The challenge was truly unprecedented. The disruptions ranged from being present in the manufacturing processes to delays being experienced in transportation. And hence in the post-pandemic era, building resilient supply chains is now more than ever imperative.

By Supply chain resilience, we refer to the ability of a system to anticipate, prepare for, respond to, and recover from disruptions. This is now not an option which should be looked into but a necessity at all costs.

Through this article we aim to discuss the various avenues and aspects that should be taken care of:

1. Diversification: One of the most primary lessons that we learned from the pandemic is how important it is to diversify. One should not rely heavily on a single supplier or a specific geographic region. Businesses should diversify their supplier base, source materials from multiple locations, and establish backup plans to mitigate risks that might cause disruptions in a particular area.
   
2. Technology: Like any other area of life today in general, technology plays a pivotal role in enhancing supply chain resilience as well. Greater visibility and transparency across is enabled through advancements in artificial intelligence, blockchain, and Internet of Things (IoT). One can even identify potential bottlenecks through real-time data analytics and prevent a crisis.
   
3. Collaboration: Establishing strong partnerships with primary and secondary stakeholders fosters better communication and coordination. This helps share resources, information, knowledge and best practices, thereby enhancing the collective ability to respond to disruptions more effectively.
   
4. Robust risk management strategies: Conducting comprehensive risk assessments, identifying potential threats, and developing contingency plans to mitigate their impact are some of the pointers. There needs to be development of dynamic capabilities for the same.
   
5. Agility and flexibility: The traditional models had rigid structures and were accompanied by long lead times but they are not suited to cope up with the volatility and uncertainty of today’s business environment. Hence structures that enable rapid adaptation to the ever changing market conditions and customer preferences must be put into place.
   
6. Culture: A culture supporting continuous improvement and innovation at all levels, with organizations trying to constantly evolve and refine their supply chain processes to stay ahead of emerging challenges is the need of the hour.
   
7. Talent development and training: Enough stress cannot be put on this point. Employees need to be provided the skills and the necessary knowledge to navigate the complex supply chain dynamics effectively. Cross-functional teams can facilitate collaboration and decision-making, enabling organizations to respond more agilely to disruptions as they arise.

Finally, organizations need to note that resilience is a journey and not the destination. Building and maintaining resilient supply chains will be a continuous and ever going commitment and investment. Organizations should continuously monitor and evaluate their supply chain performance against set metrics, identify the suitable areas for improvement, and try to adapt their strategies accordingly. To navigate the complexities of a post-pandemic world, businesses must make resilience as a part of the organization’s basic values to thrive in this increasingly uncertain and dynamic global landscape.

QUICK COMMERCE REVOLUTION

Quick commerce or Q-commerce is a business model that focuses on ultra-fast delivery of goods and services to make on-demand delivery and innovations in last minute delivery a reality. It is changing the landscape of the e-commerce business. The evolution began in 2011 with companies like Postmates but gained traction only in 2017. This paradigm shift has not only reshaped consumer expectations but has also opened up new opportunities for businesses.

HOW DOES IT WORK?

The speed is obviously of utmost importance here and this would come with better management of operations. Earlier, it was believed that the economies of scale is what would lead to generation of lower costs to gain the edge but with the micro-quantities being ordered, the model had to change.

BUSINESS MODELS

1. Third party delivery platforms: This is an asset light model because the players in this category do not hold any inventory, they simply deliver the retail products belonging to the third-party. This helps them avoid the heavy inventory costs. Some examples for this could be Dunzo, Swiggy instamart.
2. Vertically integrated models: These players manage operations from one end to the other, they have their own warehouses where they maintain the inventory and Blinkit and Zepto.

KEY DRIVERS

1. Changing consumer behavior: The modern consumer now values their time and convenience more than they ever did before. Q-Commerce beautifully aligns with this shift in behavior. It provides a solution that not only caters to the fast-paced lifestyles of urban dwellers but also keeps evolving because of the innate agility this model provides. The adoption provides the ability to order and receive products almost instantly and the increasing internet penetration can be awarded some points for this.
2. Technology integration: Q-commerce has been able to grow because of the integration of cutting-edge technologies, including artificial intelligence, machine learning, and data analytics. These technologies enable businesses to predict consumer preferences, thus manage inventory efficiently, and undertake the route deliveries in the most time-efficient manner.
3. Hyper local fulfillment: Quick Commerce relies heavily on establishing a robust network of hyper-local fulfillment centers strategically placed in urban areas which act as hubs for storing products, reducing delivery times by ensuring that the distance between the fulfillment center and the consumer is minimized. With the increasing tilt towards entrepreneurship, many such centers have been coming up or the earlier ones are being roped in this network.
4. Competition and innovation: The competitive landscape of Q-commerce has led companies to continually innovate and enhance their services. This has resulted in improved delivery times, expanded product offerings, and the introduction of subscription models, which has led to fostering a culture of further innovation in the industry.

It is important for the players or the prospective players to make note of these before planning their entry and operations.

OPERATIONAL CHALLENGES

Apart from several others, management of operations definitely is one of the top most challenges because reduction in price and thus the edge cannot come without efficient operation management. There needs to be faster turnaround times, with lower cost and with higher margin for sustained presence in this arena. Some solutions could be:

• Removing bottlenecks in fulfillment processes
• Increasing basket values and customer satisfaction using AI-driven personalization
• Offering low (or no) delivery fees to boost sales
• Rewarding customers for larger basket sizes
• Building a subscription model to promote repeat purchases
• Offering flat rate for delivery services

Q-commerce is poised for further growth with the advancement in technologies. The ongoing transformation not only reshapes the retail landscape but also contributes to the broader narrative of digital economy. In the years to come, Quick Commerce is likely to remain a driving force, redefining the very essence of convenience in the retail experience.

REFERENCES

A Complete Guide for Retailers to Selling Online Fast in 2022 with Quick Commerce Solution

From Quick Commerce to Instant Needs: Exploring Business Models in Rapid Delivery

3 Challenges Grocers Face with Q-Commerce (and How to Overcome Them)

https://www.forbesindia.com/blog/enterprise/quick-commerce-sustainable-or-quick-enough-to-fade-away/

Impact of Food Delivery Apps on the Bullwhip Effect in Food Industry

The growth of the internet has affected many industries, and the food industry is no exception. Online Food Delivery Apps (FDAs) have become popular, reaching a larger audience. The demand for food items in India has increased due to the rising number of internet users in the country. Other reasons for this growth include an increase in the working population, the younger generation, and the growing use of digital payments, especially during demonetization.

The global advancement of the digital economy has made online promotional activities attractive to customers. FDAs act as platforms that bring together restaurants, food eateries, customers, and logistics partners. These apps make it easy for customers to select, order, and pay for their desired food from various restaurants through mobile applications. Popular examples of such apps in India include Swiggy, Zomato, and Uber Eats.

The rise of the internet as a retailing channel has provided food outlets with an ideal platform to showcase their specialties and offer special discounts. Now, even small food outlets in residential areas can easily promote their businesses through FDAs. While this has made it easier for customers to switch between food outlets and generated new demand, the increased competition on a single platform with varying prices and fame has posed a challenge in quantifying the demand for food items in the online food industry.

FDAs have played a significant role in changing the nature of demand in the supply chain. Demand can be categorized as push demand or pull demand. In traditional supply chains, products are “pushed” through the channel based on forecasts, whereas online platforms have shifted demand to a “pull” system, where customers request products according to their needs. This shift from push demand to pull demand reduces the reliance on forecasting techniques and minimizes the bullwhip effect, a phenomenon where variability in demand at lower levels can cause larger variations in demand at higher levels of the supply chain.

The bullwhip effect has five causes: demand signal processing, order batching, price variation, rationing and shortage gaming, and economic reforms such as demonetization.

The FDA (Food Delivery App) relies on various things to work well. It plans how to use resources, organizes logistics, and schedules deliveries. Figuring out the best way to do this is tricky because there are lots of factors that are hard to measure, like how much time customers are willing to wait, how efficient things are, how well deliveries are done, and other things like traffic.

It’s important to understand how the system works for different parts of the supply chain. In this case, the supply chain involves restaurants, customers, and the FDA. The FDA helps restaurants in two ways. First, it gets them more business by using their resources better. Second, it lets them connect with new customers without spending a lot on advertising. This is especially good for restaurants that can’t deliver food themselves. According to surveys, even though some customers who used to eat at the restaurant switch to home delivery, there are many more new customers ordering food online. This means that even if some customers switch, there’s still more business because of the new ones.

For customers, the FDA is helpful. It brings the taste of restaurant food to your home. You can get a variety of foods from different places, all in one order, at your home, and usually at a lower price. This wasn’t always possible before these apps, especially for things like breakfast or lunch. Now, you can even order lunch in the middle of the day. Customers can track their delivery in real-time, and because everything is connected, there’s no confusion or mistakes in the orders. This is great for customers, and because the market is focused on what customers want, it also makes the whole supply chain work better.