5 Supply Chain Trends Your Business Needs to Know About for 2021


April 6, 2021

So much of what was unfolding in a supply chain was accelerated in 2020. Over the last year, we saw companies scramble for capital investment, implement new technologies, and take more risks to overcome an unprecedented combination of pandemic, economic shutdowns, and supply chain disruptions.

Image showing a graph of trends between 2020 and 2021Last year, our conversations centered around supply chain visibility, resilience, and expansion into new channels. As businesses have started to understand and address these challenges, it’s become clear that many organisations will need to rethink their supply chains in 2021. What’s more, the changes we see this year could have far-reaching effects, impacting the entire decade ahead.

So, what will businesses be focusing on in the year ahead? For the answers, let’s take a look at the 5 supply chain trends we think will be most impactful in 2021, along with insights from ChannelAdvisor and IDC.

#1: Supply Chain as a Service Models will Expand

Today’s organisations need to become more agile and adaptable. As supply chain teams have shrunken in the last year, we’re starting to see organisations take a closer look at their operations. To aid smaller teams, or take the burden off their crews, many of these businesses are seeking institutions that have expertise in specific supply chain areas, to help them scale. In fact, research by Deloitte found that 76% of manufacturing executives planned to invest more in digital initiatives this year.

By outsourcing and automating key supply chains processes, businesses can save time and internal resources, while expanding their connectivity and commerce footprint. Here are a few ways we’ll see that in our 2021 supply chain trends.

  • More 3PL partnerships. 3PLs provide a great opportunity to outsource logistics and inventory management, at a lower cost than adding internal headcount, infrastructure, and real estate. .
  • Outsourced manufacturing and co-manufacturing. Like 3PLs, these services are a great failsafe against closures; but they can also help increase capacity during demand surges.
  • A shift towards multi-enterprise supply chain commerce networks. With lean teams and even smaller IT departments, many brands, distributors, and manufacturers are seeking single-vendor, automated supply chain solutions that come with fully managed services and support that reduce their in-house burdens.

#2: Manufacturers Are Rethinking Their Workforce

According to recent research, 80% of manufacturers are expecting to have multinational operations by the end of 2021. As they expand, organisations are starting to rethink their workforce. There’s been a shift to seeking knowledge workers, instead of traditional data entry clerks. We’re seeing organisations bring to the table more workers with analytics, procurement, and IT skills—technical experts. Many of these are tasked with leading supply chain digital transformations, which brands now realise are critical to managing multinational supply chains.

That’s not to say that domestic manufacturers are keeping the status quo. A survey from Industry Week showed that increasing labour productivity, and finding the right talent were top priorities for VP’s and managers in manufacturing. At the same time, brands are looking to technology to take over basic workflows, so team members can refocus on higher priority projects. For example, Jimmy’s Iced Coffee was able to save 4 hours per day with Integrated EDI.

#3: Omnichannel is the New Normal

“Omnichannel isn’t new, but its steep acceleration in 2020 has demanded more attention and focus on improving the customer experience in areas of ecommerce, personalisation, and product fulfilment.” – Jordan K. Speer, IDC

Analysts and organisations alike have been talking about omnichannel for the last decade, so much so that you might be tired of hearing about it. But based on what we’ve seen, omnichannel sales and operations are here to stay in 2021, making it another impactful supply chain trend. The ability to let customers buy online and pick up curbside or in store (BOPIS), return online orders in store, get direct delivery, or shop however is most convenient for them has been a driving force in the market for a while. 2020 just showed us that the market is already there; not only did eCommerce buying soar 42% YoY in August, but BOPIS sales, which represent a truly multichannel experience, increased 259%.

“Consumers have been very vocal about wanting low- and no-touch options such as BOPIS and curbside, as much for the convenience they provide as for health safety concerns. Retail has evolved to be as much about how you sell as what you sell,” said Jordan K. Speer, Research Manager, Global Supply Chain, IDC Retail Insights. “Omnichannel isn’t new, but its steep acceleration in 2020 has demanded more attention and focus on improving the customer experience in areas of ecommerce, personalisation, and product fulfilment,” she says.

Retail giants are leading the way by expanding from their brick-and-mortar stores to online platforms. As they do, we’re seeing more and more vendors adding marketplace integrations to their existing traditional retail partnerships. In 2021, we expect this trend to continue, with retailers and suppliers alike seeking to get a piece of the omnichannel pie.

To us, it’s clear: a multichannel presence isn’t a nice to have anymore—it’s table stakes in 2021. Speer says that’s absolutely true, and that results from IDC’s recent Retail Consumer Insights Survey show that a majority or close to a majority of consumers are likely or very likely to go elsewhere if they are not offered options of BOPIS, curbside delivery, same-day delivery, and visibility into fulfilment options and costs before they make a purchase.

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