5 retail supply chain trends to watch in 2021

Now into its second year, the pandemic has disrupted and forever changed supply chains, especially when it comes to retail. With stores in a seemingly endless cycle of opening, closing, and reopening, consumers have flocked to online shopping like never before—but that doesn’t mean it’s the end for the traditional brick-and-mortar store.

Let's take a look at the key retail supply chain trends to watch in the coming year.

1. eCommerce is coming out on top

There’s no denying that eCommerce has been a big winner during the pandemic. Since March 2020, the shift to online shopping has been massive. Seeking convenience, safety, and reliability, consumers have turned to their screens for an ever-widening range of items that they’re willing to buy online. From groceries and garden supplies to fitness gear and furniture, if it can be delivered to their door, consumers are purchasing it online. And this trend is showing no signs of slowing down.

2. Consumer spending is up

At the start of the pandemic, when thousands lost their jobs and many more were concerned about their employment stability, there was enormous uncertainty about consumer spending. But, as the months unfolded, it became clear that those still employed were actually accumulating savings. Stimulus cheques have also put money in consumers’ hands. Since many people couldn’t spend their money on things like travel, dining out, and entertainment activities like going to a movie, a concert, or a sporting event, they turned to online shopping, especially for items that allowed them to get more enjoyment out of life at home. In fact, the number of online retail categories increased by up to 74 percent year over year.

3. Brick-and-mortar isn’t out of the game

One interesting trend is that COVID-19 has not spelled the end of the brick-and-mortar store, as many feared it would at the start of the pandemic. Store owners have shown incredible agility in quickly adopting the necessary precautions—from masks and plexiglass to social distancing and curbside pickup—to stay open. Staff are going the extra mile to make customers feel safe and comfortable coming back, and those seeking human contact and a more “normal” experience are happy to do so. Some businesses have made simple modifications, while others have completely overhauled their business model to adapt to the new reality.

4. Over-reliance on China is in question

The pandemic was a wake-up call for many retailers, as it revealed that their heavy reliance on China might be problematic, especially when the virus first hit and the supply chain essentially shut down. Scrambling to meet consumer demand, some retailers have partnered with manufacturers and suppliers closer to home.

Border closures around the globe have also led many to question their reliance on foreign products. What’s more, a number of consumers are embracing the “buy local” trend to save jobs and ensure their communities stay afloat during the pandemic. As a result, sourcing locally is growing as a marketing strategy.

5. Innovation and optimization are accelerating

During these unprecedented times, all players in the supply chain are learning to be more agile and work together to come up with innovative solutions. Efforts to improve supply chain efficiency are being embraced and accelerated. Companies looking to streamline operations or come up with new revenue-generating projects are doing so faster than one might traditionally expect to come out of this crisis in one piece—and ultimately thrive.

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Contact InterTrade today to find out how your company can leverage these emerging trends and come out on top during these challenging times.