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More companies than ever before are harnessing the power of e-commerce to reach customers around the globe. In fact, according to a report by DHL, entitled The 21st Century Spice Trade: A Guide to Cross-border E-Commerce Opportunity, international e-commerce could grow at twice the rate of domestic online retail in the period leading up to 2020.
If you are selling online and looking to grow your business in global markets, then you need to understand exactly how your operations and your customers may be affected by advances in logistics, regulatory and enforcement changes, world events – and even climate issues.
The fact is, your global sales efforts will only succeed if you can get your products in the hands of your international customers quickly, affordably, and in excellent condition. Having a trusted shipping partner with expertise in international logistics is an important place to start, but you also need to stay informed about larger global trade issues, and how they may affect the movement of goods across borders. With this in mind, as 2017 comes to a close, it’s time to look ahead at some of the most important 2018 trends to watch:
The continued rise of transformative supply chains
In the year ahead, and into the next decade, there will be a greater demand for human-driven and localised supply chains. To get goods to customers as fast and efficiently as possible, more organisations will look at approaches that rely on local warehousing and efficient last-mile delivery. Just as Amazon and its Amazon Prime service have conditioned consumers to expect “free” two-day delivery, Amazon Prime Now is creating a new demand for “same day” delivery.
To compete, other online retailers and logistics providers will be pursuing and implementing new same day delivery solutions, with more couriers on the ground. That strategy will change the way that inventory is managed and stored for many online sellers. On a global scale, that means that inventory will be stored in key international markets for faster delivery. For e-tailers with brick-and-mortar locations, expect an increased emphasis on multi-channel shipping options, including ship-to-store and in-store pick-up.
Additive manufacturing and 3D printing
The rise and full potential of 3D printing has been discussed at length in recent years. Volkswagen, for instance, views the technology as a prominent part of the future. Gartner predicts that by 2020, 75% of manufacturing operations worldwide will use 3D-printed tools, jigs and fixtures to produce finished goods.
We can expect additive manufacturing, a broader “layer-upon-layer” manufacturing approach that includes 3D printing and rapid prototyping (RP), to impact more consumer goods as well. How will these advances in technology impact the way that good are moved around the world? In a Logistics Trend Radar report, DHL has identified 3D printing as a major disruptive force in the logistics world, altering distribution channels and methods so that parts or entire products can be printed on demand anywhere. In addition, raw materials for printing will increasingly be in demand, and logistics providers will likely be moved to create “just in time” shipping strategies so that production can proceed smoothly, and uninterrupted.
Global intellectual property rights
E-commerce has sparked a massive growth in counterfeit goods. According a report by the Organisation for Economic Co-operation and Development, the global trade of counterfeit and pirated goods is worth almost US$500bn a year – approximately 2.5% of all global imports. Most goods are bought online and shipped across borders in the form of small, low-value packages. In a dynamic, global economy, protecting international property rights is a challenging task – and one that requires a multi-faceted approach, including enforcement, policy initiatives enacted across nations, and a dedicated effort by companies to ensure proper trademarking. While large name brands are often in the spotlight when counterfeiting is discussed, the fact is that small- and medium-sized businesses also need to ensure that they are taking steps to protect their intellectual property.
When it comes to enforcement, we can expect customs authorities here in the US and abroad to pay increased attention to the problem. While increased oversight is essential, it does mean that protecting intellectual property rights could mean increased delays in the processing of low-value cross border shipments, and your business needs to be aware of this fact.
Natural disasters and terrorism
After multiple natural disasters across the globe in 2017, retailers and logistics providers will be paying special attention to improving plans to keep the supply chain running even under the most difficult circumstances. Creating redundancy in manufacturing and warehousing can help improve your company’s ability to weather a storm – including an actual storm, an act of terrorism, or political upheaval. By moving parts of your operations closer to your customers, you can help to avoid disruptions and the costs involved in operational slowdowns.
Internet of Things
The Internet of Things (IoT) will continue to transform trade and logistics in the year ahead. In 2018, expect more companies (maybe your own) to employ sensors and smart technology to track goods and streamline operations. In fact, by 2020 it is estimated that more than 50 billion devices will be connected to the internet, up from 15 billion in 2015.
By allowing physical objects around the world to be networked, the IoT gives companies incredible insight into the way their products are used, and incredible control over the way that they move from production to end use. When objects can communicate, inventory can be more precisely managed; goods can be quickly tracked; and problems with transport or delivery can be immediately diagnosed and remedied.
Greg Hewitt is the CEO of DHL Express US. This article was originally published on the DHL Expressed blog.