Sourcing solutions need to be reassessed to meet the demands of the ‘Next Normal’ and ensure you do not lose competitive advantage.
Sourcing solutions will be key to the success of any Retailer, Brand or wholesaler in 2021. The Pandemic has left the world fractured and supply chains have been disrupted. In 2020, most business had to scramble to shift both their internal and external processes to function to some semblance of normality. The challenge that now lies ahead in 2021 is how businesses position themselves to capitalise on a global recovery. Undoubtedly, the effectiveness of their supply chain and sourcing capability will be integral to their success and failure.
Sourcing Solutions – Key Themes
The context of this recovery can be framed in three main themes.
A) The Consumer
Lockdowns have accelerated the transition for many consumers from stores to online. In fact, it has been a forced change in many instances with non-essential shops having to close for extended periods. Consumers and retailers, therefore, had to rely on online interaction and relationships. In 9 of 13 major countries recently surveyed by Mckinsey on Pandemic-induced changes to shopping behaviour, at least two-thirds of consumers say they have tried new kinds of shopping. Moreover, in all 13, 65 percent or more say they intend to continue to do so. There is also a downside in that the consumer became even more fickle and the marketplace that much more competitive.
B) The Products
Notably, in a lot of markets, households have saved money and not an insignificant amount. The Bank of England has recently estimated that British Households have accumulated ‘accidental savings’ of £250 Billion. The consumer is therefore well poised – like a wound coil – to unleash pent-up demand for certain items once markets begin to reopen and lives normalise. Aside from travel and services sectors, the likely destination for this discretionary spend will be the fashion sector. Other sectors that have been resilient during COVID-19 will be impacted to a lesser extent. Companies need to be ready to take advantage of this spend.
C) Supply Chains
Supply chains have had to shift as well. Companies are all too aware now about the over-reliance on a small pool of suppliers or even focusing solely on one market. Building in resilience across your supply chain means greater visibility across all the manufacturers embedded within them but also the need to establish other market substitutes. The current freight rates out of Asia are a good example (up to $14k for a 40ft pre-CNY) and are pointing to other markets as potential opportunities that are not so heavily reliant on long shipping lead times.
Your sourcing solutions, therefore, need to factor in a range of complex, often inter-linked, issues at a time when businesses are primarily focusing on survival.
Sourcing Solutions for the Here and Now
There are many solutions that businesses can look to that address the current challenging environment. Clearly, the travel restrictions in place across regions and countries continue to cause challenges for supply chains where there is no ‘on the ground’ access.
Gaining access to these markets and getting the visibility you need across your supply base is key. Similarly, agility and speed to market will provide a competitive edge when it comes to sourcing new suppliers, identifying new innovations or even accessing new markets.
ET2C’s Solutions
At ET2C, we have a range of sourcing solutions to help you during these difficult times. These give you the access you need, but also build in the agility that is needed to leverage the benefits.
1. Virtual Factory Tours
If you are not able to get to your suppliers, let us bring them to you through our Virtual Factory Tours! These are live or pre-recorded visits on-site via video calls to walk you through the factory and give you the insight you need to make decisions supplier selection. It also gives you the opportunity to view the supplier’s processes and standards in real-time.
2. Buying Office Solution
The best way to get a cost-effective, but scalable solution on the ground across multiple markets. The dedicated team will allow you to develop deep relationships with your suppliers, identify new suppliers but importantly also conduct upstream sample reviews and shorten product development cycles.
3. Sourcing Services
We can give you access to multiple sourcing markets. Also, we can take on the supplier identification, assurance, management and quality aspects of your supply chain. We work as your partner on the ground delivering the products you need for your business.
4. Quality Services
Our quality team has over 20 years of experience of quality assurance and inspections on the ground in Asia. We make sure that we get to the factory to give the visibility you need across product quality and the standards you require.
5. Advisory
We are here to help! Whatever your needs for your sourcing, contact us and we’ll be happy to talk through any issues you may have.
Summary
Creating an agile supply chain in the current global sourcing environment will be essential to driving growth in 2021. There are many obstacles, but with the right sourcing solutions, your supply chain will create a competitive edge.
At ET2C, we are well placed to help manage your Asia Sourcing across multiple markets with teams on the ground as well as work with our clients on their shipping needs. For more information, please contact us at contact@et2cint.com.
