Retail is undergoing a major transformation globally. Consumer buying habits have changed, new economies are growing faster and traditional brick and mortar sales are in a funk. This has a direct impact on supplier relationships and B2B Integration will play a key role in this transformation.
The 3 trends re-shaping Retail today globally.
1. E-Commerce may not be new in developed markets but it is super hot in emerging economies. Flipkart and Alibaba are growing at a rate faster than established players like Amazon. Instead of opening warehouses companies are increasingly relying on Partners to offer options to consumers. Alibaba's latest US venture 11Main.com and Amazon's venture in India solely rely on other Merchants. Faster integration with merchants is not only important but may turn out to be the most important factor in this race to win the consumer.
2. Brick and Mortal retail is changing. Sames store revenues are stagnating and profits are declining. As a result M&A is picking up. After the sale of Neiman Marcus this year to the latest news of Dollar Tree buying Family Dollar to consolidate the lower end of the market. Retail M&A is expected to be even stronger in 2014. As the retail chains merge, vendor consolidation will happen and B2B Integration will play a key role in not only integrating new vendors but also in evaluating vendor performance and selecting future vendors.
3. Third most important trend is diversification. Companies are trying new store concepts. Walmart is trying smaller store concept in densely populated areas. Walgreens is toying with concept stores that sell grocery, food and beverages. These concept stores are typically located in high population density areas which requires them to replenish faster- running multiple cycles during the day. Which in turn requires faster B2B Integration and with more vendors.
Recent trends indicate that B2B Integration will be more important than ever and continue to play a critical role as the retail sector evolves.