The e-commerce sector is experiencing unprecedented growth, with projections from EMarketer indicating that global sales will exceed $6 trillion in 2024. This boom represents over 20% of total retail sales transitioning to online platforms. A survey by UPS Capital involving 500 e-commerce merchants and 1,000 consumers reveals a critical juncture: businesses that neglect to evolve their supply chain strategies may fall behind in this rapidly advancing e-commerce era.
International Shipping Hurdles
A significant portion of merchants, 45%, are now shipping over a fifth of their orders internationally, aligning with the 73% of consumers purchasing from abroad. However, the past year has seen 73% of merchants affected by international shipping issues, including delays and product damage, largely due to congested ports overseas.
Warehouse and Returns Management
Apparel merchants are particularly feeling the strain, with 50% citing limited physical storage as their top challenge. Close behind are concerns with quality control assurance and inventory stock level discrepancies. Additionally, nearly half of the merchants suspect fraudulent activities in over 20% of product returns, attributing this to lenient return policies and the imperative to maintain customer satisfaction.
Consumer Concerns and Shipping Speed
On the consumer front, the prevalence of counterfeit goods is alarming, with 42% perceiving an increase and 23% having received counterfeit items. Moreover, there is a disconnect between shipping speeds: 42% of merchants report a two-day or longer preparation time for shipping orders, while 46% of consumers expect delivery within three days.
The report by UPS Capital highlights the pressing need for e-commerce merchants to fortify their supply chain operations, addressing international shipping challenges, warehouse management, return fraud, and consumer expectations to stay competitive in the fast-paced e-commerce marketplace.
