Why IoT is the Answer for an Optimized Retail Supply Chain

How can retailers optimize their supply chain technology to guarantee consistency, even when things go awry?

Ricardo Gomez Ulmke

Thanks to e-commerce giants like Amazon, online ordering, delivering and tracking have become key facets of our modern shopping experience. With shoppers’ growing expectations for up-to-the-minute tracking and on-time deliveries, retailers need to balance customer-friendly shipping with automation and efficiency. So, how can retailers optimize their supply chain technology to guarantee consistency, even when things go awry?

The answer is IoT.

Sensor-based technology allows retailers to communicate updates from supplier to consumer, enabling shoppers to keep up with every aspect of the delivery process. When suppliers and dispatchers are able to actively communicate parcel activity, delivery networks become far more responsive, and potential challenges are easily anticipated and mitigated. From there, consumers can expect end-to-end transparency, ultimately giving shoppers an active role in the delivery process.

The following examples identify how big brands are using IoT to meet consumers’ expectations for a seamless delivery experience.

Optimizing Problem-mitigation in Transport

For modern consumers, convenience is indispensable. However, the “guaranteed two-day delivery” advertised by many retailers is a big promise — and in an age where postal providers are delivering an average of 28 million packages per day, there is plenty of room for failure. To manage the influx of requests, smart supply chain technology is first brought into the planning aspect of parcel transport. This helps to determine route inefficiencies, geographical landscapes and effectively manage the cost of transport.

To mitigate delivery risks along the way, suppliers are using sensor-based IoT to quickly identify problematic situations like severe weather, road closures or equipment issues. This is completed by enabling the collection, filtration and flow of real-time information between globally dispersed scanners, which helps retail companies maintain a more up-to-date picture of where all of their packages, passengers and vehicles are at any given moment. This overview allows retailers to be proactive, rather than reactive. They can quickly synchronize and exchange critical logistics information, giving them the ability to make last minute changes to delivery routes if problems arise.

Using IoT to Conduct Internal Communications and CX

From the moment they click “confirm order” on their favorite retailer’s webpage, consumers expect to know where their package is until it arrives at their doorstep. To better serve consumers’ high expectations, retailers are using IoT-powered data communication tools to give shoppers direct insight into their entire delivery process. This includes using sensor-based checkpoints to provide customized alerts to ensure that delivery delays and updates are shared in real-time. Opening this line of communication means that retailers can offer end-to-end transparency to customers, alerting them of any unexpected bumps in the road or managing last-minute changes to the shipping process.

IoT is also helping retailers strategically anticipate customer dissatisfaction and complaints. IoT, partnered with AI capabilities, can be implemented into retail companies’ chatbot communications systems to streamline customer service-related tasks through automation and augmentation, optimizing the tedious process of resolving queries and inbound requests during the delivery process.  

Consumers’ growing expectations for fast delivery aren’t going anywhere, and the retailers who master the “smart supply chain” are giving themselves the best chance to not only survive, but thrive in the modern delivery landscape. To stay ahead, retailers and suppliers must adopt IoT-powered back-end technologies that not only ensure deliveries are efficiently managed, but also ensure that customers have a clear view into the shipping process.