The COVID-19 pandemic and the subsequent closure of physical stores have fundamentally changed the way businesses operate. With consumers across the globe turning to online shopping, an increasing number of brands are taking the direct-to-consumer (D2C) route to create a distinctive customer experience. 

In India, the D2C explosion started well before the crisis made an impact, but the pandemic has undeniably opened a goldmine of opportunities for businesses looking to strengthen their digital presence and remove the middleman to sell their products directly to consumers. 

Considering supply chain forms the backbone of any successful e-commerce business, it then becomes imperative for D2C brands to streamline their supply chain processes to optimize their shipping costs, reduce RTO and maximize business growth. 

That said, let us take a look at how companies can better manage their supply chains by leveraging modern technologies such as AI, data analytics, and cloud computing. 

Cloud-based Inventory Management

Unlike their larger counterparts, SMBs in the D2C space lack the financial means to build a dedicated warehouse or a storage facility. As cloud-based inventory management solutions eliminate the need for investing in a physical warehousing space or expensive WMS solutions, D2C brands can manage and track their inventory online from a single platform. Migrating to a cloud-based investor will not only allow them to lower their inventory costs but also improve order accuracy by eliminating the chances of errors during stock pickup and delivery. 

Data-driven Insights with AI 

D2C brands must harness the power of AI to gain access to data-driven insights into their orders. Artificial intelligence can take into numerous parameters like maximum NDR conversion, allocation based on product characteristics, destination characteristics, the channel used to place an order, etc. to facilitate faster delivery and higher customer satisfaction. In addition to giving the fastest and cheapest recommendations as per specific requirements, AI-led tools also help D2C sellers to weed out fake buyers, thereby reducing RTO orders and eliminating unnecessary logistics costs. 

Forecasting Customer Demand 

AI’s ability to analyze huge volumes of data makes it a game-changer when it comes to predicting customer demand across geographies and product categories. Based on the forecast made by AI, D2C brands can restock their inventories when and as required, lower their RTO and minimize waste in their supply chain. Additionally, they can make quicker and smarter business decisions that will help them drive long-term, sustainable growth in the e-commerce space. 

Real-time Updates

Technology has allowed for greater supply chain visibility by offering real-time updates to D2C businesses. As delivery convenience remains the top priority, brands should incorporate technology-based solutions into their supply chain network to track, monitor, and manage their orders in real-time. This will help bring greater transparency to the ecosystem and enable D2C companies to streamline their order-to-delivery process. Moreover, real-time updates ensure timely delivery of products as sellers take proactive measures in case of anomalies. 

According to a recent report, India’s D2C market is estimated to reach a whopping $100 billion by 2025. While it presents a huge opportunity, many D2C brands struggle to navigate the complex world of e-commerce as they are faced with multiple roadblocks. Among others, creating a robust supply chain network that ensures seamless procurement and delivery of products remains a key challenge for D2C companies, especially MSMEs which do not have access to the same resources or the technological expertise as large e-commerce giants. This is where third-party logistics solution providers step in by providing end-to-end guidance and technical assistance to D2C brands. 

With their tech-based, integrated approach, e-commerce logistics and shipping aggregators allow sellers to access best-in-class logistics services which include a multi-functional dashboard, multiple pick-up locations facilities, inventory management, billing, and weight reconciliation, merchant logs, and NDR management to increase their logistics efficiency and help cater to their customers in a more cost-effective and timely manner. This will further unlock new growth opportunities for businesses and set them apart from the overcrowded D2C space.