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Boxing With the ‘Amazon Effect’

By Chuck Delaney

April 2, 2018

width=300Technology is easing the pain in our industry, but not without required change. We can adapt and embrace it, or fight it and struggle.

Not too long ago, we all used to joke about being an insta-package manufacturer. Clients’ demands seemed to be totally unrealistic because our systems were complicated and built for the packaging business “realities” of that day. Prices and the number of versions were unreasonable and unpredictable. Estimators would lament: “Don’t they know what they want—and in 24 hours!?” Delivery information and timing were needed when the client called, not when the customer service person could get around to it. Our reps say that the relationships are what clients value, not the new industry innovations allowing for less human intervention. ISO manuals had to be followed, and processes had to be respected by both the manufacturer and client. Projects from start to finish take 10 working days.

Two years from now, we will be hard-pressed to remember those past practices of customer service, because it will be automated. Why? The “Amazon Effect.” That is why. It will automate sales, customer service, project managers, estimators, etc.

Processes will be simpler. Pricing options and instant updates to job tracking (going through operations and shipping) will become the norm, not the exception. A number of companies have followed suit and are supplying pricing in real time. This allows clients more choices when purchasing products and services. Clients will be consolidating and coordinating purchases to secure better pricing, and also allowing us to better streamline our manufacturing.

Transparency of customer insights will be known in a moment by measuring service and quality through online chat and surveys. The internet levels the playing field, and it is merciless in reporting how suppliers rank in their execution of work. Think of the last time you were asked about your experience riding in an Uber or Lyft. With greater transparency comes greater opportunity for collaboration and mutual growth, as opposed to blind competition.

The customer is king. We will have to become laser-focused on customers and, more importantly, focused on the right ones that fit each of our businesses. The more clients buy, the more special services we will offer them. Also, clients will start paying for the extras that sometimes we just give away. People will pay for things they value all day long.

Why are these changes inevitable? It’s the Amazon Effect. It is impacting consumers’ expectations more and more every day. It used to be: “You will receive the package in eight to 10 days.” Now, Amazon is moving to same-day or pickup sites for your convenience. Our industry has to adapt to provide what they want, when they want it, and at a price they like. Amazon’s deliverables have changed our customers’ expectations. It’s time we do the same. In the ecosystem of the Amazon, the trees in the forest grow tall together. Why can’t we?


width=150Chuck Delaney is managing director of GROW Retail Technologies. He can be reached at 708-491-5090 or cdelaney@growrt.com.