E-Commerce is Changing the Manufacturing Industry
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E-Commerce is Changing the Manufacturing Industry

The world of shopping has changed dramatically in the last decade. With overnight shipping and same-day delivery, there’s no need to drive to a store and push through the droves of people milling around when you can purchase an item with the click of a button. The world of e-commerce has even made it easier to shop worldwide. You need a product that’s only made in Europe? No problem, you can easily order it online.

About 79% of the U.S. population are shopping online. This isn’t just affecting online the well-known e-commerce site Amazon. The manufacturing industry is seeing a demand for an easier way to manage their supply chain due to the increase e-commerce has placed on their demand.

Manufacturers are going to need a better system for demand forecasting, inventory management, warehousing strategies, technology integration, and distribution practices to keep up with the e-commerce demand.

The best way for manufacturers to battle these new challenges is to increase visibility into the supply chain among multiple departments in the company and increase agility in responding to change. Using an ERP solution can help to mitigate these challenges and increase visibility.

Market research and consulting firm, IDC, released their predictions that will affect the manufacturing industries supply chain due to e-commerce:

  • By the end of 2016, the majority of all manufacturers will be actively employing commerce networks in their supply chains to facilitate either demand, supply or the development of new products.
  • By the end of 2016, one-third of all manufacturers will be actively integrating their “traditional” supply chain processes with product and network design, manufacturing and service.
  • By the end of 2017, the need for visibility, scalability and flexibility across the value chain will drive 60% of manufacturers to invest in cloud-based warehouse management systems and transportation.
  • By 2018, 75% of manufacturers will coordinate enterprise-wide planning activities under the umbrella of rapid integrated business planning management systems solutions aligned to their trade partner networks.
  • By the end of 2019, enterprise-wide improvements in resiliency and visibility will have rendered short-term forecasting moot for 50 percent of all consumer products, and 25% of all others.

An ERP solution makes supply chain management and distribution forecasting easy. For manufacturers to keep up with the demand of e-commerce, there will be an increase an ERP usage and supply chain management applications.

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