As each new year rolls around, distributors must recalibrate and adapt to the constantly changing market. The pandemic undeniably put intense pressure on wholesale distributors to change how they operate, and this pressure isn’t going away. Economic instability, new competitors, and labor shortages are forcing companies to find new ways to remain competitive and drive growth.
As wholesalers take on new challenges, they continue to keep in mind the lessons the past 3 years have taught them. For example, companies that invested in eCommerce saw their profits grow significantly as sales moved primarily online. Companies that were lacking in this area had to work hard to catch up.
Research shows that 21% of distributors reported that eCommerce accounts for nearly 30% of total revenues and is expected to rise in the years to come. Data analytics and artificial intelligence are two strategies distributors have adapted in order to take advantage of expected increases in eCommerce sales.
Let’s take a look at which wholesale distribution trends we expect to see in 2023, and how businesses can embrace these changes.
7 Trends You Don’t Want to Miss
Selling through multiple channels, both online and offline is nothing new in the retail sector, but in many cases, the wholesale industry needs to catch up. Omnichannel selling is the practice of conducting business over a variety of channels with the goal of providing customers with a seamless, highly integrated, cross-platform purchasing experience. Omnichannel sales are very customer-centric and always strive to improve the user experience with adaptable and engaging interfaces.
Furthermore, by utilizing the proper technology and analytics, you can gain valuable information about your customers’ preferences and purchasing habits in order to deliver personalized content to them through their preferred channels.
Like most sectors, wholesalers were hit hard during the pandemic. Increases in online sales provided crucial relief to the wholesale industry, and reports say that this trend is expected to continue as more B2B buyers take their business online.
In fact, Gartner predicts that by 2025, 80% of sales interactions between suppliers and buyers will occur over digital channels. Establishing an effective strategy for eCommerce sales is critical for success in 2023, and incorporating an online store into your business is the first step. Allowing customers to make purchases online has become increasingly necessary to remain competitive in a post-pandemic world.
Today’s B2B consumers expect the same level of personalization they would receive from an in-person shopping experience. Businesses are expected to understand their customers’ individual preferences. Marketing teams need to adapt their strategies to provide shoppers with what they want when they want it. B2B personalization allows businesses to optimize their marketing efforts by targeting high-intent customers, communicating with them in real time, and delivering tailored advertisements via the most appropriate channels.
In 2021, in part of what is known as the Great Resignation, 47 million US workers quit their jobs, with wholesale being among the most affected. Frontline workers like truck drivers and warehouse employees have become scarce, and customer-facing employees (support team and sales) are demanding better pay, work-life balance, and improved working conditions.
In 2023, wholesalers must prioritize effective recruitment and employee retention. This starts with improving the employee experience. Ask for feedback and listen to your employees so you can pinpoint areas for improvement. Satisfied employees who feel comfortable expressing their needs are more likely to stick around.
Technology is rapidly evolving and wholesale companies cannot afford to fall behind. Artificial intelligence, cloud computing, and automation are transforming every industry, and keeping up with technology trends should be a key part of wholesale distributors’ operating model.
Distributors tend to be fairly traditional, but the pandemic made it clear that they need to adapt quickly to the online marketplace. In 2023, wholesale distributors need to prioritize eCommerce. 3D product configurators, for example, are an effective way for wholesalers to deliver personalized products to online shoppers and improve the overall customer experience.
The B2B sector must expand into international markets if it wants to prosper. As customers continue to diversify their supply chain, wholesalers must digitize their own supply chain networks. This can be quite an undertaking, but you can start the process by reassessing marketing strategies and implementing processes for accepting international payments.
Smart Inventory Management
If your business still relies on a paper trail for inventory management, it’s time to automate. As wholesalers deal in bulk, managing multiple warehouses and storing massive amounts of inventory can become complicated. Inventory management software can make the process easier on staff and reduce the risk of excess inventory.
Computerized systems track the movement of supplies and sales and make it easier to monitor what is selling, what is not, and overall product demand. Automated processing gives you critical insights into your operation, informing your strategic business decisions.
2023 is certainly expected to bring a lot of opportunities to the wholesale industry. Embracing the shift to eCommerce and staying up to date with digital trends is paramount for businesses to thrive in the ever-changing economy. Start by evaluating the current state of your business to determine how you can position yourself to take advantage of the opportunities ahead. If these trends have shown us anything, it’s that success will be reserved for distributors who demonstrate an ability to plan and prepare effectively for technological transformation that shows no signs of slowing down.