Will maritime e-commerce be the ‘new normal’ after COVID-19?
106 days ago
It is fair say that the COVID-19 global pandemic will be the most shocking and defining event of 2020. It will have economic implications that last well into the decade, around the world, and across the maritime sector.
So, what does this mean for digitalisation and maritime e-commerce?
A change in e-commerce buying behaviors, globally
One of the responses, we’ve seen to how people are approaching this period of isolation and uncertainty is in huge overnight changes to their buying behaviors. From bulk-buying to online shopping, people are changing what they’re buying, when, and how.
There’s no doubt that the crisis has created an incredibly difficult commercial climate. Businesses are being presented with many new challenges as international borders close, high street stores shut their doors and people are isolating at home. Many companies face temporary or even permanent closures, with staff facing months of financial uncertainty and worry.
Looking at the retail sector, many are finding themselves in a sticky situation. How do you make money when you’re forced to shut up shop and don’t sell online? One high street retailer, famous for its fast fashion, has seen their monthly sales drop from £650m to £0, due to the fact, they don’t have an online store. How could this ever be sustained for any period of time?
We’re all becoming more tech savvy
Across all industries, changes are being made. The true impact on staff is currently unknown. More and more companies have been forced to work remotely and adopt technology. There is a general upward trend of more tech savvy businesses and staff, when compared to 3 months ago. This is predominantly due to the widespread use of tools such as Zoom, Google Hangouts and Webex which have enabled more companies to operate effectively. This adaption makes us wonder…
Will companies and staff now see the benefits of homeworking? Probably.
Will companies who have made redundancies or furloughed staff be under such tight financial constraints that they do not re-employ all those they have let go? Probably.
Will companies realise that they are able to operate with less people and office space, therefore cost? Probably.
Is the above, all possible without technology or e-commerce? Almost certainly not.
For the businesses that remain active at this time, questions are inevitably being asked. How do we cope with the prevailing trading conditions? And what’s the best way to adapt our strategies? These are both difficult questions to answer as we’re in new territory, so it’s very unlikely that many have planned for this scenario. (Apart from Bill Gates perhaps, who foresaw and spoke about the next outbreak after Ebola, back in 2015).
Those with ‘digital’ strategies are better positioned to survive
A fair conclusion is that companies with robust e-commerce to either buy or sell have fared best in our new world, which needs to be a huge learning for those in maritime.
In the world of bunker fuel and lubricant purchasing, you don’t need to look far before you see companies furloughing staff to remove costs from their business so they can survive. But survive is what they will need to do. And, this will be the new normal.
They will need to operate as a leaner organisation, which, is likely to be a catalyst to reduce headcount and some furloughed staff, not returning to work. Some may take the tactic of waiting a few months for the dust to settle but if their profits have taken a big hit, it will come, and redundancies are inevitable before the end of the year.
If they are smart, they will realise that you cannot simply cut staff and run leaner; technology will need to take–up some of the slack left by fewer heads.
Investing in maritime e-commerce
Traditional traders and brokers will need to invest in marine e-commerce to automate some of the roles their staff used to perform. However, many traditional brokers and traders will be 2-3 years behind in terms of technology development, so utilising existing e-procurement platforms, like Bulugo, will be a quicker way to serve their customers in our new normal.
Or, with a shift to buying more and more online, we could see online bunker fuel and lubricant procurement providers accelerate at a far greater pace.
As the effects of COVID-19 continue to bear down on the world’s population, and as behavior adapts. Companies with a strong e–commerce offer can ensure they are available when customers need them.
For example, you would expect supermarkets, producers of hand sanitizer, and face masks or pharmaceutical companies to be thriving, and they are. But, with the closure of gyms and leisure centers there has also been pivot to home fitness. The companies with an online presence have excelled. Not only have consumers been buying sports equipment for their homes but brands like, Nike, have managed to increase digital sales by 30%. As a result, of their fitness and e-commerce apps integrating seamlessly.
All too often in the marine industry, we dismiss another sector as not being like us. But they are. In the simplest sense, they have products and they sell to customers. It’s no different. So, maritime companies that learn from them will be the ones who survive this current crisis.
Ensuring you succeed
As customer behaviors shift and online transactions are more common. We’ll see marketplaces change too. They will become ever-more competitive, as companies seek to capitalize on this trend. If you don’t use e-commerce or have an e-commerce site to sell your products, your ability to compete will be severely diminished. In today’s tough economic climate, this is the digital equivalent of a perfect storm.
Companies shouldn’t fall into the trap of returning to traditional ways of buying and selling. They need to seize the opportunity that comes with this disruption. This is the time to be investing into (if not already doing so) or investing more heavily into digitalisation.
Ship operators sourcing products at critical times, in small windows when ships are in port, will seek the convenience of buying online, but also the reassurance. They need to know they are buying from someone who can operate and function normally during times of crisis.
While the world is reeling from the effects of COVID-19, buyer behavior is being forced to change and procurement departments are increasingly moving online. Marine e–commerce sites can capitalise on this and are increasingly complementing traditional methods.
Businesses should consider retaining investment in digital so that they can remain competitive and meet the needs of buyers.
In these uncertain times, there are opportunities; but companies need to adapt or ultimately die.
Want to know more?
To learn more about the new normal and progressing your digital agenda, read Bulugo’s previous article The Digital Shift via Bunkerspot magazine.
Alternatively, see how easy it is and capitalise on the benefits of maritime e-commerce now. Book your demo.
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