How Micro-Fulfilment as-a-service (MaaS) Can Help Growing eCommerce Brands Overcome the “Amazon Effect”
With the COVID-19 pandemic forcing shops shut, consumers have become increasingly reliant on online shopping to get their retail kick. US eCommerce sales grew a staggering 44% in 2020, and show no sign of slowing. But along with such growth has come an increased demand for consumer convenience.
Market leaders like Amazon have set an extremely high bar for delivery speed and quality. And that makes sense: they’ve spent literally $100 billion developing their fulfilment technologies and infrastructure.
The problem is, the high-speed delivery that infrastructure enables has inflated consumer expectations. Increasingly, all online sellers are judged against the exacting standard set by Amazon – and many are struggling to rise to the challenge.
Sometimes called the ‘Amazon Effect’, this leaves growing eCommerce businesses in a bind: most simply don’t have the resources to invest in a totally new supply chain like Amazon has. But they do need to find ways to fulfil online orders faster and more efficiently, in order to keep customers content and grow their brand.
So what if there was a way for growing brands to offer Amazon-like fulfilment speed without matching Amazon’s budget? If they could, there’s good reason to believe consumers would actively prefer to shop with them.
Amazon has PR problems
Despite Amazon’s dominance, its seat at the head of the table may be more precarious than you think. The company continually comes under fire for its environmental practices, its impact on the retail industry and its monopolistic behaviour – heck, ‘Criticism of Amazon’ even has its own Wikipedia page. And press that bad will inevitably take its toll on a brand.
A recent survey published by Bloomberg confirmed this, revealing that a significant number of consumers have serious reservations about Amazon’s business practises. But thus far, the quality of their delivery and customer service has proven too good to give up.
This means the opportunity is ripe for smaller brands to steal market share from Amazon. All they have to do is change the way they think about their supply chains.
Thinking smarter about fulfilment
Increasing the speed of your fulfilment doesn’t have to break the bank. Sure, Amazon has spent a staggering amount building its fulfilment infrastructure, and that infrastructure definitely works. But that doesn’t mean competitors have to mimic their process in order to achieve similar results.
Instead, growing eCommerce businesses are embracing innovative new approaches to fulfilment. One emerging model that is quickly gaining traction is Micro-fulfilment as-a-Service (MaaS), which enables brands to make use of flexible, dynamic order fulfilment infrastructure without the wince-inducing costs.
How Micro-fulfilment helps you do more with less
Micro-fulfilment centers are small, automated warehouses located near the end-user. They have very high storage density and heavily rely on robotics to process and fulfil orders.
The result is an incredibly efficient, streamlined process that requires very little human labor and ensures unparalleled levels of fulfilment speed and accuracy. The world’s retail market leaders are already investing heavily in their own micro-fulfillment strategies. And for growing brands, MaaS promises to do the same.
You can read more about trends in online groceries in our report here, and let us know how you see the market changing in years to come.
What is Micro-fulfilment as a Service (MaaS)?
Put simply, MaaS is a service model that leverages existing micro-fulfilment sites on a by-use basis. This offers growing brands a host of benefits:
Get closer to your customers in order to serve them at the speed they demand
By selecting micro-fulfilment centers close to their customers, brands can offer same or next day delivery, at the same price they pay for 3-7 business day shipment today. They have localized inventory everywhere they need it, and when an eCommerce order is made, robots fulfil it faster than humanly possible – picking, packing and shipping in a matter of minutes.
Enjoy immediate ROI with no upfront investment
Because MaaS is charged on a by-use basis, no upfront capital investment is required – and brands can see an immediate ROI. All the heavy lifting of integration is included as part of the service, so it requires negligible change management. And all operations are handled by the fulfilment provider, keeping overheads low.
Retain control of the customer relationship and maintain your brand equity
With leading MaaS providers like Fabric, brands remain in control of their fulfilment. They can manage their customer relations, monitor the delivery experience and generate valuable data that will help continually improve their offering.
Ultimately, the model allows retailers to live up to Amazon-inspired consumer expectations, without increasing costs or losing control of their fulfilment. And as it continues to gain traction, we will see even more benefits emerge for growing brands.