Wedding Bells are Always Breaking Up that Old Gang of Mine

Wedding Bells are Always Breaking Up that Old Gang of Mine

William Laraque

Managing Director at US-International Trade Services

Views 369

Wedding Bells are Always Breaking Up that Old Gang of Mine

17.02.2016 10:45 am

The evolution of e-commerce constantly reminds me of the old (1929) song, "Wedding Bells are Always Breaking Up that Old Gang of Mine." Wedding bells, strategic alliances; "plus ca change, plus c'est la meme chose."

Not a day goes by without there being a rapprochement between retail and industrial e-commerce; between e-commerce and Fintech. The rise of online and mobile shopping has given consumers more choice, more flexibility and better service. It has also created a new commercial vocabulary and caused a disruptive  reorganization in the logistics of delivery and fulfillment. Showrooming, the looking at product, trying on products in store and then buying products online has expanded the commercial vocabulary. Buying online and picking up in store, so called click and collect also adds to the vocabulary. Far from being a fad, click and collect accounted for 30% of e-commerce sales at Sam's Club in 2015. The logistics of e-commerce, online sales has impacted both UPS and the carton industry. The number of ground packages delivered on time during the holidays fell from 97% in 2014, to 91% in 2015, according to ShipMatrix. Such firms as Amazon are seriously examining the creation of their own air and sea logistical organizations and rethinking the "wheel and spoke" concepts of UPS. 
 
The demand for cartons, needed for delivery and fulfillment of consumer goods has stressed both the packaging and the carton recycling industry. Left to be examined is the impact on the lumber industry and trees.
 
E-Commerce Goes Industrial 
 
Whole Foods will consolidate its 12 inventory management systems into one with the help of Infor Inc. The new central system will analyze buying and inventory patterns in order to make restocking more efficient. 
 
Infor Inc., as some of you may know, bought GT Nexus last year. GT Nexus inherited the innovations of TradeCard, which in turn descended from the creation of Guy Tozzoli of World Trade Associates. Tozzoli conceived of the financing of imports and export trade in an automated fashion. The end-to-end processing and financing of orders created from a firm's ERP system, was made possible by insuring its receivables with ECI, export credit insurance, originally provided by Coface. 
 
The technological leap in financing consumer retail products to financing of industrial and capital goods is not as great as one might fear. E-commerce providers will have to create strategic alliances with firms that provide all the support services displayed in the Excelsior chart I have provided above. This too is advancing nicely. The contretemps among banks and platform companies, all of which are increasingly subject to regulation, squeezed margins and the overarching need to please their customers will continue to drive peace (and weddings) among the disparate camps of e-commerce, banking and Fintech.

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