Does the Food and Beverage Industry Have a Place in E-Commerce?
Online grocery shopping is not a new thing — shoppers place their orders, and then someone physically shops and delivers the goods. However, several businesses have popped up that offer meals in a box. These businesses do not use local fulfillment. This raises concerns because of supply chain restraints in terms of keeping food good during delivery. It really makes you wonder if the food and beverage industry has a place in ecommerce.
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Ecommerce Shopping Trends
Ecommerce is still a growing industry. The Census Bureau of the Department of Commerce shows a steady rise in online shopping sales since 2005. However, people have been slow to adopt food and beverage purchases on the Internet until recently. Many consumers are trying businesses, such as Blue Apron, to purchase food and beverage products in the form of complete meals in boxes.
Consumers are trending towards fresh and organic food. They don’t want to eat products that use preservatives or other chemicals that are potentially hazardous when consumed. Consumers are also willing to pay more money for these products and purchase them online. The problem is that these food and beverage purchases offer major challenges for logistics. They require special attention because of their high risk of loss during transit.
Logistics Problems with Perishables
When shipping perishables, you always have to plan for the worst. Plus, not all perishables can be shipped the same way. For instance, bananas have a very short shelf life and they can’t be frozen. That means they must get to customers very quickly. That means businesses do not see a high profit margin when shipping perishables because they must opt for express shipping.
Additionally, different temperatures and humidity levels are required for certain food and beverage products during shipping. Without the proper temperatures, some products can spoil before reaching the customer. These precautions cost additional money that cuts into profits. For instance, many pharmaceutical products must be kept at a certain temperature for the entire distribution process. So, temperature-controlled trucks and other modes of transportation are necessary.
After all of the difficult logistics considerations, food and beverage distributors must also make sure that they comply with government regulations. This adds another level of stress for the food and beverage industry in ecommerce. That’s why it’s taken so long for both consumers and businesses to adapt.
So, Is there a Place for the Food and Beverage Industry in Ecommerce?
In general, it’s not fair to say that the food and beverage industry does not belong in ecommerce because if there are customers, then there is a need. However, the logistics of shipping these products is more difficult, more expensive, and has lots of risk. It is possible for businesses to be profitable, but it is going to take a lot of supply chain planning and consumers must be willing to pay more money to make food and beverage purchases online. With the right technology and a lot more experimenting, these type of purchases will become commonplace. [/show_to]
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