In the wake of the pandemic, distributors must be agile and proactive, especially as inflation drives up the prices of industry necessities. Despite ongoing global concerns about COVID-19, there are emerging trends in the wholesale industry that can guide your planning and sales strategies.

How was the wholesale industry affected by the pandemic?

The impact of COVID-19 on the world was huge. The pandemic hit almost every country and most global wholesale industries hard. At the height of the pandemic, more than 90 countries imposed lockdown measures, forcing 3.9 billion people indoors and nearly halting international trade.

Major manufacturing and distribution centers like China were the most affected. China plays a crucial role in the supply chains of companies worldwide. When the country went into lockdown, manufacturers couldn't get the supplies they needed, and production slowed down or almost stopped in many countries. Other key manufacturing hubs like Japan, Singapore, Thailand, and South Korea were also affected similarly.

Wholesalers faced tough times due to distribution problems during the pandemic. Shipping and transportation were nearly impossible because of labor shortages, stricter public health rules, and overloaded ports.

Wholesalers couldn't get new stock to refresh their inventory because container throughput and air cargo traffic declined. Retailers also faced challenges, so they often couldn't sell their inventory.

While industries like hospitality, manufacturing, and tourism suffered, others like healthcare and consumer tech did well. Pharmaceutical companies and personal protective equipment (PPE) manufacturers thrived. Last-mile delivery companies and logistics also performed well.

E-commerce grew a lot during the pandemic. B2B (business-to-business) and B2C (business-to-consumer) sales increased as buyers and sellers turned to online stores to place and track orders.

How are things expected to get normal in the wholesale industry?

The global economy is expected to stabilize in the coming years. Here's how the wholesale industry is likely to return to normal:

Wholesale Industry Upturn

The value of the wholesale market will increase, and the market is expected to grow. Business owners and retailers will work to meet global demand with higher trade volumes. Although the pandemic caused disruptions, it didn't create a long-term decline in the global economy.

Wholesalers should start planning now to take advantage of this positive outlook. Begin by making smart sourcing decisions. Ask yourself, "What products will my customers be interested in?" and "What are the best brands to sell?"

E-commerce will Lead

Digital sales through online stores provided crucial relief for wholesalers during the pandemic. This trend will continue as more B2B buyers move their purchasing needs online. To succeed in this environment, it's essential to have a solid wholesale e-commerce strategy.

E-commerce has already proven to be a smart move for early adopters. You can get ahead of the online sales boom by quickly focusing on e-commerce. Utilize proprietary digital sales channels for this. You can integrate an online store into your business website where B2B customers can start and complete their purchases. Alternatively, you could explore the possibilities of a B2B marketplace.

A B2B marketplace offers all the benefits of a digital storefront without requiring significant capital investment. It provides brand exposure, transaction protection, order fulfillment, and the tools you need to expand your business globally.

Reorganization of Supply and Distribution Chains

Companies are reorganizing their sourcing and distribution networks in response to supply chain challenges. Before the pandemic, the primary considerations were cost and expertise. The focus has shifted to disaster preparedness and geographical accessibility after COVID cut off access to critical suppliers and distributors.

Your distribution company may have new opportunities if you have the right processes and experience. Companies are now seeking distributors offering smarter and safer fulfillment options. You can align your firm with these opportunities in several ways, including implementing automation throughout your entire process.

Growth in D2C Channels

In response to the supply chain crisis, some companies seek safer distributors, while others explore direct-to-consumer (D2C) sales channels. This shift allows them to cut wholesalers out of their supply chain.

COVID partly drove this change, pushing brands to stay afloat with social media and digital D2C platforms. However, newer trends like corporate NFTs are further driving the growth of direct consumer sales.

To respond to this growth, show manufacturers why your service is better. Tell your story if your service is cost-effective, fast, and meets your B2B customers' needs. Another option is to reach out to customers through value-added services by improving the quality of your service and using new technologies to become more efficient.

Increased Focus on Search Visibility

With the shift to digital selling, B2B wholesale distributors focus more on search visibility. Simply being online isn't enough; you must be visible to your target market. To reach more buyers, wholesalers are investing in search engine marketing.

Paid ads and search engine optimization (SEO) are key tactics in this effort. SEO helps create brand awareness and authority, boosting your search visibility.

Wholesalers aiming for success should invest in SEO for their website and e-commerce store. Good SEO practices improve search engine rankings and deliver long-term benefits. Even if you already have a digital storefront on a B2B marketplace or plan to create one, incorporating SEO strategies into your store and website design can be highly beneficial.

Omnichannel Selling

One of the effects of COVID-19 is a growing preference among buyers for multiple purchasing channels. Omnichannel has become a leading preference for consumers, who now demand access to services on mobile, web, and in physical stores whenever they like. Although this trend started in B2C transactions, it's becoming common in B2B sales. B2B buyers expect the same ease and personalization they enjoy in their personal shopping experiences because they interact with retail businesses on their own time.

Labor Shortages

Businesses might still face labor shortages after COVID-19 due to the pandemic and factors like low pay, lack of digital skills, and the need for flexible work arrangements. Wholesalers need to observe this trend and prepare adequately. All your strategic plans will fall short if you don't have enough staff to meet demand.

To address this challenge, consider offering better incentives such as daycare assistance, productivity bonuses, and paid time off. Improved healthcare benefits, mental wellness plans, and programs that protect employee health can also be valuable.

Smart Inventory Management

Wholesalers often need help with large inventory problems since they typically operate at the bulk supply level. Managing inventory becomes more complicated when handling five to ten large warehouses. To address this, wholesalers are adopting inventory management software, which makes the process easier and smoother for employees. This software can be part of an enterprise resource planning (ERP) platform or a standalone solution.

Intelligent inventory management makes it easier to determine which goods are selling and which aren't, monitor stock levels at a glance, project demand, and more. Incorporating intelligent ERP or inventory management software into your operations is a smart move.

Data Analysis

The explosion of big data has accelerated since its introduction in the 2010s. Concepts like the Internet of Everything, the Internet of Things, and the Metaverse rely heavily on big data. These concepts utilize vast amounts of data businesses generate in their daily operations.

This data encompasses everything from how frequently customers order products to their preferences and changes in purchasing habits. Wholesalers can harness this data through analysis to generate sales forecasts, predict demand, and optimize processes. Analyzing this data helps identify areas for improvement and highlights successful strategies. Utilizing this data doesn't necessarily require a significant capital investment. Much of the data can already be accessed through ERP software. Additionally, suppose you operate a digital storefront on a B2B marketplace. In that case, you likely have access to free business intelligence tools to assist with data analysis.

As we move forward in this post-pandemic era, wholesalers must remain adaptable and forward-thinking. The landscape has changed significantly, but with these changes come new opportunities. Wholesale businesses can recover and thrive in this new environment by embracing e-commerce, optimizing supply chains, leveraging data analytics, and focusing on employee well-being. The future of wholesale is digital, data-driven, and more flexible than ever. Those who can quickly adapt to these emerging trends and capitalize on new technologies will be well-positioned for success in the future. As you navigate these changes, remember that every challenge presents growth and innovation opportunities.