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Order fulfillment and shipping have always been crucial parts of running an ecommerce business, but they've never been more in-focus than over the last two years. During the pandemic, increased demand consumer demand for goods met head-on with supply chain bottlenecks.
To take stock of it all, ShipBob released the State of Ecommerce Fulfillment report. It offers data from across five countries. For instance , it says the global schedule reliability for shipments September 2021 was an all-time low. In that same month, the average cost of shipping a 40-foot-equivalent container rose to an all-time high of $19,000.
It also offers a look at how ecommerce operators adapted their strategies in the fast-changing environment of the last two years. Findings include:
- More than 70% of brands will add new sales channels in 2022.
- Despite supply chain setbacks, more than 62% of brands expect their revenue to grow by more than 25% in 2022.
- In the US, 35% of all ecommerce orders and GMV are in 4 states: California, Texas, New York and Florida.
- Approximately 56% of brands plan to either ship or fulfill orders from new countries in 2022.
- 32% of brands will start physically fulfilling orders in new countries in 2022.
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GS1 US' Carrie Wilkie discusses implications of the shift for storytelling and the supply chain.
A new dimension is coming to the UPC barcode.
UPCs are a fixture on product packaging, and a key tool in the supply chain. Invented in the 1970s by grocers who wanted a way to track items across multiple retailers, the tags have largely stayed the same since, even as the technology used by retailers and consumers evolved.
That’s about to change.
Two dimensional barcodes are poised to offer the content and visibility that meets today’s expectations from brands and retailers, and data that will power future innovation and regulation alike. Over the last five years, the standards organization GS1 US has worked to introduce 2D barcodes through research and collaboration with industry leaders alike.
The industry set a goal of 2027 to bring this transition to the checkout aisle. Through the campaign Sunrise 2027, GS1 US is educating and preparing organizations for this change.
To learn more about how the 2D barcode will transform packaging, The Current sat down at the NRF Big Show to speak with Carrie Wilkie, the SVP of Standards and Technology at GS1 US. The following interview was lightly edited for length and clarity.
The Current: What is Sunrise 2027, and what is set to occur at that date?
Carrie Wilkie: The evolution from the one dimensional UPC barcode that we know and love and has served us well for over 50 years, to two-dimensional (2D) barcodes on product packaging. The specific goal with Sunrise 2027 is to ensure that retailers can read a two dimensional barcode at the point of sale. Brands at that point can start to transition away from the 1D carrier, if they choose, to exclusively have a 2D data carrier on their package.
The beautiful thing that enables is a whole lot of value added services for everybody in the supply chain. Think about a case where maybe you don't leave a grocery store with a recall product, or you don't leave a grocery store with an expired product. At the pharmacy, maybe you've got some sensitivities that something in the product is going to set off. Over and above that is decluttering the package. So as a consumer, there's one thing we can scan, and a whole lot more information than could ever fit on our product label, but we're not confused about what we're scanning and why we're scanning it. 2027 is the target date when every retailer around the world can scan and read those 2D barcodes.
Let’s break down how two dimensional barcodes work. How will it change the UPC barcode that we know today?
Today, UPC barcodes are one dimensional. All we can put in a UPC barcode is numbers. Typically, in the US, we say that in the form of 12 digits. In Europe, we see 13 digits, but it doesn't give you as a consumer any information about that product. There are different websites where you can do product lookups. A two-dimensional barcode gives you the ability to encode a lot of data into a standardized data carrier.
Most of us, especially with the pandemic, are now familiar with QR codes. We're scanning them for just about everything. You go to your favorite restaurant, and the menu now is a QR code. So you're doing that interaction with your phone, by moving that on to the consumer package where they believe the same thing. And so we're getting all of that additional data that you can encode in the standard way, which means the retailer can read it at point of sale. It means the distributor can read it, and pull out all of those different capabilities that we talked about. Over and above all of that, there can be links to so much more information contained within that barcode that can be enabled either through a scan with your phone with menus, a retailer app, a brand app or a royalty app that unlocks even more possibilities that just simply can't happen with a one-dimensional barcode that only holds 12 or 13 digits.
Looking beyond the retail and consumer level, how will the shift to the two-dimensional barcode bring change deeper in the supply chain?
There are many regulatory pieces around traceability, sustainability and food safety. From a regulatory perspective, it’s valuable to be able to trace products and the footprint. They want to know what materials went into it, and whether they shipped via a rail or trucks, as well as how they moved. Imagine being able to scan a 2D barcode and see not only information about the product itself, but information about its carbon footprint, and then to be able to supplement that by saying, "I want to buy a carbon offset because of this product." There are many use cases that benefit the brand and benefit regulators that start to unlock a lot of possibilities.
Within the industry, what will it take to bring the shift to 2D about?
We started talking about this in 2018. We've spent the last couple of years doing lab research to prove that it's possible, and we've just completed the last round of testing. The research is telling us that it's possible. At first, there was a fear that everybody would have to replace all of the hardware in their stores at massive cost. Guess what? That really isn't going to happen. With infrastructure upgrades being made over the last couple of years, the vast majority of retailers – and anywhere that barcodes are scanned – have the hardware to be able to do that. We did discover the software needed updates. It was great that we discovered that in a lab before things are out in the market. The software providers pivoted quickly and made those updates.
The biggest thing for the retailers is going to be the ability to enable value added services. This includes on-demand discounting based on common products.
The big thing now is releasing real products in market. Testing is great, but it's a controlled environment. It's a robotic arm, it's perfect lighting. In a store, there are consumers. There are cashiers working in the checkout lane. There is lighting. We are testing how all of those factor in and make sure this is usable in the market.
For brands, we know that the currently-in-use one-dimensional UPC barcodes are commonly used in loyalty campaigns. What other uses will two-dimensional barcodes open up?
Two-dimensional barcodes give the brand more of an opportunity to tell their brand story about the product. Adding information provides the ability to tell stories, and that experience can be dynamic. Brands will be able to change content based on the season or based on geolocation. That will provide a different level of engagement that brands can bring to consumers and retailers. Then, anytime you scan a QR code, you're giving up a little bit. They're gleaning that information as well. So it really gives them an opportunity to tell a more robust story to their consumers.