Supply Chain in B2C and B2B Online Channels

Abstract

Nowadays, significant challenges with which businesses have to deal is the digital transformation and the omnichannel environment, which can be materialized through E-Commerce. In fact, due to the Coronavirus outbreak in 2020, lots of customers have become used to the convenience of both making the purchase online and receiving it at the required address. Nevertheless, companies often struggle when developing their omnichannel strategy due to the complexity of adapting their current supply chains to the new requirements of the online business. In connection with this new business trend, the main objective of this project is to start, develop and improve the online activity within a Spanish agri-food company, which has plenty of experience regarding offline operations but none in the online business. Therefore, the aim is to design the most appropriate supply chain to develop this new online business considering omnichannel techniques, the current capabilities of the company and all the requirements to manage food. To accomplish this objective, research is made regarding E-Commerce and omnichannel strategies from a supply chain point of view. Moreover, the specific agri-food company is also analysed from an operational point of view in order to apply the required E-Commerce techniques when developing its online business. For instance, the geographic area to be covered and the sort of products to be offered need to be determined. Actually, the developments followed by two real online food businesses within Spain are also analysed. Regarding the development of the online activity in the indicated agri-food company and considering the research made, it is determined to evolve from less to greater operational risks as explained below: • To begin with, the externalized network of Amazon will be used to commercialize cured products online (note that this sort of product does not require chilled facilities). Despite the fact that operational risks are minimized, the management cost is too high to make the business profitable. • Subsequently, once having acquired some experience and to make the business profitable, operations will be internalized through a centralized supply chain network. The internalization will allow to gain much more first-hand control of the orders’ preparation process and to reduce the costs which have to be paid to an external company. The multicriteria method of Brown & Gibson will be used to select the most appropriate centralized warehouse and, afterwards, its suppliers will be determined so that logistics are optimized. When analysing the sales order history of the inner centralized network from September 2020 to June 2021, it is concluded that, as a future line of research, a convenient supply chain improvement should be made through decentralization, and the optimum decentralized network would be determined when solving the mathematical program that is proposed in this project.