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Why Almost Everybody is Missing the Most Important Point in Their Solution to Amazon’s Threat to Australian Retailers

HOW BIG AMAZON’S THREAT TO AUSTRALIAN RETAILERS?

Yesterday (on 2nd November 2017) I happened to briefly glance at the Australian Financial Review – the key finance newspaper in this country while I was waiting in the lobby for a meeting. Almost the entire paper was devoted to just one single topic – AMAZON’S THREAT TO AUSTRALIAN RETAILERS!

No more do I  subscribe to this newspaper,  because it appears to be growing more and more out of touch with business reality, and becoming more a shill for vendors with deep advertising budgets, and small brains.  Its content,  in terms of financial and economic news is excellent, but somehow the financial journalists always seem to miss the major shifts in the business models – inclduing the latest move towards B2B Networks.

Taking a Sword to Fight a Nuclear Missile

Yesterday’s newspaper seemed to be predominantly dedicated to a conference on e-commerce related subjects. I do not remember the specific topic of the conference, and it does not even matter because the entire debate was centered around Amazon’s entry into Australian market place, and the threat it poses to the Australian retailers and businesses.

Indeed, the organisers, and the newspaper, had identified the burning issue of the day for Australian businesses. They had not only highlighted all the right red flags, but had clearly heralded Amazon’s threat to Australian Retailers as the key front shaping the battle into the next year. Looking at the issues, I almost reconsidered my decision to stop subscribing to the newspaper.

But, alas,  a little more unpacking of the pages revealed that almost all the solutions (to Amazon’s threat to Australian retailers)  were merely window dressing costing a lot of money. Most of them were marketing and sales related, or new age technology related.

Do We Have the Right Solutions to Amazon’s  Threat To Australian Retailers?

What people forget is that Amazon’s success is even more dependent on its incredible supply chain. Amazon’s threat to Australian retailers in not based on its new age technology, as much as it is based on its carefully crafted integral supply chain.

Fighting this successful behemoth without an equally effective supply chain is akin to deciding to fight against nuclear missiles with swords.

Are Australian Retailers Being Led Down A Rosy Path in Their Response to Amazon's Entry?

Sad reality is that most people, even in the lofted positions such as boards, still do not still know what supply chain really means. If you doubt me – just watch the short (1.5 minutes) video below, and conduct the experiment with 10 people you know:

Lest I leave you with a wrong conclusion, I am not totally writing off these marketing and technology solutions. Indeed, they do have a place in the overall campaign.

But, if you get an impression from the newspaper (or the conference that seemed to dominate yesterday’s paper) that somehow you are going to outmarket Amazon just using such solutions – you better think again.

But, if you get an impression from somewhere that somehow you are going to outmarket Amazon using an off-the-shelf software - you better think again.

Whether you are a corner store, or the world’s largest retailer of the decade – one reality stands firm above all else: Nothing beats a carefully crafted supply chain strategy, executed with precision and flexibility. This point cannot be emphasised enough.

If, it is your job to combat in your company the looming Amazon’s threat to Australian retailers, read the following line 100 times.

Nothing beats a carefully crafted supply chain strategy, executed with precision and flexibility - especially for business transformations in dire circumstances.

Now the key question is – HOW DO YOU GO ABOUT WORKING OUT A CAREFULLY CRAFTED STRATEGY IN RESPONSE TO AMAZON’S THREAT TO AUSTRALIAN RETAILERS?

I have written extensively in many other blog posts on how to do just that – all you have to do is explore a bit in the categories and tags on the right of this page. Some of the titles from over the year are in the image on top of this page.

For substantive business leaders, who want to make real and deep positive impact – I do recommend my book The 5-STAR Business Networks.

If you have the budget, it is also worthwhile asking for a workshop based on the same material – but we only have limited slots, and normally have a big backlog for that.

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Vivek Sood

I write about "The Supply Chain CEOs", "The 5-STAR Business Networks", and, how to "Unchain Your Corporation". In my work, I help create extraordinary corporate results using several 'unique' supply chain methodologies. Contact me for interesting, high impact projects, or, to get access to my IP for creating transformations using these methodologies.

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