How do supply chain issues affect a company’s business impact? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
Over the last few years, supply chain disruptions have come to the forefront of consumers’ minds and the impact on businesses has increased notably. As we know, many of these disruptions unpredictably arose in the wake of the pandemic i.e. ports shutting down, manufacturers closing, the influx of online shopping, etc.
Issues like shipping delays, order defects, shipping damage, and lost orders cause churn and dissatisfaction among customers, and loss of revenue for businesses. In this day and age, it’s common for businesses to be experiencing these challenges daily and our team at Sisu wanted to understand just how much of an impact these disruptions have on customers’ feelings toward businesses.
During the 2021 holiday season, The Harris Poll conducted a poll on behalf of Sisu that revealed three important things: Supply chain issues are changing the way consumers shop, brands’ reputations are taking a hit from supply chain incidents, and keeping disappointed customers loyal is actually pretty simple.
The poll found that a majority of American consumers (89%) purchased gifts online in the past year, with almost 3 out of 4 (71%) experiencing supply chain issues. And as it relates to supply chain issues, those who did experience these issues were faced with late delivery (64%), order processing delays (49%), or orders missing in transit (31%). One may assume that holiday shoppers would potentially avoid the long in-person lines due to COVID-19 but 72% of American consumers revealed that their gift shopping habits actually changed during the 2021 holiday season in an effort to avoid possible supply chain issues. Nearly half (46%) said they started shopping earlier than usual, and around 38% finished shopping earlier than usual. Now how does this impact a brand’s reputation? Most consumers (82%) noted they would experience a “slight” or “major negative impact” on how they view a company if they experienced a late delivery, while roughly 3 in 4 American consumers (74%) feel retailers should be held accountable for those supply chain issues caused by their carrier partners.
Since we are data people at Sisu, we wanted to go beyond accepting that supply chain incidents are increasingly impacting customers and use data to understand what retailers can do to mitigate these issues. After digging into the consequences of supply chain impacts, we now have a better understanding of how these incidents impact consumers and what steps retailers can take to not only repair reputation damage but also potentially increase the likelihood of repeat purchases—even after a late delivery.