In recent years, technology has completely morphed humanity’s lives, works, and conducts day-to-day business activities. However, since the inception of human intelligence was gauged from the ability to revolutionize trade as we know it, the use of technology can continue our evolution. From Artificial Intelligence (AI) and blockchain to cloud computing and the Internet of Things (IoT), the possibilities to achieve perfection in operations are endless.
Since the 2020’s pandemic, one of the major industries that have witnessed significant shifts in their landscape due to technology is global trade, and e-commerce, in particular, is at the forefront of this transformation.
In this blog, let’s walk through digital transformation in trade and how these innovations can bring improved e-commerce trends in the immediate and long-term future.
The Need for Digital Transformation in Trade
If you’re wondering why the world of e-commerce needs to rely heavily on the latest technologies, here are a few reasons to start with:
1. The Rise of E-commerce:
The global e-commerce market is growing at a staggering velocity. As e-commerce continues to become the primary means of trading for businesses and individual customers, traditional trade methods are becoming outdated and obsolete. Businesses that fail to adopt digital technologies risk becoming part of the lost generation, hence falling behind their competitors.
2. Increased Competition:
The growth of e-commerce has also led to increased competition. With more businesses operating online, customers have more options to choose from. To remain competitive, businesses need to find ways to differentiate themselves. Technology can help businesses streamline their operations, improve their customer experience, and offer new products and services.
3. Complex Regulations:
Global trade is subject to complex regulations, which can vary from country to country. Businesses that operate internationally need to comply with these regulations to avoid fines and legal repercussions. While you are aware of the role of a customs broker, implementing the right software can help them stay updated and perform bigger transactions without a margin of human error. Technology can help businesses stay compliant by automating compliance checks, providing real-time updates on regulatory changes, and offering guidance on how to navigate complex regulations.
4. Changing Customer Expectations:
Customers are becoming increasingly tech-savvy and expect a seamless online experience. This includes everything from the ease of placing an order to the speed of delivery. Businesses that fail to meet these expectations risk losing customers to competitors. Technology can help businesses meet these expectations by offering personalized recommendations, real-time order tracking, and faster delivery times.
5. Supply Chain Disruptions:
The COVID-19 pandemic highlighted the vulnerabilities of global supply chains. Disruptions to supply chains can have a significant impact on businesses, causing delays, increased costs, and lost revenue. Technology can help businesses mitigate these risks by offering real-time visibility into their supply chains, identifying potential disruptions before they occur, and offering alternative sourcing options.
Emerging Technologies That Are Revolutionizing E-Commerce
In the previous section of this article, we discussed the need for digital transformation in the global trade industry and why it is a good thing to implement the latest transformative integrations as soon as possible. In this segment, we will cover the specific technologies that are currently revolutionizing e-commerce and trade, changing the way businesses operate. Let’s take a glance at the top technologies involved in this movement.
1. Blockchain Technology:
In the global trade industry, blockchain technology can be used to create tamper-proof documentation and track goods from the point of origin to the point of consumption. This is a prime step in ensuring transparency and reducing the risk of fraud. It can also be used to automate compliance checks, reducing the time and cost of regulatory compliance.
2. Artificial Intelligence and Machine Learning:
Both these technologies contribute towards helping machines to learn from historical and real-time data and perform tasks that would normally require human intelligence. In the global trade industry, AI and ML can be used to automate tasks such as customs clearance, invoice processing, and fraud detection. They can also be used to provide personalized recommendations to customers based on their purchase history and behavior.
3. Trading Using Digital Platforms:
Digital platforms have revolutionized the way organizations can conduct the business of trading goods. These platforms offer businesses access to a global customer base, making it easier to reach new markets and expand their operations. They also offer features such as real-time order tracking, digital payments, and dispute resolution, making it easier for businesses to manage their operations.
4. Digital Payments Systems:
Digital payment systems such as PayPal and Stripe have made it easier for businesses to accept payments from customers around the world. These systems offer features such as real-time payments, fraud detection, and currency conversion, making it easier for businesses to manage their finances and reduce the risk of fraud.
5. Digital Warehousing:
Cloud-based warehousing is a technology that enables businesses to store their products in warehouses that are managed using the power of sensors and electronic tags. Warehouse management system-powered agencies offer benefits such as real-time inventory management, automated picking and packing, and real-time order tracking. This piece of art in tech business can help traders reduce their operational costs and improve their customer experience.
6. Online Documentation Compliance for Customs Regulations:
Global trade is subject to extremely complex regulations, several of which can hold ambiguity. While the rules are confusing, posing the risk of non-compliance can be a major challenge for businesses in their process of exporting or importing goods through e-commerce channels. Online documentation compliance systems such as the Automated Commercial Environment (ACE) in the United States and the European Single Window Environment (SWE) in the European Union can help businesses streamline their compliance processes by a huge margin. These systems offer features such as real-time updates on regulatory changes, automated compliance checks, and online documentation submission.
While global trade could take a page out of other businesses embracing digital transformation quickly, we need to understand that implementing cross-border integrations can take joint collaborations and proactive efforts from several governments and businesses. We hope that in the near future, we witness the rise of new synergetic unions that can help in quick transitions and implementation of the same, ushering in an era of transparent, clean, and seamless trades across territories.