Perishables Power Play: How forwarders are adapting to e-commerce disruption
Can Amazon not be a factor?
Six months after Amazon and Whole Foods announced their bombshell merger, the silence from the perishables forwarding industry has been remarkable. While much of this may come from a reluctance to speculate, some forwarders have dismissed this takeover of a major grocery network by the world’s most disruptive logistics company as largely irrelevant – at least for now.
“As we stand at the moment, Amazon has had very little impact, to be honest,” said Colin Wells, global head of perishables for Panalpina. “The people at Amazon have to develop their forwarding logistics footprint, whereas if you look at Panalpina, we’ve already got an established forwarding and logistics platform.”
One indirect way the Amazon/Whole Foods deal will send ripples through the perishables business will be in the form of a wake-up call, Wells said. “A number of importers and growers and other retailers are finally realizing they need to do something sooner rather than later by viewing perishables on a global scale rather than just a country-centric solution.”
Wells added that Amazon is not yet seen as a major threat in this sector. “If anything, I embrace [the Amazon/Whole Foods deal], because the industry needs changing,” he said. “We believe there’s going to be new virtual e-tailers coming up in the next few years that none of us have even heard of [and] they are going to need choice. Amazon will have their own solution, and therefore we believe that Panalpina will be well-positioned to actually offer solutions to non-Amazon retailers.”
Robinson Fresh’s York said Amazon is merely one of several large retailers that are trying to gain more influence over the perishables market. The $3.3 billion Walmart and Jet.com deal is another great example, he said, along with Chinese e-commerce giant JD.com, which is now investing in offline infrastructure in order to add diversity for its consumers.
“We are seeing that, in order to be successful in this industry, retailers need to have substantial infrastructure and distribution in both e-commerce and brick-and-mortar platforms,” York said. “Consumers are demanding flexibility with home delivery, in-store pickup and traditional in-store shopping. All of these options are important. Machine learning, artificial intelligence, drones and other new technologies continue to push the boundaries for retailers and consumers alike.”
Amazon, York added, is still growing its platform within the fresh fruits and vegetables sector. Purchasing Whole Foods gave Amazon credibility with consumers because of Whole Food’s reputation for quality foods, and it also gives consumers more choices in terms of how they purchase products, but it is hardly the perishables juggernaut it seemed last year after the announcement.
