Dr. Helena Melnikov, Managing Director of the Waren-Verein der Hamburger Börse e.V. Dr. Melnikov leads the Waren-Verein and affiliated trade associations in the sector of wholesale and foreign trade with food products. All of these associations are recognized authorities in import trade whose expertise is valued among experts and which actively represent the common interests of their members.
Not that long ago, Walmart was one of the world's most valuable companies. Today it’s not even among the top 10. What happened to Walmart and is its business model outdated? The business models of retailers which have overtaken Walmart are not directly comparable with that of Walmart. The largest retail companies today are Amazon and Alibaba, whose business models are exponential, rather than linear.
In 2014, Jack Ma, the founder and driving force of Alibaba Group, announced that he wanted to be bigger than Walmart. The story goes that he made a bet with a Walmart manager, explaining that if Walmart wanted to gain ten thousand new customers, it would have to build a shopping center, parking lots, warehouses, etc., whereas Alibaba would only need 2 servers.
This is why digitalization should not only make us think about the process of optimization but also about entirely new business models. A traditional bookseller might have optimized his bookkeeping and improved his storefront, but he would never have founded Amazon. Thinking outside the box makes all the difference. The majority of today’s most valuable companies hadn’t been founded, let alone turned a profit, 20 years ago.
What Do You Think?
Do you believe that the following statements are true? Be completely honest!
"Digitalization means that I'm gambling with my customers' data."
And what would happen to your paper folders in case of fire or water damage? The cloud would not be affected. You can access it from anywhere at any time and you can increase security through additional measures.
"Automated processes take control away from me."
Digitalization doesn't mean working without human oversight. Digital systems primarily serve to enable routine work to be performed more precisely and more efficiently.
"My business runs even without digitalization."
That may be true but, for how long? More and more people are buying and selling online, both in the B2B segment as well as B2C. People expect digital solutions to practical problems.
"Digitalization is too expensive."
Actually, it saves you money. The sooner you digitally optimize your processes, the more efficient they will become. Customer requests are integrated into production without a great deal of effort, regardless of whether they involve the dimensions, quantity, packaging, etc.
"More digitalization means more risk of failure."
The risk of failure of modern systems, machines, and sensors is much lower than the risk of failure of people.
Blockchain “The Magic Notebook”
Blockchain “The Magic Notebook”
New requirements demand new solutions. Transparency is becoming increasingly important, particularly in the food trade, as customers desire comprehensive information about origin, breeding techniques, working conditions, waste, etc. Thus, the world of politics is responding to this with statutory provisions. These days there is no more getting around the issue of consumer protection and the provision of information. New models take this into consideration by focusing more on transparency and monitoring and less on trust between the parties involved. This includes blockchain.
Blockchain can be defined as a distributed, permanent ledger of securely recorded transactions. It’s like a magic notebook that all participants own at the same time and which duplicates each note automatically to other participants.
By distributing databases among multiple parties, blockchain eliminates the need for intermediaries who were previously required to act as trusted third parties to verify, record and coordinate transactions. By facilitating the move from a centralized to a decentralized and distributed system, blockchain liberates data that was previously locked away in silos. This presents us with two things to consider:
- Blockchain can be used to track your product life cycle and transfers of ownership from origin to store shelf, even as it passes between the manufacturer, logistics service provider, wholesaler, and retailer.
- It can automate your business transactions and eliminate the need for some administrative operations.
Many people are therefore concluding that blockchain is very likely to influence all sectors of industry, particularly in areas where customers and consumers insist on transparency.
Imagine that your business is transparent and decentralized. All transactions are shared by multiple parties in one database. Data can only be updated with the agreement of network participants.
And if everyone's asking themselves whether there will still be importers in 20 years, they might also ask themselves whether there will still be retailers as we know them in their current form.
After all, can you really imagine that your grandchildren will have the same consumer behavior as you do? Of course they will eat, but will they first drive to a supermarket, place products in a shopping cart, stand in line at the counter, pay in cash, carry everything to the car, drive home, fill the fridge, and cook? These processes will presumably change as well, and when they do, the business model that best accommodates customer priorities will win.
Just don't forget: "It's not the customer's job to know what they want." – Steve Jobs