Every year more people push back their holiday shopping until the week before Christmas. I don’t have the data to prove this, but I still know that it’s true.
My theory rests on the fact that it’s so easy to find what you need on the Internet. You don’t need to worry that your local stores won’t have the perfect gift. Last minute shopping through online retailers like Amazon.com (NASDAQ:AMZN) is simple and quick.
It’s an amazing system. But it certainly hasn’t come cheaply. All of these retailers have spent megabucks to have their order fulfillment and IT systems built to perfection so you can procrastinate.
Amazon is the best example, especially after its 60 Minutes segment that featured prototypes of flying drones for Amazon Prime Delivery.
If you caught the segment, you may have realized the underlying theme hidden behind the more promotional angle: maximizing supply chain efficiency is at the forefront of the company’s growth strategy (you can view the clip here).
Supply chain talk can be pretty dull. I get that. But it’s also pretty darned important to understand how supply chains work — and why they are a source of competitive advantage for companies, like Amazon, that push the limits.
Supply chain efficiency is absolutely critical in our Internet-enabled world — so much so that many companies build their entire business models around it. If you’re a company that deals with physical goods of any kind, then arguably an efficient supply chain is everything.
Now, my reasons for recommending a supply chain specialist to Top Stocks Insights subscribers recently aren’t specifically related to Amazon’s 60 Minutes spot on Sunday.
To be perfectly clear, drones have nothing to do with my investment thesis. Rather, the 60 Minutes segment once again illustrated exactly how crucial an efficient supply chains is in today’s economy.
A super-efficient supply chain is why Wal-Mart (NYSE:WMT) is able to offer such low prices.
A screwed up supply chain was part of why Best Buy (NSYE:BBY) almost went bankrupt. Fixing it is part of why that stock is soaring these days.
And Blockbuster DID go bankrupt because it failed to see how a supply chain innovator, Netflix (NASDAQ:NFLX), would achieve competitive advantage through a new supply chain business model: DVD by mail.
Importantly, it’s what gets the product from point A to point B. But even more importantly, it determines the profit you’ll make when the delivery, AND those pesky returns, are complete.
This is more true today than at any time in history. That’s because most vendors have both physical and online marketplaces. The Internet has become the great equalizer.
Switching costs are ultra-low. If the goods are the same, then price, availability and delivery time usually drive the purchase decision. In other words, customer loyalty often depends more on supply chain efficiency than brand (of the vendor, not the product).
Supply chain efficiency is only going to become more of a competitive advantage as time rolls on.
That’s probably not what you’re thinking when you sit down at your computer to make those last-minute purchases. But I guarantee that the retailer you buy from has given it a heck of a lot of thought.
I’ve included my favorite supply chain specialist in a report our company published last week titled Best Stocks for 2014. I’m completely convinced that supply chain efficiency is one of the best “hidden” investment trends that few investors think about, but which we all have come to rely on.
Inside this report, you’ll discover 10 investment ideas from our team of advisers here at Wyatt Investment Research. Our marketing team has been authorized to give away this report as a holiday gift for our customers. To get all the details and to claim your copy, just click here now.