New retail report reflects global supply chain crisis and indicates a shift toward the print-on-demand e-commerce model

A new report published by Digital Commerce 360 and the global print-on-demand tech unicorn Printful has unveiled key insights into the biggest issues being tackled by e-commerce retailers and brands in 2022, with traditional retail models and supply chain backlogs impacting the ability to react to trends and minimise inventory-related risks.

Digital Commerce 360, a leading source for ecommerce research, in conjunction with print-on-demand leader Printful, surveyed 66 online retailers and brands in relation to the most important issues currently facing the ecommerce industry. The report, titled “How to increase your product catalogue and test design ideas without inventory risk,” also looked at solutions such as print-on-demand and drop shipping, and why these sectors can expect considerable growth over the coming years.

Here’s what the data found:

Trends, testing, and inventory risk key issues in 2022

Of the retailers and brands surveyed, the key issues facing the industry included the need to be able to react quickly to trends (86%), the ability to test new design ideas (74%), the need to increase product assortment (73%) and the ability to allow product customization (61%).

Unsurprisingly, 98% of those surveyed by Digital Commerce 360 said that increasing ecommerce revenue was their top priority. However, the report found that other key issues included being able to respond to trends, cited by 86% of respondents. The very next priority was minimising inventory risk and investments, with 77% calling that important, including 44% saying it was “very important.”

Global supply chain issues and long time-to-market  

The Covid crisis highlighted the risk of long supply chains, and 70% of companies responding to the survey say they have had difficulties obtaining sufficient inventory. Another 44% cite ensuring the reliability of their supply chain as a major challenge.

Respondents also recognised the importance of being able to respond quickly to changes in consumer tastes and behaviour. When asked about the challenges they face, 53% cited difficulty in forecasting inventory needs, 36% reacting to trends with new products, and 33% long time to market.

Sustainability and customisation remain key considerations

The report also reflects that both sustainability and customisation remain hugely important considerations for customers in 2022. A July 2021 survey of more than 1,000 consumers found 68% willing to pay more for sustainable products. This was particularly the case for millennial and Gen Z respondents, but of less importance for baby boomers. 

The report also references research recently undertaken by Deloitte showing that one in five shoppers would pay a premium of 20% or more for customised products and 46% would be willing to wait longer to get products made just for them.

The rise of the print-on-demand model

The report goes on to highlight the growth in the print-on-demand sector, a retail model in which products are only printed and shipped once an order comes in. This model minimises waste while allowing customers to fully customise their products—it also eliminates the need for retailers to house large stock inventories.  

Even established brands such as Ralph Lauren have turned to this model, having launched a custom polo in 2021 that allows customers to choose among six designs and 24 colour combinations in addition to adding letters, words, and initials.

By opening fulfillment centers in strategic locations across the globe, companies such as Printful are able to significantly reduce shipping times while allowing retailers to react swiftly to the latest trends, creating online designs that will only be realised once orders are made.

On-demand printer manufacturer Kornit announced a 67% revenue growth in 2021 while print-on-demand leader Printful saw sales grow by nearly 80% in 2020.

However, at the time the research was taking place, only 17% of responding companies were either using or testing print-on-demand. Orbis Research projects sales of print-on-demand software to grow at a compound annual growth rate of 32.4% from 2021 through 2026.