Four predictions for the manufacturing industry in 2022

In a guest column, Silvia Aguirre makes predictions for manufacturing for 2022.

2022 will be chapter two for manufacturing’s ecommerce pivot. In 2020, manufacturers had to pivot to ecommerce virtually overnight — disrupting an industry that has long relied on in-person and relationship-based transactions. Throughout 2021, the industry has put in the processes needed to operate in an ecommerce-first world, including updating everything from employee management policies to inventory management. 2022 will be the next chapter in manufacturing’s ecommerce pivot. Manufacturers will have to refine the processes they’ve implemented if they want to stay competitive. Ecommerce measures are no longer a stop gap resolution, but rather the norm for the foreseeable future so every aspect of manufacturing will need to adjust to accommodate digital transactions that happen in real-time. 

The supply chain will continue to cause major disruptions. The highly visible supply chain challenges will continue into 2022. For manufacturers, these disruptions will prompt many to revert back to insourcing instead of offshoring for sourcing goods, creating an uptick in domestic supplier usage. In addition to supply chain bottlenecks, labour shortages across the supply chain will place added pressure on manufacturers. These pressures will prompt many manufacturers to alter their inventory levels, evaluate new suppliers, and make other real-time decisions to keep shipments flowing. 

Omnichannel manufacturing will create new data headaches. With the acceleration of ecommerce within manufacturing, manufacturers must now operate in an omnichannel environment. While omnichannel creates new opportunities for manufacturers to reach customers, it also places a greater burden on the systems powering their businesses. In 2022, manufacturers will have to contend with the challenges of connecting the dots within their ERP systems to ensure all channels and processes are working together.

Expanded tax obligations will come crashing down. The pivot to ecommerce and subsequent adoption of omnichannel selling happened quickly for manufacturers over the past two years. As a result, many manufacturers have had their tax footprint expand dramatically. From selling B2B online to new direct-to-consumer capabilities, manufacturers have created new obligations to register for, collect tax, and manage exempt sales. These new obligations will create a web of tax complexity and risk that manufacturers will need technology to navigate.

Author: Silvia Aguirre, VP, Certificate Management, Avalara.

Publication: Manufacturing Today.