Working Smarter, Not Harder, to Make Digital Commerce Recession-Resilient

The U.S. economy is at yet another tipping point. Just two years after a pandemic-induced collapse, the cycle is turning again. The vast majority (97%) of corporate executives polled recently are bracing for recession, or believe we’re already in one. Inflation, supply chain roadblocks and labor shortages have created a perfect storm that will cause sleepless nights from Philadelphia to Portland.

The received wisdom in boardrooms across the land is that building new revenue streams will help their business to ride out the worst of any upcoming recession. But in digital commerce, a different focus is required.

Business leaders in this sector are already struggling to match the sky-high growth they experienced during the pandemic. Now is the time to streamline business operations with more intelligent, automated processes. That in turn will require a more composable, flexible approach to building digital commerce capabilities.

Heading for Recession?

No two recessions are alike. But the circumstances American business leaders find themselves in right now have a few historic parallels. First, consider the persistent impact of COVID-19 on supply chains. China’s “zero-COVID” policy continues to lock down production and create supply snarls for many products heading west. Resurgent variants of the virus threaten to add further roadblocks. Profit warnings have been flying left and right this year partly as a result. This is particularly bad news for a digital commerce sector that is precariously exposed to supply chain risk.


As the world was still coming to terms with these challenges, Russia’s invasion of Ukraine created new logistics challenges, business uncertainty and skyrocketing food and energy prices. While Americans have been shielded from these more than their European counterparts, the inflationary impact has still been stark.

Driven by generous pandemic-era government payments and a red-hot jobs market, annual inflation is now at 6.2%, even excluding food and energy, according to The Economist. Consumer prices rose 8.3% year-on-year in April 2022, eating into personal spending. The push for greater sustainability is only adding to the worsening economic picture.

A formula devised by former Treasury Secretary Larry Summers posits that whenever inflation rises above 4% and unemployment falls below that figure, the U.S. suffers a recession. The country is well past both thresholds now. And while the government still hopes to create a soft landing by raising interest rates, its chances of doing so are receding with each new economic forecast.

Smarter, Better, More Resilient

The conventional belief is that businesses, including digital commerce providers, should be spending their time now developing and acquiring new revenue streams — the better to enhance resilience ahead of the coming recession. There’s certainly nothing wrong with attempting to do so if the opportunity arises. Larger B2B sellers could, for example, consider setting up an industry-specific B2B marketplace to boost profits and offer an alternative to ones-size-fits-all offerings like Amazon Business.

But these aren’t conventional times. For one, businesses don’t have the usual glut of labor that is indicative of a coming downturn. In fact, the opposite is true, with workers in high demand. So the focus must be on doing more with less; on using intelligent automation to make operations more efficient and recession-resilient.

Which parts of the business could be enhanced in this way? An easier question to answer would be: what can’t be? Smarter contract management, warehouse and resource planning, and logistics could all help to reduce costs, improve efficiencies and enhance the buyer and seller experience. Automated volume pricing could help to stimulate bulk orders, while purchasing for more complex products could be simplified via configurable bundles. Automation can also be used to handle billing and invoicing, requests for quotes and much more — streamlining the buyer experience and reducing the strain on seller teams.

The Composable Commerce Difference

Yet here’s the thing. None of this can be achieved effectively via the legacy, monolithic platforms that many digital commerce businesses are still using. Oracle, SAP and others have made billions on the back of these platforms, but they don’t allow the kind of agility and innovation that firms need to enhance business resilience and grow their operations. Instead, customers are trapped inside a walled garden, waiting impatiently for a painfully slow drip of new features.

Instead, sophisticated businesses need composable commerce platforms that offer best-of-breed choice. They unleash innovation by offering customers the flexibility to seamlessly stitch together any new modules they see fit, creating a more customized and dynamic digital commerce offering.

By switching to composable commerce, these businesses can reduce total cost of ownership, increase ROI and move at their own speed, scaling effortlessly when the time is right and discarding what doesn’t work just as easily. At a time of skills shortages, these easy-to-manage platforms also offer ready-made capabilities, minimizing any reliance on in-demand developers.

There may be a storm coming, but composability offers digital commerce players plenty of reasons to be optimistic about the future.

As the Co-founder and CEO of Spryker, Boris Lokschin is interested in the potential of technology to enable companies to build digital transactional capabilities beyond traditional thinking and to transform businesses and whole industries. Since its founding in 2014, Spryker has empowered 150+ companies such as Aldi, Toyota, Siemens, HILTI and RICOH through B2B, enterprise marketplaces, IoT and unified commerce in more than 200 countries worldwide.

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