As the e-commerce industry continues to reach further heights, the logistics to ensure orders reaching the customers are becoming problematic. Ever since the COVID-19 pandemic came into play, the complications have exceeded.
Consumers do not like to wait unnecessarily during orders. Once you show incompetence, they will walk away. There are many examples, especially when Amazon lost customers because of delays in their fulfillment regarding essential-only products.
Nowadays, a person prefers to build online shops over in-stores as part of their social-distancing practices. They have got to know about the concepts such as dropshipping so they can be up to the communication speed with their customers.
If you want to offer expedited shipping without a tremendous investment of several warehouses, there is a lot of work to be done. This article will give you a complete overview of it and assure you of how it works.
What is Logistics for E-commerce?
Image taken from Peckham Coal Line
So what is logistics for e-commerce? Is it a way to make a living? The answer is yes. E-commerce logistics is a way of saving inventory for the respective online marketplaces. The operations in this include inventory management. Inventory management is required for shipping or changing online orders.
Every day, we see a huge number of packages delivered across the country. Therefore, preferable systems ensure the procedures are completed efficiently. The operation starts when the inventory leaves the manufacturer’s area and finishes once it is delivered to the customer.
Five Exclusive Factors within a Modern Logistics Chain
Around 40 years ago, suppliers and retailers were on the same page. As e-commerce gathered a lot of attention in the past few years, the inbound and outbound logistics processes have become more difficult to administer. Now, we have the middlemen and moving parts to ensure that the orders are delivered appropriately.
• Suppliers
Suppliers are the people who have the product ready to be taken away to the destination. Suppliers have the responsibility of creating the products. Then, they deliver them to the fulfillment centers once the purchase order is on the table.
• Fulfillment Centers
Fulfillment centers are the warehouses where the inventories are placed near the end consumer. Warehouse workers can deliver the order once the order is placed. Fulfillment centers can be associated with an e-commerce startup business. Once your business grows, you will have many fulfillment centers at your disposal.
• Dispersed Hubs
In both DTC and B2B orders, large e-commerce retailers have their products in many locations in a country. Instead of putting all your inventory in one place, you can split your inventory that enables faster delivery of DTC orders. This will save a lot of time.
For B2B e-commerce orders, you look into a different facility as its procedures differ completely from DTC orders. The different procedures include packaging requirements, customer types, destinations, etc.
• Sorting Facilities
Sorting facilities are usually associated with an ecommerce startup business that is moving a sizable chunk of SKUs (Stock Keeping Unit).
• Carriers
Carriers handle the transportation of orders to the destinations. FedEx, USPS, and DHL are some of the US Carriers that transport products via flights and trains.
Things Needed for your Business to Excel
If you want to be successful in your e-commerce logistics, you need to prioritize supply chain efficiency. This includes technological advancements, resources, and the best training overviews that enable you to scale your business.
• Dispersed Inventory
If you keep all your inventory in one place, it will not be beneficial in the long term. For instance, if your inventory is in Houston and your order is placed in Massachusetts, third-party shipping to a higher zone will be costly.
However, if you live in Massachusetts, it will be cheaper to ship it to you from a warehouse in Massachusetts. To complete this procedure, you need a proactive working of multiple fulfillment centers at distant locations.
• Inventory Software
If you build an online shop for your business, one of the first things you have in mind is inventory management software. Inventory management software does the following functions:
- Visualizing real-time inventory numbers.
- Establishing reorder points so you know when to send further inventory.
- Managing SKUs.
- Collaborating with technological staff.
• Warehouse Working Panel
Image taken from Little Helpers
If you own a warehouse and manage all of its components, you may also require a warehouse working panel. These panels can visualize the warehouse performance and give insight into the improvements required to make it better.
An association with a good third-party logistic (3PL) company means that you will receive updates about your supply chain directly on your mobile device.
• Reports and Analysis
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What was the duration of delivery? Do you have an idea about the perspective of the customer? What are the shipping costs when you move from one fulfillment center to the other?
If you have adequate technological tools at your disposal, you will easily understand the condition of your e-commerce logistics. You will understand how to further optimize your supply chain and save money.
Benefits
Associating with an appropriate 3PL company will be beneficial for the success of your business. The aim is to get a partner that brings stability to your profits as an e-commerce entrepreneur. He must be able to optimize your supply chain appropriately. Associating with the correct partner will bring you the following benefits:
• Two-Day Shipping
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Nowadays, many e-commerce businesses have prioritized logistics networking. Networks enable the business owner to use the facility of two-day shipping for their respective customers. One component of this facility is the dispersed inventory.
As the inventory is distributed across the country, they can contact the nearby warehouses to dispatch the orders directly to the customer’s door. This will save them a lot of time.
Currently, ShipBob is one of the 3PL companies that offers 2-day shipping for their customers. They provide 100% coverage in the continental US even from a single fulfillment center spot.
• Formidable Insights
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Technological advancements have been very beneficial to the e-commerce industry. They provide enterprise-level information at an affordable price for a respective business. Valuable reporting and distribution metrics are ideal ways to get insights into a business.
These methodologies enable you to find out the situation with your supply chain, i.e. things that are working or not working.
• Improved Return Processing
If you bring the e-commerce returns to the inventory, it will be costly and tedious. With an appropriate e-commerce organization or logistics, this procedure has never been easier. An effective 3PL company will monitor the e-commerce returns to make them straightforward.
• Scalability
Apart from all the benefits described above, an effective 3PL company can improve your business’ scalability. Scalability is extremely high. The network keeps the customers satisfied.
Trends in 2021
With the evolution of technology, healthy organizations are crucial to an e-commerce business. It will help you draw a line between a customer’s perspective and a competitor’s perspective. It will give you details about ensuring that your e-commerce business doesn’t break down. Below, I have mentioned a few logistical trends in 2021.
• The Consumer Requires Fast Delivery of Products
Ever since the start of the COVID-19 pandemic, we have seen a record increase in product deliveries around the world. Approximately 60% of millennials today are making online orders if a same-day delivery facility is provided.
Apart from that, we have also seen 60% of shoppers investing more in same-day delivery facilities. Apart from having adequate technological tools at your disposal, fast delivery products are also a necessity. It means that a particular e-commerce business may have to expand its business geographically. Otherwise, it will be very expensive to transfer orders from one side of the country to another.
• Last-mile Delivery is Essential
Since 2020, we have seen an increase in online purchases. Customer expectations have increased. This has created a lot of pressure on the last phase of the logistical procedure. Last-mile delivery is the name of this phase.
Last-mile delivery is the moving of a product from a distribution hub to the consumer’s destination. A shipping carrier carries out the order. The goal behind this procedure is to ensure cost-effective transportation. Last-mile delivery is a massive business in the making. This facility is seen to be valued at around $1.30 billion today.
If the logistics do not meet the consumer’s objectives, last-mile delivery does. There are many lapses within the final phase of the delivery. For example, the consumer may not be at home or there are lapses in the local courier.
Most US shipping carriers, such as FedEx, hand the deliveries over to USPS. From there on, the last-mile facility completes the delivery and ensures that there is no breakdown in the local courier.
Conclusion
There is an increase in demand from all the places around the world for online shopping. This is one reason people are preferring self-shopping nowadays. A considerable order management system can improve efficiency and customers’ perspectives.
One of the major aspects of having effective e-commerce logistics is to have a reliable order management system. Are you willing to find one? Strikingly is here for that. Go to our website and get to know how our platform can help you with your e-commerce logistics today.
