Every e-commerce company seeks a sustainable competitive advantage in its marketplace. Quality products, personalized service, multiple payment options, and memorable experiences are all great ways to achieve and maintain this advantage. But there is another source of advantage that many e-commerce firms are either unaware of or unwilling to exploit: logistics.
Logistics can empower your e-commerce company to gain an edge and earn customers’ interest. So how can you leverage your logistics ecosystem to create and sustain this advantage over the long term?
Continue reading!
Implement a Transportation Management System (TMS) Platform
E-commerce logistics are vital to your firm’s health and longevity. Modern-day shoppers want a fast and seamless fulfillment process from the moment they place an order to the moment the product arrives in their hands. If the experience is below their expectations, they will switch brands and make a noise about it on social media, and dent the brand’s reputation.
Smart e-commerce companies understand these realities, which explains why the average online retailer spends 11% of its sales on logistics. And yet, 53% say that delivery and fulfillment logistics are a significant challenge for them. One way to overcome this challenge is to implement a robust transportation management system (TMS).
A TMS is a digital tool that provides a clear, consolidated view of your entire supply chain, including its elements. It helps you gain visibility into your transportation and logistics network with well-organized and centralized data. The data, allows you to track shipments, optimize routes, manage carriers, and handle payments and settlements.
A TMS provides detailed insights into your day-to-day logistics operations and a bird’s-eye-view of overall network performance. It helps you plan and execute the physical movement of goods and optimize their delivery. This information will enable you to identify shortcomings and act quickly to match customer expectations, which ultimately takes your company several steps ahead of competitors.
Leverage Inventory Storage Solutions
According to the U.S. Census Bureau, U.S. e-commerce sales in Q1 2022 rose by 2.4% compared to Q4 2021. As more and more shoppers throng e-commerce stores in the post-COVID world, these businesses must maintain adequate inventory stocked to achieve the agility required to ship at a moment’s notice.
But it’s not easy to find available warehouse space for storage, especially for smaller e-commerce firms. One reason is that the availability of these spaces has fallen in recent years. Another is that skyrocketing online sales over the past couple of years have made it harder to stock enough supply to match demand. These issues create logistics challenges for many e-commerce brands. Then how can they achieve a competitive advantage?
The answer: leverage e-commerce inventory storage options.
Offsite storage is one feasible option. Placing inventory in an offsite self-storage unit clears space in existing warehouse facilities. It is also more cost-effective than renting an entirely new warehouse. Some unit providers give 24×7 unit access and guarantee unit security whereas the others offer climate-controlled storage units for certain products (e.g., wine). Storage or shipping containers provide another way to store inventory. These containers can be stored onsite, thus ensuring that inventory is available on-demand and ready to ship quickly.
Both offsite and onsite storage can help organize and manage your merchandise. Combine these options with business intelligence (BI) software to locate items, ensure orders are fulfilled and gain an upper hand.
Leverage Business Intelligence (BI) to Optimize Logistics
Nothing annoys an e-commerce customer more than seeing an “out of stock” notice on a product listing. Buyers also get irritated when they order a product that is supposedly in stock, only to get an order cancellation notice. In this case, an apology notification won’t make it up to an irate buyer.
Fortunately, logistics business intelligence (BI) is one way to avoid such situations. Real-time, detailed intelligence can help you manage goods transportation, freight costs, and logistics operations from a single platform. You can also access data about customers, products, and delivery conditions and leverage opportunities to reduce shipping times and costs and minimize delivery errors. In addition, accurate, real-time data about package dimensions, freight company, etc. allow you to keep customers in the loop about delivery timelines or delays.
Data analytics also offers a powerful means to track and optimize reverse logistics, which is vital to reducing your returns processing cost. It can help to create a customer-friendly returns process, which can enhance customer satisfaction and affect their likelihood to buy from you again – both of which impact your sales and revenues.
In a nutshell, the right BI solution helps your e-commerce company track supply chain costs, manage freight expenditures, minimize shipping costs, and increase shipping speeds and delivery accuracy. All these benefits can translate into happier customers and give an edge to your logistics ecosystem.
Wrap-up
In the fast-paced world of e-commerce, you need to grab every opportunity to create and gain leverage over others. If your products or customer service are not quite able to achieve this goal, why not do some soul-searching into your logistics capabilities? You might find many improvement areas that can take you ahead of the pack and maintain your brand’s position in the market.
Working with an e-commerce brand aggregator like Ergode is a great way to optimize your logistics function and create a competitive advantage. Contact us to know how we help e-commerce companies achieve preferred brand status in their customers’ hearts and minds – with logistics and technology.
