Logistics is the art of getting the right product to the right customer, at the right time and in the right condition. It encompasses several phases: order reception, preparation and dispatch. Delivery is also an integral part of logistics, but is handled by the carrier. To be effective, a good logistics strategy is needed to optimize every stage of the supply chain, from suppliers to customers.
What are e-commerce logistics?
E-logistics, or e-commerce logistics, is the way in which traditional logistics is adapted to online sales.
E-commerce logistics caters to a diverse and changing customer base, and often handles small individual orders rather than massive shipments. It also has to cope with unstable demand, making inventory management and real-time deliveries more difficult. Finally, unlike traditional logistics, which mainly delivers to BtoB targets, e-logistics mainly delivers to BtoC.
Finally, more traditional logistics are generally subject to fixed working hours, unlike e-commerce logistics, which must be able to respond to orders at any time of the day. And just like stores during Peak Season, e-commerce logistics must be able to manage peaks in activity efficiently.
In short, e-logistics requires specific methods and tools to meet the unique challenges of e-commerce.
What are the parallel roles of e-commerce logistics?
Today, e-commerce logistics is not just about shipping and delivering parcels. It is at the heart of a quality customer experience and plays a major role in a brand’s reputation. Several elements define it and give it its centrality.
Promote customer satisfaction and thus company growth
Mastering e-commerce logistics means focusing on customer satisfaction, and to achieve this, a number of criteria need to be taken into account.
The cost issue is paramount. Consumers are looking for the best value for money, and are often reluctant to pay high delivery charges. In this way, optimized logistics make it possible to offer competitive delivery rates without impacting too heavily on the company’s margins. Offering different delivery prices, adapted to different consumers, contributes to customer loyalty, reduces basket abandonment and encourages referrals.
Consumers waiting impatiently for their parcels is not just a cliché: it’s a reality in today’s marketplace. In the age of immediacy, consumers want to receive their products as quickly as possible. They may even be prepared to pay more for D+1 or D+2 delivery. Efficient logistics that guarantee rapidpreparation of your e-commerce orders are essential to satisfy this growing demand for express deliveries.
Reduce and optimize your costs
In addition to customer satisfaction, carefully managed e-commerce logistics can significantly reduce your costs. By optimizing inventory management, minimizing errors and choosing the best partners, every step of the process contributes to the company’s profitability.
E-commerce logistics as a means of promoting your brand image
E-logistics is also an excellent showcase for your brand image, your ecological commitments and the importance of your involvement with your customers.
A well-managed returns process is essential. This goes beyond simple customer satisfaction. It’s proof of the brand’s commitment to its customers, offering them an easy and inexpensive way to return items.
Consumers are increasingly aware of environmental issues. An excellent way of promoting this new image is through reverse logistics, whether through eco-responsible packaging or environmentally-friendly modes of transport, which can positively reinforce a brand’s image.
In conclusion, e-commerce logistics is much more than just managing shipments. It lies at the heart of the customer experience, has a direct impact on company profitability and plays a key role in consumer perception of the brand.
What are the stages in e-logistics?
E-logistics is a complex process involving a number of essential steps to meet customer expectations and ensure smooth operations.
Order processing
This first step involves collecting and recording customer orders from all sales channels. Order information must be accurately filled in and collated to avoid any subsequent errors. Order processing also includes confirming order details with the customer, accepting payment and issuing an order confirmation. This is where OMS e-commerce comes into its own, automating and facilitating the processing of your orders, so you can sell even more efficiently.
Inventory and stock management
Inventory and stock management is a key element of e-commerce logistics. It is important to ensure that products are available in sufficient quantities to meet demand. Companies can use a variety of methods:
- ABC method: Categorizes items according to their value, from A (high value) to C (low value), to optimize inventory management.
- LIFO (Last In, First Out): The most recent items in stock are sold first, particularly suited to the sale of non-perishable products.
- FIFO (First In, First Out): Older items are sold first, and should be prioritized when selling perishable or fast-moving products.
Warehouse organization must also be adapted to the company’s needs, for example, by placing popular items close to the shipping area to facilitate order picking.
Order picking
At this stage, the products ordered are collected and grouped together for shipment. The picking process needs to be optimized to boost productivity, improve the management of physical flows in the warehouse, enhance operator safety and prevent musculoskeletal disorders.
Product packaging
Packaging plays a crucial role not only in protecting products, but also in customers’ perception of the brand. Products must be securely packaged, but the packaging must also be attractive and reflect the company’s brand image. Packaging must be easy to open, made from durable materials and suitable for the product it contains.
Order dispatch
You and your teams are responsible for shipping your orders, ensuring that everything runs smoothly. Once the products have been packed, they are ready for dispatch. The company must choose the most suitable carrier in terms of cost, service and environmental responsibility. It’s also important to reduce parcel voids and to choose a carrier offering environmentally responsible delivery options.
Package delivery and transport
Unlike shipping, delivery is the responsibility of the carrier. This stage involves transporting the products to the customer. Delivery options may vary according to customer preference, product type and location. Options include home delivery, relay point delivery or automatic locker delivery.
Processing returns
This last stage, also known as reverse logistics, includes the management of product returns. A well-thought-out returns policy can improve customer satisfaction and enhance a company’s credibility. Customers must be informed of the return conditions, return deadlines, valid reasons for return and refund conditions. In addition, using return packaging can simplify the process for the customer, and is also more environmentally friendly.
These seven stages of e-logistics are interconnected, and require effective coordination to ensure successful management of e-commerce operations.
What are the different e-commerce logistics models?
When it comes to managing e-commerce logistics, there are several models to consider. Each of these models has its own advantages and disadvantages, and the choice depends on various factors such as company size, sales volume, management capabilities and market specifics.
In-house logistics
Opting for internalization means that you manage all your logistics, including product warehousing, in-house. This gives you total control over operations, which can be beneficial in guaranteeing the quality of your service and the accuracy of your processes.
However, this requires considerable resources, particularly in terms of warehouse space, personnel and inventory management systems. To optimize this model, and find out what your needs are, you need to consider a logistics audit, whether you do it yourself or with a professional. At Shippingbo, we offer a range of logistics audits, so you can choose the one that’s right for you.
Outsourcing your logistics
Outsourcing means delegating your entire logistics management to a third party, be it a 3PL logistics provider, a fulfillment platform or a dropshipping supplier. So you can concentrate on your core business, while benefiting from the expertise of a logistics professional. What’s more, outsourcing eliminates your need for your own infrastructure, which can be a considerable advantage, especially for small or fast-growing companies.
Nevertheless, this model limits your control over your logistics, so it’s crucial to turn to solutions that give you a complete view of your inventory movements. With such a tool, you can ensure more efficient and conscientious after-sales service, as well as the possibility of intervening rapidly with your logistics provider in the event of a change to your catalog…, for example.
WithOMS Supervision Shippingbo, you can connect all your service providers’ warehouses to a single interface for omniscient management of your outsourced logistics.
Adopt a hybrid model
It’s a blend of the two previous models. You can choose to internalize some parts of your logistics while outsourcing others. For example, it may place part of its stock in its own warehouse, but use a 3PL logistics provider for the rest. This model offers maximum flexibility, enabling the company to adapt easily to changing demand.
However, this requires excellent coordination between the various players involved in these logistics. For optimum management of this model, the use of an OMS (Order Management System) such as Shippingbo’s OMS Supervision can be a great help, enabling you to synchronize all stock across all sales channels. This gives you access to simplified logistics management, enabling you to multiply the number of warehouses in your hybrid logistics strategy.
Each logistics model has its own strengths and weaknesses, and the choice depends on many factors. A thorough understanding of the different e-commerce logistics management models and a careful assessment of your specific needs can help you make the right choice.
Who are the players in e-commerce logistics?
E-commerce logistics are interconnected, with multiple players working together to guarantee an optimal customer experience. From your role as e-tailer to that of your technology partners, every element contributes to the efficiency of the system.
You, the e-merchant and your company
As an e-tailer, logistics is one of the pillars of your success. Your strategic choice determines the customer experience, as well as your involvement in logistics management:
- With self-management, or insourcing, you have control over the entire chain. But this requires rigor and organization.
- Dropshipping lightens your load, but requires unfailing trust in your partners.
- Opting for e-fulfillment means outsourcing part of your supply chain, and here again, trust and quality control are crucial.
Logistics is much more than a simple step: it’s a promise made to the customer. Choosing your partners wisely and staying involved is essential. And for this, tools such as OMS Supervision are key allies.
Suppliers
Suppliers are essential to the e-commerce supply chain. In a classic buy-and-sell model, the e-tailer buys products in bulk from a supplier and then resells them to its customers. In a dropshipping model, the e-tailer does not physically own the products. Instead, he places customer orders directly with the supplier, who ships the products directly to the customer. Dropshipping involves a new kind of logistics management, in which everyone has to play their part, seller and supplier alike.
3PL logisticians
Third-Party Logistics (3PL) providers offer outsourced logistics services. They may manage all or part of an e-commerce company’s logistics operations, including warehousing, order preparation, packaging, shipping and sometimes after-sales service. E-commerce companies can call on 3PLs to manage their logistics, particularly when they have large volumes of orders to process, or when they wish to concentrate on other aspects of their business.
Fulfillment platforms
Fulfillment platforms, such as Amazon FBA, are a specific type of 3PL. They manage not only logistics, but also product storage on behalf of the e-tailer. The e-merchant sends its products to the fulfillment platform, which stores the products, prepares and dispatches the orders, and occasionally even handles returns and customer service.
Carriers
Carriers are responsible for delivering products to customers. They can be involved at different stages of the supply chain, from the routing of products from supplier to warehouse, to delivery of products to end customers. Carriers may specialize in transporting bulky loads (such as pallets or containers), or individual parcels…
Technology partners
Technology partners like Shippingbo play an essential role in simplifying and optimizing e-commerce logistics. They offer software solutions that enable you to manage your logistics operations efficiently. These tools can help you automate various tasks, such as tracking your parcels and inventory, managing your orders, coordinating with suppliers and carriers, and much more. Ultimately, they allow you to focus on growing your business while ensuring a seamless customer experience.
In e-commerce logistics, every player is important. As an e-tailer, your role is central, and you can reinforce it by choosing the right logistics service providers and ensuring you use the right tools, to achieve true operational harmony.
What are the different strategies for optimizing e-commerce logistics?
E-logistics is an essential pillar of e-commerce, and mastering it can mean the difference between success and failure. To ensure optimum efficiency, several strategies can be adopted, each offering specific advantages.
A multi-carrier strategy
To optimize your e-logistics, one strategy to consider is to adopt a multi-carrier approach. This strategy involves working with several carriers for your deliveries. This way, you can offer your customers a wider choice of delivery types, and select the most appropriate carrier for each one.
With Shippingbo’s Loader TMS, you can automate the allocation of orders to your different carriers according to their specific characteristics and your needs. This allows you to optimize costs and delivery times, improve the customer experience and secure your shipments.
Omnilogistics
Omnilogistics is a strategy that involves diversifying your storage points. For example, you could consider adding a dropshipping activity to your existing business. With OMS Supervision from Shippingbo, you can manage all your inventory, wherever it’s stored, from a single interface.
This strategy enables you to diversify your business and your storage points without complicating your logistics management. It also enables you to call on external service providers, such as logisticians, fulfillment platforms or dropshipping suppliers, while maintaining secure inventory management. Going even further, omnilogistics gives you omniscience over your logistics, whether in-house or outsourced. This gives you a centralized view of your inventories, order preparation status, etc. In short, you control all your logistics operations.
In short, a multi-carrier strategy and omnilogistics are three effective approaches to meeting consumer expectations. Each of these can be implemented with the help of Shippingbo, enabling you to maximize your efficiency and best meet your customers’ needs.
What are the essential tools for optimizing e-commerce logistics?
To succeed in e-commerce, you need the right tools to manage logistics. They enable efficient management of stocks, warehouses, carriers and much more. Here are three key tools to consider for optimal e-logistics: OMS, WMS and TMS.
OMS (Order Management System)
An OMS, or order management system, is essential for any e-commerce business. It connects their warehouses directly to their sales channels to retrieve orders in real time and synchronize inventory.
Key OMS features include :
- Centralize orders in a single interface for global management.
- Real-time stock updates on all sales channels to avoid out-of-stock situations.
- Smoother exchange of information within the supply chain.
- Intelligent routing of orders to one or more warehouses according to configurable rules.
- Real-time consumer tracking notifications to optimize the post-purchase experience.
In short, OMS makes it possible to simplify order processing, automate order routing, centralize orders in real time, and synchronize stock directly across all sales channels.
The WMS (Warehouse Management System)
A WMS, or warehouse management system, is essential for optimal order picking and warehouse management.
Key WMS functions include :
- Real-time monitoring of stock status, origin, location and destination.
- Organization, automation and industrialization of preparation sessions.
- Inventory management: reserve and picking locations, management of logistics flows and stock movements.
- Multi-warehouse strategy management: unification of stock levels, implementation of order routing strategies using configurable rules.
- Management of packs, batches and bundles to give only available stocks for each reference making up the pack.
Shippingbo’s WMS enables you to optimize inventory management, control the logistics warehouse from a single interface, easily deploy industrial picking processes, eliminate the risk of picking errors, and increase productivity by up to 50%.
TMS (Transport Management System)
A TMS, or transport management system, is essential for managing shipments.
Key TMS functions include :
- Selection of the most suitable carrier to optimize costs.
- Print all shipping labels from a single back office.
- Carrier mapping: assign a specific carrier to certain orders.
- Returns management: automatically generate a returns label and choose whether or not to put the product back in stock.
- Post-shipment tracking: follow the carrier’s progress through to delivery.
With Shippingbo’s TMS, you can simply connect all your carriers, save on your transport costs, print your transport labels from a single interface, and automate the sending of tracking numbers.
In conclusion, OMS, WMS and TMS are three essential tools for optimizing your e-logistics. By using them in an integrated way, you can improve the efficiency of your logistics, reduce costs and improve customer satisfaction.
Maximize your sales with Shippingbo logistics
Logistics, whether traditional or specifically e-commerce, are the backbone of your online customer experience. Not only does it shape a company’s brand image, it also plays a decisive role in customer loyalty and overall growth.
Understanding how it works is key to putting it to work for your success. But the key to optimized logistics lies in partnerships and the use of the right tools. With Shippingbo’s e-commerce logistics suite, eliminate time-consuming tasks and make your e-commerce logistics a real pillar of your online business.
Power your e-commerce with Shippingbo!
