Are you an e-tailer looking to diversify your logistics model? Discover hybrid logistics, the solution that combines in-house and outsourced management to meet today’s e-commerce challenges. Learn how to harmonize your channels, warehouses and carriers, while reducing costs and boosting efficiency.
In today’s retail landscape, a major shift is taking place. Merchants, in their constant quest for optimization, are scattering their inventories in various locations, responding to fulfillment requirements or other logistical imperatives. This practice, which combines both in-house and outsourced inventory management, highlights the new challenges facing the retail sector in the 2020s. Indeed, logistics has become a central pillar of competitiveness and efficiency for e-tailers.
But how do you effectively manage logistics that are both internalized, with the company’s own inventories, and outsourced, via third-party partners? The need to harmonize these two worlds has given rise to what we call “hybrid logistics”.
This article presents the fundamental principles of hybrid logistics, its undeniable advantages for e-tailers, and suggests solutions for successful implementation.
Hybrid logistics principles
As a merchant, you’re constantly on the lookout for efficient solutions to optimize your supply chain. At the heart of this quest for efficiency lies the concept of hybrid logistics.
Multi-channel, multi-warehouse and multi-carrier management
Hybrid logistics is based on three pillars: multi-channel, multi-warehouse and multi-carrier management.
- Multi-channel management: with hybrid logistics, you can maintain real-time consolidated stock updates across all sales channels.
- Multi-warehouse: whether you have in-house or outsourced warehouses, you remain in control of your logistics strategy, enabling you to optimize your resources and reduce costs.
- Multi-carrier: With hybrid logistics, you can easily organize your transport plan, whether you use your own contracts, those of a logistics provider, a fulfillment platform or commission agents.
Stock pooling with hybrid logistics
The power of hybrid logistics doesn’t stop at management. It also lets you pool your inventory. Imagine being able to use pooled stock value for other business initiatives. By opening up your warehouse(s) to all your distribution channels, you no longer need to reserve a warehouse for a specific sales channel. So, with hybrid logistics, you can deploy the strategy you want while keeping control of your product distribution.
Referral: The key to a successful omnichannel strategy
Finally, how do you know where to direct each order? Routing orders to the right warehouse is crucial in an omnichannel strategy. Thanks to configurable rules, such as stock availability, warehouse location, or the distinction between B2B and B2C shipments, Shippingbo enables you to implement an optimized routing strategy.
Among the many companies that have adopted this new approach, Sport4Heros, a sports, games & leisure products company, has chosen hybrid logistics with the Shippingbo solution, illustrating this evolution perfectly.
Why hybrid logistics?
The modern, decentralized approach to logistics has redefined the role of CMS (Prestashop, Shopify, Magento…) for many merchants. These content management systems, once considered the backbone of online sales, are now seen as just another channel.
With the right logistics tools and methods in place, a large proportion of your orders can be dispatched the same day. Hybrid logistics enables you to do just that: ship quickly, cut costs and optimize inventory management.
Shipping via the marketplace
Today, many platforms such as Rakuten, Amazon, Zalando, Manomano and many others offer shipping services, also known as Octopia or FulFillment by Amazon. These services enable merchants to increase the visibility of their products and boost sales. For example, with programs such as Cdiscount à volonté or Amazon Prime, a special button is assigned to products. This encourages loyal consumers on these platforms to buy more.
Internationalization and cost reduction
Giants like Amazon have warehouses all over Europe. Internationalization and proximity to warehouses reduce shipping costs. If you can store and deliver your products directly from a neighboring country rather than shipping from France, you’ll benefit not only from lower costs but also from faster delivery. This is particularly relevant for bulky products. Proximity also reduces the carbon footprint, a subject that is at the heart of today’s concerns.
Strategic product positioning
As a merchant, it’s crucial to know where your products are at all times. Hybrid logistics provides this visibility, enabling merchants to better manage their inventory and ship products regardless of their location.
Temporary logistics support
Business growth can sometimes lead to logistical challenges, particularly during periods of high seasonal demand or rapid expansion. In these situations, having a hybrid logistics solution can help to manage the extra activity efficiently. For example, in the event of rapid growth , you may need an additional warehouse. Finding, building or refitting a warehouse can take time. Instead of curtailing your activities during this period, a hybrid logistics solution can provide the necessary support, enabling a smooth transition.
How do you manage hybrid logistics?
Managing logistics in an e-commerce environment demands adaptability, responsiveness and flexibility. Hybrid logistics meets these imperatives, but how do you put them into practice?
Internalization for complete control
By choosing to internalize part of your logistics, you retain direct control over your products. This approach is particularly useful when you want to test a new market, or when you want to guarantee a certain quality or level of service. Having your products at your fingertips gives you a high degree of responsiveness, enabling you to adapt quickly to fluctuations in demand.
Outsourcing to handle large volumes
If your company handles a substantial volume of orders, it may make sense to outsource part of your logistics to a logistics provider. These specialists have the infrastructure, skills and experience to handle large volumes efficiently, allowing you to concentrate on higher value-added tasks, such as developing your business.
By opting to outsource your logistics with Shippingbo’s network of logistics specialists, you can benefit from the know-how of a logistics expert at a competitive price.
Use of marketplaces’ warehouses
One of the major advantages of marketplaces is their ability to offer increased visibility for your products. By using their logistics warehouses, you benefit not only from this visibility, but also from the logistics expertise of these e-commerce giants. This can be an effective solution for managing costs and improving delivery speed, while strengthening your presence on these platforms.
The Shippingbo OMS Supervision package: Your solution for successful hybrid logistics
To succeed in hybrid logistics, you need suitable, efficient and scalable tools. So, if you’re an e-merchant selling on one or more channels, with stocks in different internal and/or external warehouses, the Shippingbo OMS Supervision package has been designed specifically for you.
OMS Supervision offers you several advantages. Firstly, it enables you to retrieve your omnichannel orders in real time, saving you a considerable amount of time and enabling you to send orders for preparation more quickly. Secondly, it facilitates links between several warehouses. This tool is ideal for managing diversified product catalogs, whether packs, lots, multi SKU or EAN. Finally, you’ll benefit from a real-time view of your available stock in all warehouses, ensuring a prompt response to your customers’ requests.
To find out more, watch our full conference on the subject by clicking on the image below!
