Nowadays, more and more e-commerce businesses arise each day. Entrepreneurs find the e-commerce market to be full of demand, and providing consumers with proper products is a way to establish quite a profitable career. However, the online market is overcrowded and very competitive, to put it mildly.
In other words, new e-commerce businesses will have difficulties standing out on such a market. Moreover, it’s not just about competing with others that will ensure hardships.
As a matter of fact, the logistics aspect of the e-commerce trade alone is enough to keep business owners awake at night. If you fail to deliver goods to consumers properly and in an orderly fashion, you will lose the battle with competitors.
Therefore, when starting an e-commerce business, it’s of the utmost importance to ensure that every aspect of order fulfillment ranging from manufacturing to transportation is properly planned out and organized. With that in mind, here are a few logistics considerations to keep in mind when starting an e-commerce business.
1- Product placement and consumer demand
The fact of the matter is that you can sell anything online.
However, whether consumers will be interested in what you’re selling is an
entirely different story. Not just that; whether they will be interested enough
to make your e-commerce a profitable business is a more important question to
ask. In other words, you need to properly choose what to sell that will help
you earn money. More importantly, you have to determine what consumers need so
that you can actually sell it to them.
If you develop your logistic strategy around a product on
good demand, you’ll be able to ensure that the entire process is seamless.
Therefore, conduct some market research before you put any
plans into motion so that you can understand not just the consumer needs,
expectations or demands, but also understand against whom you’re competing against
and how they operate in the market.
2- Shipment and delivery
Another logistic consideration you must focus on is shipment and delivery of goods to the end user or customer. In today’s e-commerce world, customer experience plays a vital role in business success. One major aspect of customer experience is timely and cost effective delivery of products. As an example, if you promise customers same-day or next-day delivery, you can’t deliver products within a week and expect them to be happy about it.
That being said, consider how you’ll deliver products to
customers efficiently. For instance, you can establish your own delivery system
using your own vehicles. You can easily find affordable
trucks for sale if you don’t wish to bother with rentals. On the
other hand, you can outsource transportation to third-party service providers
if you can’t afford to have vehicles of your own. Whichever option you opt for,
make sure that it’s efficient enough to meet your customer expectations.
3- Warehouse management
Another important logistics aspect of an e-commerce business is warehouse management. That includes storing, packaging and labeling of products within your warehouses. Once products are manufactured and supplied to your warehouses, you’ll have to process and organize them for the next steps in order fulfillment. If you don’t plan out this step well you may end up facing inconveniences, such as lack of or excess inventory, misplaced goods and lost products, among other things.
In order to avoid such difficulties, you can plan out a proper warehouse management system that will ensure seamless processing of goods. Today, you can easily achieve that by using a reliable software solution that will encompass every aspect of inventory management ranging from order processing to automation of various tasks. If you aren’t quite big enough for your own warehouse, you may want to look into a company that can both warehouse the products you are selling and provide pick and pack services for shipping the products.
4- Global trade
Many e-commerce businesses trade goods internationally. If
you plan to tackle the global market either straight away or in the near
future, you have to make sure that you’re properly prepared. Global trade is
not as simple as many business owners tend to believe.
The main reason is that you’re dealing with large-scale
logistic strategies, international laws, rules and regulations and distribution
of products to customers on foreign markets. As an example, you’ll have to
ensure your logistics cover storage, transportation, packaging and labeling of
good both at home and overseas. You can partner up with a freight forwarding service provider, who can help
you overcome such challenges that are associated with global trade.
The Bottom Line
Starting an e-commerce business is not simple at all. Aside
from the fierce competition online, there’s an entire world of logistics you
must focus on in order to ensure the success of your business. That being said,
once you’ve dealt with logistics, you can focus on making yourself well known
on the online market.
About Author: Grace Bynes
Grace is a Business Analyst by profession with more than 7 years of experience of working with digital businesses mainly eCommerce and SaaS startups. Grace also loves to travel and explore the world!