According to Eric Rice's article on Supply Chain 24/7, ecommerce growth in 2017 grew faster than it has since 2011, growing 49 percent, moving from 10 percent of total retail sales to 13 percent.
Unfortunately, ecommerce shipping practices, although different from traditional retail shipping, still fall short.
Supply chain leaders need to understand why logistics fundamentals will continue to shape ecommerce shipping strategy.
The majority of distribution centers have enacted small process changes to handle increased demand due to ecommerce.
Minor improvements in the warehouse management system can help fulfill more orders, but the entire process will fail without a focus on the transportation strategy.
In other words, filling more orders is great, but it still requires significant use of logistics resources. Since 80 percent of distribution centers operate on manual processes, lost opportunities become a major issue.
Think about it; customers want the best deal, so how can a company offer the best deal without taking advantage of the lowest logistics costs?
In addition, ecommerce shipping practices must consider labor management, specifically loading and unloading, as well as yard management.
What every step in the supply chain before an order leaves on a truck is an opportunity for lost revenue.
Developing a robust ecommerce shipping strategy must still rely on the traditional use of shipping practices, ranging from intermodal shipping to LTL and beyond.
The best way to meet the rising demand of ecommerce is to ensure optimum use of transportation resources.
Transportation resources include the use of all available modes and existing physical locations, such as distribution centers, brick-and-mortar stores, and pickup centers.
Even Amazon has gotten in on the challenge with the creation of Prime Pickup locations. That’s the key phrase. Amazon, an ecommerce behemoth, has built multiple locations to take advantage of brick-and-mortar benefits.
However, the key lies in getting customers interested in visiting the location. As explained by Disney Investment Group, this includes selecting a location that has a necessity-based anchor, like a grocery store.
In terms of shipping strategy, it is about making sure customers have access to the easiest and most convenient means of receiving a product. Since ecommerce demand is increasing, the ability to use existing physical resources and locations to meet demand will define ecommerce shipping strategies.
For shippers, this may require the integration of platforms and continued shipments of products to brick-and-mortar locations. As with over-the-road transportation modes, taking advantage of resources, like a transportation management system (TMS), freight consolidation programs and value-added services, such as invoice auditing, can keep freight spend in check. The same concept applies to ecommerce shipping practices.
The best ecommerce shipping practices rely on a strong logistics foundation, including the technologies that have propelled logistics into an era of unprecedented efficiency and cost-effectivity. Instead of risking ecommerce success with haphazard ecommerce shipping practices, shippers should continue to use both traditional and innovative best practices to manage logistics and get more product to consumers within the Holy Trinity of Shipping.
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