Why ECommerce Fulfillment is Critical for Online Sellers!

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Ecommerce Fulfillment is Critical article and permission to publish here provided by Nikitha Kanumuri.

Technological advancements have made our lives more convenient. Different sectors of the economy have benefited from novel innovations; however, businesses can be considered as the biggest winners. From manufacturers to retailers, technology has greatly improved the efficiency and operations of these sectors. The emergence of ecommerce redefined how entities and their customers relate. Today, the ecommerce sector has made it easier for people to purchase their desired products hassle-free. 

The introduction of ecommerce fulfillment centers has made it easier for traders to outsource warehouse facilities and shipping services, thus making their operations much more manageable. It relieves the pressure of operating and managing the physical storage spaces. All the seller needs to do is outsource fulfillment services and the chosen company will handle the shipping and returns. 

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The Future of E-Commerce! (Infographic)

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Future of E-Commerce article created for Supply Chain Game Changer by Josh Wardini.  Infographic originally published by Subscriptionly at https://subscriptionly.net

Thanks to digital technology we can carry out commercial transactions online. We can buy and sell items or services, pay bills, make orders, and so much more.

Online enterprises are heavily relying on this commodity. This is why we have numerous online businesses nowadays.

The infographic below from Subscriptionly will inform you about the current and future tech trends that will influence the ecommerce sector. Some of the main trends are as follows.

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Which is Better? Amazon FBA or 3PL?

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Amazon FBA article by Dona Dimaculangan of 3P Logistics at https://www.3p-logistics.co.uk/.

E-commerce is defined as the buying and selling of products or services exclusively through electronic channels. If you’ve made an online purchase through eBay, Shopify, Amazon, and other platforms, then you have made your purchase via an e-commerce site.  More and more people spend their time browsing on the internet and the more likely they are to buy stuff online.

Admittedly, the e-commerce industry is booming. Retail e-commerce sales in the United States are projected to grow at a fast pace in the coming years, going from 322.17 billion U.S. dollars in 2016 to just over 485 billion US dollars in 2021.

Why You Need Order Fulfillment Services

 If you’re looking for a business that will eventually get you out of your 9-5 job, or looking to expand your existing business, having an online presence and web-based store could fulfill this goal. For beginners in the e-commerce trade, what do you need to do to get more sales, with a lot of online businesses competing for customers’ attention?

Amazon

Customers want products that will give the best bang for their buck with speedy delivery, and good after-sales support. Here’s where the different companies offering order fulfillment services come in.

What is an Order Fulfillment Service?

 Order fulfillment is defined as the steps involved in receiving, processing and delivering orders to end customers. A fulfillment service is defined as a third-party company that provides these order fulfillment steps on behalf of another party, such as an online seller.

Let’s look at the pros and cons of using either Amazon FBA (Fulfillment By Amazon) or a 3PL for your fulfillment needs.

Fulfillment By Amazon

 FBA, or Fulfillment By Amazon is a business model wherein e-commerce sellers on the Amazon Marketplace, big or small, can have their products stored in any of Amazon’s giant warehouses, pack and deliver them to customers, handle customer support, and returns.

FBA Pros
Expertise and Reach

 Amazon has one of the most advanced e-commerce fulfillment service in the world, can help you scale-up or grow your business and as of the last measured period, the source estimated 90 million paying Amazon Prime subscribers in the United States, up from 63 million in June during the previous year.

Amazon Prime customers are eligible for 2-Day Shipping, Free Shipping and other benefits. If you sign up your products for Amazon Prime, your products are eligible for free shipping, too.

Customer Service and Returns

FBA handles customer service and returns. Listings are displayed with the Prime logo, so customers know that Amazon handles packing, delivery, customer service, and returns.

They handle the fulfillment services side of the business and saves your time, so you can focus on the other aspects of your business.

Multi-Channel Fulfillment

With Multi-Channel Fulfillment, you can fulfill orders from other sales channels using your inventory stored in Amazon order fulfillment centers. Single-source your inventory to streamline your fulfillment operations, manage your inventory through an online user interface and can direct Amazon to return your inventory in e-commerce fulfillment centers at any time.

Cons of using FBA
Customization

Little to no order customization. Sellers must comply with existing Amazon .processes.

Branding

Items are shipped in Amazon boxes. Sellers can ship in generic boxes which may cost extra.

Warehouse Pricing

Storage fees are generally higher compared to 3PLs and usually rise during holidays.

Higher order handling fees for non-Amazon orders.

Communication

Solutions are based in standard processes which may pose little opportunity for dialogue.

Conflict of interest

The fact that Amazon may actually be a competitor to the seller. Amazon is in the business of selling, they just happen to offer shipping services. For Amazon, it’s free product and market research, and they’re making money off you.

Third Party Logistics (3PL / TPL)

Third–party logistics in logistics and supply chain management is a company’s use of third party businesses to outsource elements of the company’s order fulfillment services.

Pros of Using 3PL
Customization

Boxes/bags and all internal packaging are customized to a specific brand. Processes are adapted to your business’ operation and specification.

Warehouse Costing

Attractive storage costs that is variable. Customer pays storage space on a given month. Some 3PLs even offer free warehouse storage for a limited time.

Communication

Has onboarding processes, frequent communication before and after product launch. Collaborative approach is encouraged.

B2B (Business to Business)

Certain 3PLs can handle both B2B and B2C (Business to Consumer) fulfillment, resulting in one e-commerce fulfillment partner for all sales channels.

Cons of Using 3PL
Finding a Trustworthy 3PL company takes time.

Not all 3PL providers are created equal. It takes time to find a good company to work with from the beginning. Once you find someone you can trust, you can rest assured that your goods are being properly cared for. The initial search could be stressful but it will all be worth it once you find a reliable 3PL company.

Bad Service Reflects on Your Company

An inefficient 3PL provider could make your company look bad. Your customers do not care who is in charge of getting the product to them. All they care about is the end result. It is very important to look for a good distribution center early on to avoid customer-satisfaction issues in the future.

Amazon FBA or 3PL in Conclusion

Order Fulfillment Services are a crucial part of your business and a major factor in determining its success or failure. Whether you entrust your fulfillment services to FBA or a 3PL, there is a greater chance that you will be in good hands – these are fulfillment experts, after all.  The key difference is you as the owner,  – what do you want for your brand and what kind of customer experience you want to give to your consumers.

If you are happy to use Amazon’s existing system and tap into their wide customer reach, FBA may be a perfect fit for your company.  If, however, you would like more control over your order fulfillment services, partnering with a 3PL could be the best solution. Make sure your order fulfillment service provider is experienced with the type of operations you need before you entrust them with your reputation.

Originally written for Supply Chain Game Changer and published on March 8, 2018.

Seasoned Leadership in Action™! An Interview with Paul Kretz, Head of SCM at Church & Dwight!

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Paul Kretz
Paul Kretz, SCM at Church & Dwight

At Supply Chain Game Changer we believe in sharing experiences and expertise from people in every industry and from across the globe.  As such we have introduced our “Seasoned Leadership in Action™” Interview series at Supply Chain Game Changer.  This interview is with Paul Kretz, Head of SCM at Church and Dwight.

I first met Paul at Celestica.  He left to purse other interests but our paths crossed again later on.  I was at a company that had just implemented a new WMS system in the Distribution Centre.  The system cutover  was a disaster.  And the operation had been run without true Warehouse Management experience as well.  As I looked to recruit a new leader I was looking for a someone who could lead change.

I toured my final two candidates through the Distribution Centre, including Paul.  Their reactions would help me decide who to select.  The other person seemed overwhelmed and lost while looking at the mess in the warehouse.  It wasn’t clear what they would do.  Paul looked at the disastrous situation like a kid in a candy store.  He saw opportunity at every turn.  And instead of  being intimidated by the situation Paul was motivated and inspired.  I found my leader!

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6 Ways a Warehouse Management System Boosts ECommerce ROI!

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ECommerce ROI article and permission to publish here provided by Claire Glassman.

Warehouses play a significant role in businesses that offer goods and products. Whether you have a physical or online store, they’re important since they hold these products and house your inventories.

Since they are beneficial in your business, it is only important that you have an efficient system in place. That’s where a warehouse management system (WMS) comes in.

An effective WMS can significantly improve the efficiency of your business’s daily operations and optimize your warehouse’s overall function, as well as your ECommerce ROI.

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Complexity in the Retail Supply Chain!

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As consumers the complexity in the retail supply chain is usually oblivious to us. We go to the store and pick up the goods that we want. Or we order goods online from our devices at home, in the office, or anywhere for that matter. We consume the items, returning them if necessary, unaware of all of the work that went into making those goods available to us.

A phenomenal amount of activity goes on behind the scenes to make this experience as seamless as possible. I am not saying that it always goes smoothly. Sometimes items are broken. They are late. Or there is some other issue.

But behind the curtain that is Retail there are a lot of people managing a lot of processes and dealing with a lot of complexity earnestly trying to make your goods available to you.

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Consolidate Orders Online and Stop the Senseless Waste Now!

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During the pandemic more people have been shopping online than ever before. It stands to reason that with lockdowns in place and many physical stores being closed, that ECommerce ordering and shipping is a great alternative to face to face shopping. And customers typically except sellers to consolidate orders they place.

Along with online shopping the never ending push for fast delivery has continued unabated, whether it’s really necessary or not.

The result of this however is that more and more online orders are being fulfilled and delivered piecemeal. An order of 3 or more items more often than not results in the delivery of 3 separate packages. There is no focus to consolidate orders at all. It’s insane.

Unless there is an urgent need for a specific item companies should be consolidating their items in fewer packages and avoiding all of this waste.

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5 E-Commerce Order Fulfillment Choices! (Infographic)

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E-Commerce order fulfillment article by Dona Dimaculangan of 3P Logistics at  https://www.3p-logistics.co.uk/.

Businesses have long since entered the E-Commerce marketplace. But how do you physically fulfill all of those online orders?

The age of technology and innovation has made E-Commerce order fulfillment business processes and solutions so readily available that it has become highly competitive.   This competition is especially apparent in the area of E-Commerce  Third-Party Logistics (3PLs).

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Supply Chain Predictions!

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Predictions article originally published by, and permission to publish here provided by,  Kuebix at https://www.kuebix.com

In the book, The Living Supply Chain, the authors argue that, “Speeding up the supply chain is at the root of everything that is good: improved revenue, reduced working capital, higher profitability, and less obsolete inventory. Conversely, slowing down the supply chain is at the root of everything that is bad: working capital write-offs, reduced profitability, and slowing revenues.”

To “speed” up the supply chain is to invest in change and change will come with the digital transformation of the supply chain, which is the major focus for executives in the future.

Much change in the supply chain industry will be due to innovative technologies for digital transformations, along with the recent tax reforms, and the still-current driver shortage/capacity crunch. Digital transformation of the supply chain will change everything – for the better.

Supply Chain predictions

These are the innovative technology predictions companies must use to undergo this transformation within their supply chains:

Cloud-based technology deployments lower cost of ownership due to not having a large capital expenditure on hardware and upgrades. Cloud-based solutions are ideal for any size business because they can be scaled up as your business grows and are easier to set-up and manage.

Advanced Analytics will support real-time decision making based on data captured across the supply chain. With analytics, businesses can more effectively predict and fill demand. You can also manage relationships with carriers, suppliers and customers while improving processes. Using advanced analytics in a transportation management network to look at historical traffic patterns, you can plan a truck’s route that takes into account time delays for more accurate arrival times.

Tracking and Tracing of raw materials through manufacturing to the end customer must take on Amazon-like capabilities, meaning customers will know where their orders are at any one time, just like when you order from Amazon. With track & trace, you will get deep visibility to SKU-level information from first-mile to last-mile, including the tracking of costs to better monitor transport spend. Communications with customers will be proactive instead of reactive, alerting customers if their order will be late or when it will arrive.

Supply Chain Visibility will make data collected from end-to-end across the supply chain available to all stakeholders, giving them greater control and visibility into what is happening across the enterprise. You can uncover roadblocks within your supply chain that could lead to delays in shipping.

 

Blockchain will provide interconnectivity between ledgers of supply chain trading partners, enhancing traceability of transaction history. Automating the flow of information among trading partners provides transparency and boosts efficiencies. Blockchain works with cryptocurrency to determine payment amounts, allowing drivers to be paid as they complete parts of their journey. This completely removes the transport broker from the equation, giving drivers access to quicker settlement. However, blockchain is still a technology that needs further development before it can be proved useful to some businesses.

Artificial Intelligence initiatives require specialists who are hard to find, potentially stalling any projects. AI utilizes algorithms to detect patterns in vast volumes of data and interpret their meaning such as predicting whether a carrier will be on-time based on weather conditions and past performance.

Predictive Analytics, often combined with Artificial Intelligence, helps shippers understand, automate and optimize their supply chain processes to gain better efficiencies. Predictive analytics provides shippers with actionable intelligence and predictions to guide the decision-making process, helping you to reduce costs and optimize operations. Scorecards on carrier performance can alert shippers on which carriers can better meet their service obligations.

The Internet of Things (IoT)– More devices, from pallets to trucks will have sensors embedded to transmit status and performance data. This real-time information will be used for monitoring everything from equipment health to asset locations to order tracking and more. Advanced analytical systems use the data to uncover trends that lead to predictions and performance improvements and cost reductions.

 

Originally published on Supply Chain Game Changer on March 14, 2018.

Last Mile Delivery: Stop Shipping Air and Empty Boxes!

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When you order something Online there is great excitement in anticipation of opening your package when it arrives.  With any luck the company you have ordered from has provided a positive experience in the online ordering and payment process.  Now you are just waiting for the package to arrive.  You certainly don’t want them to stop shipping.

Most recently we ordered a couple of items online.  They were relatively small items and could easily fit in the palm of your hand.  Within a couple of days a large box arrived at the front door.   I wasn’t quite sure what it was because the box was rather big, big enough for a toaster or perhaps a couple of large board games.

I was surprised when we opened the big box, removed a bunch of crumpled paper and packaging material, and found the 2 small items we had ordered sitting on the bottom of this box.  The items could have fit inside a standard envelope.  Instead they were deliberately packaged in a box which could have held 200-300 of the items.  Why don’t they stop shipping air?

What a waste!

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Top ECommerce Order Fulfillment Challenges!

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Order fulfillment challenges article and permission to publish here provided by Catherine Park.

If you run an online business, you definitely know that managing it involves many moving parts. Ecommerce order fulfillment is among these moving parts that most eCommerce retailers overlook. Your profitability, customer experience, and overall business growth suffer without effective fulfillment.

Interestingly, despite simplified order fulfillment, most online store owners still struggle with several challenges.

Outlined below are common fulfillment obstacles faced by online businesses and their solutions.

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6 Major Delivery Logistics Trends!

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Delivery logistics trends article originally published by, and permission to publish provided by, Raanan Cohen at https://www.bringg.com/  

2017 was an important year for delivery logistics. With ecommerce sales reaching $23 trillion in annual sales worldwide, customers are relying on better and faster deliveries for all sort of goods and services.

But this evolution in the supply chain, and for last mile fulfillment in particular, doesn’t end with retail. From restaurant chains to supermarkets to pharmacies to service providers, the world of logistics is experiencing unprecedented change.  What are the delivery logistics trends?

 

This radical shift in customer behavior and expectations regarding deliveries means that many organizations will have to remake their entire supply chain in order to become more agile, and remain competitive in a world where an optimized, lean and efficient logistical infrastructure is at the core of a successful customer-centric business.

These are some of the key industry delivery logistics trends in supply chain management which will take center stage in the upcoming year:

1.  Real-time Visibility

We’re moving towards a supply chain which is fully transparent and trackable in real-time. On the one hand, it’s helping companies become more efficient by knowing the precise status of each order, driver and customer. On the other hand, customers are always aware of the status of their purchase and have the ability to interact with their driver directly if need be.

 

But transparency can go far beyond efficiency, comfort and value. Customers are increasingly demanding and worried about the supply chain behind their purchases. As Andrew Marder points out, the definition of transparency is expanding, with customers increasingly aware of factors such as worker rights issues, environmental impact, and even political affiliations.

 

 

2. Big Data

From the millions of data points and variables in any supply chain should come the knowledge required to determine business strategies and to support decision-making processes. And the puzzle isn’t getting any simpler, with companies deploying different tech platforms and using multiple fleets and 3PLs throughout their supply chain.

In addition, there is the data collected at customer touch points, from feedback on the delivery to driver ratings. All this information needs to be processed and analyzed since the “brand experience” doesn’t only apply to brick and mortar establishments anymore – and companies are increasingly coming to realize that the delivery process is a powerful catalyst to improving or swaying brand perceptions.

In the context of the supply chain for most businesses, big data and predictive analytics are still an untapped resource that can potentially provide insights which help anticipate or respond to events or disruptions. Unpredictable consumer behaviour, traffic or weather patterns, and labour unrest are all external events that can disrupt a supply chain and lead to increased costs and customer service challenges.

Delivery Logistics trends

Big data can help organisations become better trading partners to their customers and suppliers. But before insights and analytics can be leveraged for a better supply chain, there’s a huge task at hand for the many organizations that need to first collate data points from all sources and align them to their business operations.

3. Sharing Economy

Sharing economy solutions will soon begin disrupting logistics services. We’re already seeing how Uber and other companies setup driver networks to deliver packages to consumers by using their personal vehicles. To cope with the shortage of drivers and with the need for flexible fleets that are available based on business demand, the sharing economy will begin spreading in 2018 into big brands that need to find alternatives that help them create a more flexible and adaptable logistics infrastructure.

This trend can take different shapes and forms. For example, earlier this summer WalMart piloted a scheme in which some of their store staff could earn extra cash by delivering packages to customers on their drive back home. Other companies are looking into different solutions that would enable them to share resources and fleets in order to become more efficient – for instance, a restaurant fleet with spare time after lunch rush hour could potentially help a retailer struggling to meet demand during the peak holiday season.

 

4. Conquering the Last Mile

Amazon has changed the way we buy things. If retailers don’t offer two-day or overnight shipping, shoppers will likely go elsewhere. This is putting an unprecedented level of pressure on the entire ecosystem, and what used to be a challenge for retailers is now something that many other industries need to take into consideration. As Business Insider said, it will be about Amazon versus the World following their acquisition of Whole Foods.

The last mile challenge isn’t only about logistics feasibility and speed, but also about the strain that the now de facto delivery alternatives put on profit margins. That’s why businesses will need to get creative when it comes to finding new ways to pull together their resources and fleets in order to build new supply chain models that help them conquer the last mile and win their share of customer wallets.

 
 
 

5. Orchestrating Delivery Channels

While the spotlight right now is on the Last Mile, there’s a lot of room for growth, improvement and modernization throughout the entire supply chain – from the first mile to the last and everywhere in between. One of the biggest challenges for companies is that the last mile matrix is getting increasingly complex with all the different delivery channels.

In order to succeed, retailers will have to orchestrate their logistics matrix strategically, optimizing the use of all the delivery channels depending on their customers’ location, required level service, price, etc. To do this, they will have to increase their investment in technology – using the platforms and tools to seamlessly align and manage the entire jigsaw efficiently.

 

While in the past, the only decision businesses had to make was whether to use an in-house fleet or an outsourced delivery partner, the reality for many companies today is that they have to manage multiple 3PLs, fleets, and even crowd-sourced drivers. The current landscape will continue forcing businesses to be open to new ‘hybrid’ logistics models using a combination of delivery companies, technologies, and distribution partners to serve an increasingly demanding and global customer base.

 

retailers will have to orchestrate their logistics matrix strategically, optimizing the use of all the delivery channels

 

6. Openness to the unknown

The world is changing fast, and it is key to be able to rapidly react delivery logistics trends, industry changes and to new technologies that we might not even have heard of yet. So those companies that stay with their finger on the pulse and with an open mind when it comes to rethinking the way they work, will be the ones that succeed in the long run.

There was incessant press coverage in 2016 about drone deliveries. During 2017 the attention shifted towards self-driving cars and trucks. With the recent explosion of Bitcoin value and blockchain technologies, there is a lot of speculation and ideas about how to leverage blockchain protocol to improve supply chains.

 

I look forward to another year where reality often surpasses what not long ago felt like fiction – constantly creating new milestones and standards that move the entire ecosystem forward with groundbreaking innovation in technology, commerce and logistics.

 

Originally published on Supply Chain Game Changer on January 25, 2018.

Multichannel vs Omnichannel Fulfillment Solutions!

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Unchaining Change Leadership

“Omnichannel” is certainly the prevalent phrase in the E-Commerce arena.  The expectation in an Omnichannel Fulfillment world is that a customer can order what they want, when they want, on whatever device they want, and have it delivered how they want.

The physical delivery part of the Omnichannel expectation can be very elusive.  Many companies claim that they are Omnichannel service providers.  But are they really?

How many E-Commerce Fulfillment options are there?  And how many do you provide in your company?

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Our 2017 Top 10 Blog Posts … So Far!

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It’s been 6 months since we launched supplychaingamechanger.com.  Our goal has always been to share experiences and expertise.  The site has evolved.  The number of categories has continued to grow.  And the response has been absolutely tremendous. We can now present our 2017 Top 10 Blog posts.

In that time Supply Chain Game Changer was also selected by Feedspot as one of the Top 75 Supply Chain Blogs on the Internet.

So we thought that this would be a good point at which to share a list of the 2017 Top 10 Blog posts that we have published so far.  We would be remiss if we didn’t also thank the phenomenal Guest Bloggers who have given us such great content.

So here is the 2017 Top 10 Blog List, so far …

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EStore Order Fulfillment Acceleration Strategies

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EStore order fulfillment article and permission to publish here provided by Carl Torrence.

With the launch of Amazon’s Prime Membership back in 2005, the rules of the ecommerce game changed. Amazon Prime offered free two-day and cost-effective one-day/overnight delivery options; exclusive to their members.

According to a survey conducted by LaserShip, 63% of shoppers expect delivery of their orders within three days and the young shoppers are willing to pay a premium for this convenience.

Needless to say that retailers and ecommerce business owners are having a hard time keeping up with these demands. In fact, meeting customers’ demand for speedy deliveries is among the toughest challenges in the supply chain, as mentioned in MHI’s industry report.

Continue reading “EStore Order Fulfillment Acceleration Strategies”