Imagine ordering online and your order unexpectedly takes a while before arriving. You follow up with the platform’s customer service just to be answered with “Your package is already with our 3rd party logistics for delivery”. And every time you call, you always get the same answer. Frustrating isn’t it? Don’t worry, you, as the customer isn’t the only getting annoyed. The e-commerce platform is, too.
Just with this situation, you already know how important an effective logistic partner is in today’s world. With a lot of the world’s population making transactions online, you can only imagine how many orders arrive at every platform’s doorstep. As someone who is part of the e-commerce industry, you should know how logistics companies can make or break your online platform.
Advantages of Effective Logistics to E-Commerce
1. Visibility of Stocks and Items
The first advantage starts with visibility of stocks and items. In e-commerce’s point of view, an effective logistics company can serve as their eyes to the stock levels of each and every SKU they have. With this, an e-commerce company can determine whether or not to replenish certain items. Ideally, the logistics company will give them weekly or monthly reports that show the stocking levels of every item. Some companies can even do these reports in real time.
Want free money?
Visibility of stocks isn’t only beneficial to replenishment. It’s also important in accounting for the current inventory you have on hand. This will give you an idea if you have a lean inventory or a lot of sitting capital in your warehouse.
2. Efficient Picking and Packing
Second, a logistics company can do the picking and packing themselves. Once orders are confirmed, these will be routed to the warehouse and logistics can start picking and packing your order.
An efficient and thorough logistics company can minimize the wrong orders that are sent to your customers. If a logistics company fails to do this, more customers will complain which will eventually lead to a decline in sales for an e-commerce platform. To add to that, constantly having wrong orders will make a dent on your financials because of the extra costs for delivery and handling.
3. 100% Order Fulfilment
If you have an effective logistics partner, then you can achieve 100% order fulfillment. This means that you won’t have any backlogs. Backlogs refer to delayed orders that have not been shipped. The fewer backlogs you have, the better for your customers and your supply chain.
And it’s not just the order fulfillment that benefits your company. When your logistics partner is set to deliver at the earliest possible time, you can achieve a faster lead time. This will always look good on consumers because they know that you can be trusted.
4. Tracking of Delivery Items
Another benefit is the visibility of the packages’ status. On the consumer level, an effective logistics partner allows them to see where their orders are from order confirmation to delivery. On the e-commerce company’s end, they will be able to answer any inquiries their consumers have regarding the movement of the package.
Moreover, if there is an inventory management system in place, the e-commerce company does not have to constantly follow up or ask logistics where the orders are. This lessens the amount of time you spend on calling. Although communication is always a good thing, there are more efficient ways of doing it that don’t involve calling the logistics partner for updates on each and every order.
5. Proper Handling of Reverse Logistics
It’s not just fulfilling orders that logistics can do. In fact, good logistics should also have a streamlined process for reverse logistics. This means they should be able to accommodate in a hassle-free way the return and exchange of items. Although for starting e-commerce platforms, most purchases cannot be refunded or returned, moving forward this should not be the case.
Allowing the return and exchange of items is an added bonus for your company. When consumers know that they have a means of refunding their orders, they will have more reason to use your e-commerce business.
6. Ease of Communication with Clients
Last but definitely not least is the ease of communication. In today’s world, it’s important for both the e-commerce company and the logistics party to communicate effectively. Without this, there will be a lot of misunderstanding regarding inventory, orders, lead time, etc.
Communication is an often-overlooked part of any business. But without an effective means for communication, an e-commerce company can fail. This is because consumers these days expect visibility of their orders and great customer service. There are companies that have a disconnect between their customer service and partner logistics.
In today’s world, a reliable and efficient logistics partner shapes the way e-commerce is evolving. Based on these 6 advantages, you can already understand how important logistics is for this industry. Without it, businesses can fail and customer trust will dwindle. So if you are looking for a logistics partner, you could use these advantages as your checklist to consider. In this way, you can thoroughly assess which logistics partner will be the perfect fit for your business needs.