We are reaching one of the fundamental peaks of the logistics sector for e-commerce, the famous Black Friday campaign, which has already established itself in our country as one of the main moments when many consumers take advantage to make many of their Christmas purchases and the significant discounts that many brands and stores apply to most of their products.
According to the estimates of the Business Organisation of Logistics and Transport (UNO), purchases of this year’s edition will account for around 50 million shipments, an increase of 30% compared to the previous year. But it is also increasingly clear that this commercial event can become the “Black Friday” of some brands and suppliers, due to not having the resources and capabilities to quickly and effectively scale the management of their e-commerce logistics.
Both brands and their logistics partners must in this annual milestone demonstrate the maximum efficiency, flexibility and ability to respond successfully to the predictable purchasing furore, precisely in an fiscal year strongly driving online sales. But it must be done with profitability, which is not always easy in today’s e-commerce environment, where lack of forecasting or a shortage of technical and human means can make this date a real “ordeal” for its results and profitability.
In addition, at times of maximum demand for delivery, costs are multiplied, which negatively affects the margins of all stakeholders involved in the commercial chain: brands, wholesalers, retailers and commercial channels.
The result is that not all operators can monetise this boom in online shopping and their logistics for e-commerce face a number of problems as a result, as a recent Business of Fashion article points out very well. In said article, its author stresses that, despite the increase in business due to the global pandemic, brands must deal with greater operational burdens that hurt their income statements.
As summarised in the article, e-commerce drives business. That is clear. But it is straining everyone involved, their margins and profits, and can become a pathway towards inefficiency, due to the poor preparation of conventional business models, designed mostly for physical and face-to-face sales.
And we are not just saying that any failure can result in the uprooting of this promising online market, due to the abandonment of dissatisfied customers. Because even without bulk errors in the logistics for e-commerce, being able to meet the expectations of customers can be unworkable for companies at the current time.
We all know that customer satisfaction depends on offering the highest quality, in the shortest amount of time possible and at the lowest price. But how to achieve this? And, more importantly, how to do it in a way that’s profitable for all market players?
Some key aspects
Specialists and logistics experts for e-commerce often find several key aspects to achieving effective and cost-effective online commerce: intelligent inventory management, product grouping and the incorporation of technologies that streamline stock and warehouse management, robust and scalable systems such as RFID, which allow for integration with the respective systems of suppliers and partners, greater control and monitoring of deliveries, or the streamlining of logistics processes, with centres or intermediate points for the exchange of goods, for example.
In general, tools are needed that provide visibility to the entire process, more agile management practices and innovative solutions that allow us to properly get ahead of demand. One seeks to reach a type of “liquid stock”, that is not focused on a single channel, but rather feeds all of them, to offer the consumer the possibility to choose the point of contact with the brand and the supplier to find a point of balance between demand and supply, but in a cost-effective way.
In this sense, and in response to this clear consumption trend that will get stronger in the future, it is recommended to have a strategic partner that has the facilities, resources and logistics technology necessary to cope with these increasingly demanding consumption peaks, but also one must be able to adjust to other valley periods or less commercial activity.
It is about adapting the logistics for e-commerce to the challenges of capacity, flexibility and efficiency as imposed by online commerce and the omnichannel customer,, with orders and deliveries which are increasingly more personalised, but without neglecting face-to-face purchasing which, in a few months, could recover.
A strategy that must be based on systems and technologies that manage not only deliveries, but the entire logistics process, from receipt of the material, preparation of orders and classification, management of goods in transmit and final distribution, as well as possible returns. The objective is to obtain total control and maximum efficiency, allow us to visualise the entire operation and ensure the traceability of each shipment, which will result in an effective delivery for the customer and more profitability for the supplier.
Anticipating the unpredictable nature of orders is also essential and past experience must guide future strategies, putting technology and people at the centre of our actions, but correctly reading of the needs and demands of the online customer, which are ever increasing and decisive in ensuring their future loyalty and, ultimately, commercial success.
