Within e-commerce, unpredictability is a constant factor. Flexibility in the supply chain, therefore, becomes critical. This can be derived from implementing the right software and automated systems that can support the fluidity that e-commerce requires.
The flowering of e-commerce—while welcomed by most manufacturers and distributors/retailers—has introduced far more risk and complexity for logistics managers. Determining the optimal distribution network has never been more of a challenge, as shippers strive to strike a delicate balance between service and cost.
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“Any provider that establishes a strong reputation in e-commerce logistics and finds a formula which yields a consistently decent margin is set for years of success,” says David Buckby, and economist with the London-based consultancy Transport Intelligence [Ti].
Logistics is the backbone of all manufacturers’ & distributors’ success. In traditional supply chains, the movement of goods is very slow, more inventory is distributed in the supply chain and the operating cost of the facilities is exorbitant.
Due to manual processes at each stage of the supply chain is dependent on people rather than machines. The efficiency is decreased due to human errors increasing the time and resources required in the supply chain.
Traditional logistics is a memoir of the past which cannot survive in a digital age of technology and automation.
Forrester Research predicts that by 2017, e-commerce sales will reach $270 billion, an increase from 8% to 10% of all U.S. retail sales. One of the main reasons behind the success of e-commerce is logistics.
Fueled by technology and consumer preference, modern logistics empowers quick deliveries from the supplier to the warehouse and from the warehouse to the customers.
In our next installment of this 2 part e-book series, we will cover the benefits of expanding (not replacing) a manufacturers’ & distributors’ traditional business model to e-commerce as well as how you may execute a sound e-commerce logistics program.