How Logistics Has the Biggest Factor in Ecommerce Sales Growth

How Logistics Has the Biggest Factor in Ecommerce Sales Growth

People today take to mobile devices and the internet for many of their economic activities. Most individuals would rather browse the internet, choose a product they can buy, purchase it, and wait in the comfort of their homes for their orders to be delivered. Hence, e-commerce platforms have to rethink their logistics strategy to meet the increasing demand of consumers for faster and more efficient delivery of ordered items. Such is the role of logistics in robust e-commerce sales.

Brief History of the System

In the 70s, wholesalers and suppliers restocked the inventory of the majority of retail stores. A decade after, retailers themselves realised the importance of centralisation. They knew that store deliveries are better managed if they had direct control of distribution centres. Another decade passed and the commercial landscape welcomed the introduction of global sourcing. By the 1990s, retailers already have import centres, allowing them to receive and process imported goods for marketing and distribution.

The New Era

With the new millennium, pure-play retailers began conquering the consumer-retailer landscape. This also paved the way for the establishment of electronic fulfilment distribution systems. Since then, the e-commerce industry has never looked back. They know that the logistics sector has their backs.

The modern e-commerce landscape is now defined by mega e-fulfilment centres. Logistics providers work with retailers in the transportation and stocking of merchandise at large facilities. These mega facilities do not have downtimes. They run 24/7, making sure that retailers are able to send ordered products to their waiting customers. Logistics providers have to work double-time to make sure there are no delays in the movement of goods. They know that consumers today expect fast and quality service.

Advent of Parcel Hubs and Sorting Centres

Aiding in the delivery of these goods are sorting centres and parcel hubs. They classify orders according to their destination, whether by postcode or by ZIP code. This eliminates the risk of having an ordered item delivered to the wrong parcel delivery centre. It also ensures that the package gets delivered to its designated collection point. From the mega e-fulfilment facility to parcel hubs, logistics companies bridge the gap by transporting parcels in a fast, efficient, and safe manner. It is one thing to get the product delivered fast; and the other is to deliver it safe and sound.

At the parcel delivery centres, each package gets processed one last time. After the thorough evaluation of the parcels, these are then sent via logistics partners for delivery to customers. While this segment of the e-commerce experience is the last mile, it is often one of the most challenging. Depending on the speed and efficiency of the logistics partner, the waiting customer can either be delighted or not.

Post-delivery Feedback

If the experience delights the customer, then he or she can provide invaluable feedback or review about the e-commerce retailer. The company can then use the information and post it on its website for other potential customers to see and read. This is one way e-retailers can perform marketing without spending a dime. The service that they provided already speaks for itself.

But this is not the only way the company can benefit from improved delivery of services. Satisfying the customer can lead him or her to share his or her positive experience on social media. They may describe the speed of the delivery, the convenience of the shopping experience, and the packaging and handling of the product. What they do not know is that the e-commerce retailer’s logistics partner has a lot to do with their pleasant online shopping experience.

The Importance of Communication in the Process

Logistics providers help increase e-commerce sales by improving the communication between and among the parties involved in a particular transaction. They also provide transparency in the ever-complex supply chain. Logistics companies reduce the cost that retailers have to shell out should they choose to handle the logistics part themselves.

Third party logistics providers also guarantee on-time delivery by improving the efficiency of their transportation network. They understand the importance of satisfying the customer’s expectations. All of these will spell better returns for the e-commerce company.

Logistics have always been an important partner in any business-related activity. With the growth of e-commerce, logistics solutions have to step up the game in an effort to keep up with the rapid pace of an e-commerce environment. To learn more about this, visit Effective Logistics website.

Tom Spiggle
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