Every company that does business online—which is almost every company in the modern economy—knows that e-commerce business models are growing and evolving faster every year.
More retail is becoming e-tail. More goods are moving from fulfillment centers straight to customers’ doorsteps without passing through brick-and-mortar stores. And customers expect all of this at lower prices than ever, if they don’t expect it to be free.
Is your company ready for another year of accelerating e-commerce demand?
E-Commerce Business Models Moving as Fast as Possible
As soon as an order hits, e-commerce retailers must be able to pull those packages from shelves. That requires keeping inventory levels on hand as well as designing efficient, well-organized warehouses that workers can easily navigate. Good software and technological integration can be a huge asset for fast-moving warehouses.
Then, those packages need to be shipped. Many e-commerce companies that are large enough, send multiple shipments each day. These might be for different service levels—one for same-day delivery, one for next-day air, one for two-day shipping—or based on carrier needs.
Finally, carriers need to deliver packages to customers as promised. While you can’t do much to change your carrier’s performance in real time, you can hold them accountable by claiming refunds for late deliveries.
If you’re struggling to accelerate order fulfillment, make sure your fulfillment centers are in optimal locations. The closer they are to customers, the less time packages take to ship and the less shipping costs usually.
Optimizing E-Commerce Sales and Cutting Your Costs
Amazon Prime didn’t only normalize fast shipping. In the last decade, customers have also come to expect free shipping so much that they may decide not to buy a product if they see an added charge for shipping.
But shipping isn’t getting any cheaper. So shippers have two levers to pull: building those costs into product prices, and reducing shipping costs as much as they can.
To increase efficiency, many shippers have turned to warehouse management systems or even on-demand warehousing. Though staffed warehouses are still the norm. On the cutting edge of these facilities, you’ll find optimization algorithms that maximize warehouse space, wearable technologies and apps that tell workers where to go to find their next items, and more.
In some cases, these result in near-fully automated warehouses, where software-controlled robots find items and deliver them to destinations. Replacing human employees with automated ones is an unpopular proposition, but for many companies it can turn out to be much cheaper and enhance their e-commerce logistics. Robots don’t get paid and can work for days on end without rest.
The Growth of E-Commerce, Technology and Artificial Intelligence
Warehouse technology isn’t the only part of the shipping industry that’s automating. Self-driving trucks, drones and robots all promise greater speed and accuracy at lower costs.
Self-driving trucks will probably be moving our packages within the next decade. Right now, trucking is a tough business. There aren’t enough truckers, which means some trucking companies have raised wages to attract more people and passed those costs onto shipping carriers. Fuel prices almost always rise over the long term. Plus, trucking is dangerous. This has lead to laws that require truckers to stop and sleep.
Self-driving trucks like automated warehouses, do not need wages or sleep. If a truck could move a package thousands of miles in a day—a distance currently covered by air because trucks are too slow—that could significantly expand the range of zones covered by ground shipping, making e-commerce shipments cheaper.
Drones shipping applications are not quite as well developed, but drones are showing promise in last-mile delivery in urban areas. Robots can now pick up and pack packages.
To take advantage of these new technologies, supply chain managers need to implement them strategically. That starts with knowing what makes the most sense for your company.
Shipping Intelligence is Imperative For E-Commerce Operations
Making wise, forward-looking decisions starts with having the right information. At Reveel, we call this “shipping intelligence”—a data-driven understanding of your consumers, e-commerce logistics, order trends, data analytics, inventory levels, geographic distribution, operational metrics and more. Monitoring packages as they come and go in real time can reveal exactly where your inefficiencies are within your e-commerce model.
Every technology isn’t right or necessary for every e-commerce experience. But those companies that can reduce inefficiencies with new technology can be beneficial. Focus on making those connections, and technological advancements that can enhance your ability to meet ever-changing e-commerce operations and demands.
E-commerce growth is not going anywhere. It’s not even slowing down. To even hope to succeed in the crowded online marketplace and e-commerce industry, merchants need to meet the day-to-day demands of order fulfillment—as fast and as cheaply as possible.
If you need help getting started with data collection, Reveel is here to help. Our expert consultants can show supply chain managers how to gather a wealth of information in real time. Then, we can help you draw conclusions from that data to improve your supply chain and e-commerce solutions in a targeted, maximally effective way. Let’s get started today.
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