Surviving this year’s online holiday shopping tsunami: SMEs need to outsource e-commerce
The surge in online shopping is prompting many businesses to outsource their picking, packing and shipping activities in order to save money, achieve operational efficiencies and improve the customer experience.
According to Mal Siriwardhane, the Managing Director of leading e-commerce enabler and third-party logistics provider, B dynamic Logistics, businesses need to take care when choosing the right logistics partner as fit, flexibility and capability are the most important aspects of any logistics service.
Mal Siriwardhane says many retailers will fail miserably this festive season due to staff shortages, poor systems and transport issues – leaving customers in the lurch.
- Many retailers are still too under-staffed
- Many are relying on inefficient old manual dispatch systems for online shopping
- The surge in online orders will overwhelm many retailers
- Many retailers haven’t moved into the new era of third-party logistics
Mal states that retailers urgently need to prepare for this year’s festive season as online shopping is tipped to surge even higher this year.
“Outsourcing of picking, packing and shipping can reduce the costs to retailers by up to 80 percent. This is a huge saving. It also enables retailers to sell more and manage the whole process more efficiently.
“By doing this, retailers are able to operate more effectively, save money and offer a better shopping experience to their customers.”
Tips for SMEs on how to choose the right logistics provider:
References and business performance
“Do your homework and seek out references and information about your preferred third party logistics provider,” Siriwardhane said.
“Read the customer reviews to get a good idea of how well the company has built and maintained its customer relationships as well as logistics management. Explore how they address and resolve issues. Find out what their performance targets are like and their track record in meeting them.”
Scalability and adaptability
“The right provider understands the importance of creating a custom plan specific to your business needs and vision. As you grow and your needs change, your provider will be there to help accommodate your business’ expansion.
“Choose a provider that can handle both your current and your future volume of stock. Particularly if your industry experiences large fluctuations such as huge sales volumes over the holiday periods. Your provider needs to be able to cope with sudden surges or sales spikes. Service should never slip despite surges in demand.
Streamlined technological expertise
“Your chosen third-party logistics provider should help your business streamline your processes and automate tasks. You should always ask these two questions of your provider, firstly, how does their technology connect to your online store or existing software systems? And secondly, how will their software use your data optimally,” Sirwardhane explained
“Ideally, your chosen third-party logistics provider should have a cloud-based warehouse management system and electronic data interchange capabilities. Having a third party logistics provider that is at the forefront of technological innovation will help you with your inventory management and order tracking.
Safety culture
“When choosing a third party logistics provider a good safety record should be a priority. This will come into play if goods are ever stolen, or a carrier is involved in an accident that damages your stock. Safety of the stock is critical for you to store your products at a third party logistics provider’s warehouse. And safety of the staff and visitors is paramount in the logistics industry. A provider with a good safety culture will ensure all employees, visitors and their business partners are safe and customer goods are in safe hands.
Inventory management
“A good third party logistics provider will offer you an integrated warehouse management system. As an example, B dynamic Logistics’ proprietary Warehouse Management System platform provides customers with real-time visibility and traceability of orders, inventory and delivery tracking,” Siriwardhane said.
Location
“Many businesses start small and that’s ok. But whether you stay small is another thing entirely. Are you limiting your potential by operating out of just one region. With the right third party logistics partner, you could cast your nets much further and have access to more locations through a huge expansive network for fulfilment centers. This is especially important when you are selling your products to all parts of the country, or even overseas.”