Ecommerce has a reputation as being a relatively easy way for new businesses to start-up, or for existing businesses to expand their markets. But, even if you take advantage of options like the drop-ship model for inventory, e-commerce supply chain management is still crucial to the success of your e-commerce.
To help you understand why we’ve put together the following guide.
The Basics of Ecommerce Supply Chain Management
Managing your supply chain ensures that customers can get your products when they purchase online. You know what you went through to make the sale. So you don’t want the effort to go to waste because you didn’t properly manage the supply chain.
Inventory is the lifeblood of any product-based business. The key to managing your inventory is to have it on hand when customers buy, without having so much that your costs of managing it get too high. Clients expect products to be available. They also usually expect to receive them within a day or two of placing an order. That’s where the attractiveness of drop-ship models can fade. If your partner doesn’t deliver to your customers’ expectations, your business suffers.
2. Product Assembly
If your product requires any assembly or pre-assembly, it’s a step in your supply chain. It means tracking and managing raw materials, finished products and having the space to do it all. Too much or too little inventory can be crippling when you’re selling finished products. The problem is compounded when you have inventories of raw materials and finished products.
3. Picking & Packing
Similar to product assembly, multiple SKUs can add complexity to your supply chain. In addition to maintaining supply chains for different SKUs, you will need to fulfill orders for many SKUs. That doesn’t just mean space for all your SKUs. It also means you need to manage your space for efficient picking and packing of orders. Failing to do so will slow down your order fulfillment and increase costs due to lost or damaged goods.
4. Reverse Logistics
Whether B2B or B2C, your e-commerce customers are keen to find out about your return policies. To give you an idea of just how keen, studies show that you can expect an impact on your sales for anything less than free returns. The more streamlined your reverse supply chain is, the more successful your business will be.
Many e-commerce operations choose to simply rely on standard transportation options for shipping and receiving. That might work well until it suddenly stops working. Then you might need to find options when few are available due to unforeseen circumstances. Like a pandemic.
6. Supply Chain Consultants
At best, a mismanaged supply chain can be a hidden profit killer for your business. At worst, it can make it difficult for you to remain in business. The crucial nature of e-commerce supply chain management for the success of your business makes working with a specialized supply chain consultant, like PiVAL, make a lot of sense.
Learn more about supply chains in our article “PiVAL Offers Supply-Chain Insights in Globe & Mail Article“.
What challenges are you currently facing that are disrupting your supply chain, ultimately impacting how you service your customers? My team and I are ready to help you optimize your supply chain. Contact me today to discuss how we can support your growth.