The path to perfect implementation of a new e-commerce shipping strategy is not always clear, and it comes with several challenges that can undermine the efficacy and cost-effectiveness of e-commerce. Shippers need to understand these challenges, the characteristics of an e-commerce shipping strategy and a few best practices to overcome such issues.
Primary Challenges in an E-Commerce Shipping Strategy
Developing an e-commerce shipping strategy is about more than just considering e-commerce; e-commerce may include the omnichannel purchases in which customers use a variety of online and in-store devices and experiences to make a final decision and complete a purchase. Therefore, the challenges in an e-commerce shipping strategy derive from the need to consider both e-commerce and brick-and-mortar retail as it relates to omnichannel. According to Nathan Resnick via Shopify, some of the top challenges in implementing an e-commerce shipping strategy include:
- Poor inventory visibility.
- Channel-specific processes.
- Delays in order fulfillment and delivery.
- Troublesome returns management.
- International trade and customs issues reports Toby Gooley of DC Velocity.
- Increased risk.
Characteristics of a Winning E-Commerce Shipping Strategy
According to Inbound Logistics, creating the shipping strategy necessary to facilitate e-commerce will require re-evaluation of existing processes and the use of technology to maintain control over freight spend. This may include the use of artificial intelligence, machine learning, and predictive analytics to maximize value. Ultimately, a winning e-commerce shipping strategy utilizes technology in all stages of the supply chain, from manufacturing to returns management to ensure freight spend stays within reason.
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Best Practices to Reduce Challenges in Developing an E-Commerce Shipping Strategy
The challenges of e-commerce shipping can make it seem impossible, but shippers can leverage existing technology and the resources of others to minimize disruptions when implementing a new strategy. Some effective best practices for implementing a successful e-commerce shipping strategic include:
- Determine actual business needs, explains Dozens of potential e-commerce business solutions exist, and there is not a one-size-fits-all approach to selecting the right system. As a result, shippers should determine the actual business needs and how the benefits of a given system will increase brand value and reduce logistics costs.
- Minimize product packaging costs and add-ons. The wrong type of product packaging and add-on services can dramatically increase e-commerce shipping costs, and while customized packaging may be ideal for brand building, it is important shippers consider it when selecting a system. Shippers should minimize product packaging dimensions and avoid packaging that does not add value.
- Estimate product weight. Maintaining an updated list of the product weight is an essential step in ensuring all e-commerce shipments are quoted and shipped appropriately. Furthermore, failure to maintain an accurate wait for products and shipments will result in additional service charges by carriers, increasing e-commerce logistics costs.
- Determine e-commerce shipping costs and pricing models. Similar to maintaining an eye on product weight, shippers should also determine their average e-commerce shipping costs and pricing models before selecting a system. For shippers using carriers that have enacted dimensional pricing models, including UPS and FedEx, it is important to determine the exact shipping costs and prices models used before making a selection, which allows shippers to estimate the return for implementing a new shipping strategy.
- Review available freight consolidation programs. Shippers can maximize e-commerce shipping value by taking advantage of Intermodal shipping options and freight consolidation programs, but shippers must also ensure that a new system for managing e-commerce shipping can handle these needs.
- Research supply chain options. Since multiple supply chain and shipping options exist for handling e-commerce freight and brick-and-mortar freight, as well as the combined, omnichannel supply chain shipping needs, shippers should thoroughly review all available supply chain options before making a decision. This may include the expansion of shipment strategy to include freight consolidation, Intermodal shipping, optimized services, auditing, and more.
- Integrate your platform with shipping systems. This is the most important step to adding strategic value to e-commerce shipping. If an e-commerce shipping platform cannot integrate with your existing systems, it will lead to added costs and reduced returns. Furthermore, selecting a shipping platform may be made easier by looking for platforms that integrate seamlessly with existing e-commerce solutions, such as the new e-commerce LTL solutions offered by Cerasis.
Putting It All Together
The best-laid plans for implementing an e-commerce shipping strategy will falter without understanding the challenges inherent in e-commerce. E-commerce freight is rapidly taking up a larger share of available capacity across all modes of transportation. Shippers need to understand these challenges, recognize the characteristics of a winning e-commerce strategy and follow the best practices to reduce challenges when implementing a strategy.