Most online retailers don’t have the size and scale to operate their own fulfillment and delivery services. That means they have to deal with an outside provider, and asking the right questions can make all the difference.
Inquiring about a potential vendor’s technology and locations are two key components when deciding on fulfillment and delivery options, says Brad Wolansky, senior omnichannel consultant at B2C Partners retail consultancy, who will present during the session “10 Questions to Ask Your Outsourced Fulfillment Provider.”
E-commerce merchants aren’t experts about the technology that third-party logistics operators use, but they need to know their provider has “a bulletproof tech stack,” which means it has backup systems so that, for example, pick and pack operations don’t come to a standstill in case of an outage, especially during peak times, Wolansky says.
E-retailers also should ensure their fulfillment and delivery operations are located strategically to reach customers in the most efficient way possible. “Several areas have developed as peak locations for 3PLs: Ohio, Pennsylvania and Kentucky among them. Once, labor was plentiful. Now they’re all competing for everyone else’s folks,” he says. As a result, retailers need to ask for details to ensure their volume is handled quickly and customers aren’t disappointed.
One of the biggest blind spots for online retailers is not planning enough for peak distribution around the holidays, Wolansky says. If a merchant only considers the peak to be the final two weeks of November and the last two weeks of December, it can set that seller up for some potentially big problems, he says.
“The season has shortened so much in terms of how long you have to get products out the door Wolansky says. If you fall behind during peak, it becomes very hard to recover in time for Dec. 25.”
Retailers must look at the data they have about their supply chain and consider what is best for the business and customers says Willis Weirich, vice president, logistics, Neiman Marcus Group. For example, many retailers with store locations see fellow omnichannel merchants implement ship-from-store policies, but that should not elicit an automatic response of “we must ship from store too,” says Weirich, who is scheduled to speak during the session “How Getting the Heavy Lifting Right Can Improve the Bottom Line.”
“At Neiman Marcus, not all of our stores have the space to pick, process and ship orders,” he says. “We have a completely different business model than a big-box retailer. Sometimes it’s easy for retailers to come up with solutions, but we don’t ask what problem we’re trying to solve.”
“The Art & Science of Carrier Pricing: How You Can Get the Most Out of Your Delivery Service” session features Kenneth Moyer, vice president, supply chain strategies at LJM Consultants. It aims to help e-retailers “think like a carrier” as they navigate delivery services from the major carriers—UPS Inc., FedEx Corp. and the U.S. Postal Service—as well as regional carriers.
- “How Getting the Heavy Lifting Right Can Improve the Bottom Line, ” 10:30-11:00 a.m., Wednesday, June 7.
- “10 Questions to Ask Your Outsourced Fulfillment Provider,” 11-11:30 a.m., Wednesday, June 7.
- “The Art & Science of Carrier Pricing: How You Can Get the Most Out of Your Delivery Service,” 1:45-2:15 p.m., Wednesday, June 7.