The e-commerce landscape has experienced tremendous growth in recent years, with more and more consumers embracing the convenience of online shopping. Research shows that the number of online transactions and revenue generated from e-commerce continues to rise steadily. However, as economic distress and consumer caution affect purchasing behavior, e-commerce brands must rise to the occasion and improve their fulfillment capabilities to retain customers. Additionally, the importance of e-commerce shipping cannot be understated, as it can make or break the customer experience and serve as a differentiator in a highly competitive environment.
In this article, we will discuss six challenges that e-commerce brands commonly face in e-fulfillment and provide practical solutions to overcome them.
Lack of Inventory Visibility
Successful omnichannel retailing requires complete and accurate visibility into available inventory and its location. Brands that aim to keep their customers satisfied must avoid major inventory mishaps such as stockouts.
To overcome this challenge, it is crucial to invest in e-commerce technology that enables real-time visibility. Ensure that your warehousing platform seamlessly connects with your e-commerce order platform to understand the volume of inventory. Companies like Ryder offer advanced technology solutions that provide real-time inventory visibility, ensuring efficient order fulfillment processes.
Labor Shortages
Warehousing operations heavily rely on a capable workforce. While labor shortages may not be as challenging as they were at the onset of the pandemic, businesses still face the difficulty of recruiting and retaining employees. With remote work becoming the new normal, associates may prefer not to work in-person at warehouses.
To overcome this challenge, consider partnering with a third-party logistics provider (3PL) that has established relationships with employment agencies and expertise in flexing up or down according to seasonality and volume. Additionally, develop an employee retention strategy that includes continued education, training, growth opportunities, regular reviews, and incentives for positive performance. Offering more flexible working hours can also attract and retain talent.
High Expectations from Customers
Customers now expect faster package delivery times, along with personalized experiences at every touchpoint. To exceed these expectations, e-commerce brands need to revamp their processes and ensure their tech-stack is up-to-date.
Overcoming this challenge involves partnering with a 3PL that can optimize the e-fulfillment process. Look for a provider that has relationships and negotiated rates with carriers, as well as advanced technology for better insights and improved customer experiences.
High Shipping Costs
Shipping costs can be a significant challenge for e-commerce businesses, especially during peak seasons when carriers impose surcharges. Additionally, factors like inflation and General Rate Increases (GRI) can further increase shipping costs.
To overcome this challenge, diversify your parcel carriers to leverage competitive rates. Implement multinode fulfillment to position inventory closer to customers, reducing shipping distances. Set free shipping thresholds that encourage customers to spend more to qualify for free shipping, offsetting some of the costs.
Complex Reverse Logistics
Returns are an inevitable part of e-commerce, but a complex and inefficient reverse logistics process can negatively impact the bottom line and customer retention. For instance, if customers have to request return labels from support administrators instead of being able to self-service, it wastes time and energy for both the customer and the support team.
To overcome this challenge, look for a Warehouse Management System (WMS) that can integrate with top returns providers. Or work with a 3PL that can help you expand your ecosystem through partnerships with top providers. Offer self-service returns, where customers can initiate and track returns easily. Streamlining the return process will improve customer satisfaction and reduce costs.
Slow Shipping Speeds
Fast shipping is no longer a luxury; it has become an expectation for customers. Studies show that customers are more likely to leave a brand after a negative delivery experience.
To overcome this challenge, streamline and automate your order fulfillment processes. Integration between your e-commerce platform and WMS can expedite the preparation of packages for shipping. Additionally, work closely with parcel carriers to understand which partners can meet your shipping standards efficiently.
A solution for your future
Addressing these e-commerce fulfillment challenges proactively is vital for brands to remain profitable and provide stellar customer experiences. By investing in e-commerce technology, partnering with reliable 3PLs, optimizing processes, and leveraging advanced logistics solutions, e-commerce businesses can overcome these challenges and stay ahead in the competitive landscape. Remember, fixing these challenges before they occur will ensure a smoother fulfillment process and contribute to the overall success of your e-commerce fulfillment operations.
