2024.07.03
E-commerce: six reasons to outsource your logistics
e-Commerce has enjoyed unprecedented growth over recent years. But faced with the new challenges inherent to online sales, including stock management, order preparation or the processing of customer returns, many companies have found themselves tied up with the many different facets of e-commerce logistics.
To be able to better manage this aspect of their business, some of them are choosing to outsource their logistics. In doing so, they delegate various tasks to an outside service provider specialising in this field.
This enables them to continue growing their online business, building loyalty among their customers or reducing their costs. In this article, weʼll be explaining the main benefits of outsourcing the logistics for your e-commerce business.
Enabling you to concentrate on growing your business rather than on the logistical aspects
Firstly, outsourcing naturally allows you to focus on your core business and activities.
Subcontracting your logistics can save you a lot of time. You can use this time to improve your catalogue, promote your products and optimise your e-store…
It offers numerous benefits for small and medium-sized companies just starting out, (especially as they may not necessarily have the required infrastructure, such as a warehouse for their stock) and also for large companies keen to focus on their growth or on new projects, such as expanding their business internationally.
Improving the customer experience through effective order management
Building customer loyalty is a vital aspect of e-commerce. Itʼs a good way to expand your online store! However, as stated at the beginning this article, an influx of orders often goes hand-in-hand with difficulties in managing the logistical side of your operation.
You need to ensure that there are no stock level errors and above all avoid any stock-out incidents, ensuring products are always available to be dispatched.
You also need to manage orders correctly to ensure that they are fully compliant. This can help your business to stand out and be a valuable source of competitiveness. Improved customer satisfaction leads to greater customer loyalty. This can be achieved by handling customer returns effectively, rapidly fulfilling orders while at the same time personalising them as needed, or offering fast delivery by using an outside service provider, you can rightfully claim to ship 100% of orders received by midday on the same day, or to meet deadlines of less than 48 hours between the shipment and delivery of a parcel…
With a logistics service of this kind you can be assured of a happy customer base… On this point, did you know that an “on-time” delivery is one of the leading criteria for ensuring satisfaction among e-commerce customers? And that a satisfied customer is 60 to 70% likely to make another purchase from your website?
Optimising your costs
Outsourcing your logistics naturally entails additional costs. Perhaps youʼre wondering if it would be more profitable to manage everything in-house. But this can be a common fallacy.
We find two types of costs in the distribution sector. On the one hand there are the fixed costs, including the leasing or purchasing of your warehouse, energy consumption, insurance, maintenance and upkeep costs or those for IT equipment. On the other hand, there are the variable costs, including staff pay, transport, packaging materials and pallets.
Outsourcing your logistics offers a means of transforming your fixed costs into variable costs, enabling you to minimise the capital tied-up. In a world in which markets and economic situations can change very quickly, subcontracting offers greater flexibility, enabling you to optimise your costs.
In this way, you can take advantage of variable costs in the event of a fall or surge in your business activity, thanks to the use of a shared warehouse. This means you only pay for the storage you actually use if your stock level falls, thereby reducing your costs. Using an outside service provider therefore limits both your exposure to risk and the financial investment required.
Expand your business internationally, taking advantage of an extensive network of warehouses.
Logistical outsourcing also offers possibilities to grow your business, particularly in terms of geographical reach…
Have you already considered international deliveries? Because each country has its own rules and specific characteristics, which can often be a nightmare to navigate. To make the most of this untapped potential, delegating certain tasks to a professional logistics expert, a proven specialist in the field, takes a great deal of weight off your managersʼ shoulders…
The logistics operators already have warehouses set up abroad and work with local partners across Europe and worldwide. They therefore have access to an extensive network of warehouses to distribute your products to your customers, wherever they may be located.
Securing your logistics activities over the long term
The logistics operators have the experience and knowledge required to successfully carry out complex intra-logistical operations, particularly in terms of compliance with the applicable processes, legislation and standards.
When you choose to use their services, you can be sure that youʼre dealing with experts in the field, over the long-term, providing you with responsive and reliable correspondents in the event of any problem arising in the Supply Chain. For small businesses just starting out, this can be a considerable benefit!
It also entails a lower overall risk insofar as certain tasks such as the maintenance or upkeep of machines in the Supply Chain, finding replacements if staff are absent or sick, or adapting to seasonal peaks can be delegated to the service provider.
Reducing your environmental impact
Finally, using an outside service provider helps reduce your carbon footprint… A very good reason for choosing one carefully.
Some of them, such as GEODIS, can offer more responsible solutions. This can involve using suitably adapted packaging, making it possible to adapt the packaging in order to reduce the empty space in the boxes, using recycled and recyclable packaging, eliminating plastic in favour of environmentally friendly packaging materials and plastic-free tape, or dealing with “last mile” hauliers who are themselves engaged in reducing their carbon footprint.
To conclude, the benefits of outsourcing your logistics are many and varied, and this goes for both large and small companies alike. For the smaller businesses, outsourcing is available and recommended for the same reasons.
And if you still think that your e-store is too small for you to consider outsourcing your logistics, you should know that outsourcing of this type becomes profitable for a company when it places more than 100 orders a month…
But how do you go about it? The first step is to carefully define your schedule of requirements, and to get support from qualified teams!