E-commerce Logistics: What Every Brand Needs To Know

So you’re an e-commerce business owner. Chances are, you’ve got an awful lot on your plate.

When you were first getting started, there were only so many orders coming in at a time. You were still bringing in pretty good revenue, but fulfilling and shipping orders—and all the other logistics that go along with running an e-commerce store—wasn’t too tall an order.

But then the business began to grow…

Your revenue increased and business boomed, and all of the sudden those logistics tasks like fulfilling orders and processing returns weren’t as quick as they used to be.

More orders means more logistics to manage.

With all of these tedious tasks on your plate, how are you ever supposed to find time to bring in more customers and grow the business like you did before?

Of course, you can’t just ignore your e-commerce logistics tasks and let orders fall through the cracks. But the time you’re spending on logistics management is keeping you from reaching new heights for your business.

The good news is this:

There’s a much simpler way to manage your e-commerce logistics.
‍Before we dig in, let’s answer one important question:

What is Ecommerce Logistics? How It Applies to Ecommerce

What is ecommerce logistics?

To put it simply, e-commerce logistics is the collection of processes for acquiring, storing and shipping products or resources, and managing the costs and revenue associated with those processes. Logistics is what connects all the dots and allows all the elements of your business to work together as efficiently as possible.

Components of the ecommerce logistics process

The goal for any e-commerce business is to make logistics as fast, cost-effective and headache-free as possible.

To do that, there are five key questions you should be asking about your logistics processes, and a collection of tools you can use to effectively manage logistics.

Let’s dive in.

1. Where are your products coming from?

First, ask yourself where your products are coming from and what your current ordering process looks like.

The first step in the logistics process is making sure the people you’re working with are setting you up for success.

If you’re not working with reliable suppliers, you’re leaving your business open to a number of painful scenarios. A customer could place an order for a product that your supplier stopped carrying without letting you know. Or you could be paying premium prices for cheap products. If you don’t know and trust your suppliers, you’re putting your entire business at risk.

When you’re working with suppliers you know will deliver, the whole process becomes hassle-free. 

Domestic Manufacturing:

• Explore the advantages of sourcing products from local manufacturers to support the "Make in India" initiative.
• Evaluate the benefits of having better control over production timelines and quality.

Global Sourcing:

• Consider the international market for raw materials or components to enhance product quality or incorporate global design trends.
• Navigate the complexities of cross-border e-commerce, ensuring compliance with import regulations.

Inventory Management Models:

• Discuss the brand's approach to inventory, whether it involves maintaining stock in owned or third-party warehouses.
• Examine inventory models, such as made-to-order or dropshipping, and their impact on the supply chain.
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2. How are you managing your inventory?

After you’ve found the right suppliers to partner with, you need to figure out how to manage your inventory.

A lot of new e-commerce business owners think the only option they have is bulk ordering a ton of product and storing it in their basement, around the office and anywhere else they can find room. We don’t recommend this approach. Not only will it clutter up your space, it’ll cost you a ton of money up front and require very hands-on tracking of how much product you have on-hand.

To put it simply, it’s an awful lot of work for you.

Instead of trying to manage the inventory process on your own, the inventory management systems can do a lot of the heavy lifting for you. From basic storage to inventory tracking, taking this load off your plate will free up time to keep growing the business.

Supply Chain Transparency:

• Emphasise the importance of communicating the origins of raw materials and the manufacturing process.
• Showcase how transparent supply chain practices contribute to building trust with consumers.

Customisation and Personalisation:

• Explore the trend of made-to-order models and how brands leverage customisation for a unique selling proposition.
• Discuss the challenges and benefits of incorporating customisation into inventory management.
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3. What is your process for fulfilling orders?

If your order fulfilment process involves you or your team reviewing and confirming every order, manually packaging every order, then personally putting every order in the mail, you’re losing an awful lot of valuable time.

When you were first getting started, manually processing and fulfilling orders was probably more cost-effective than outsourcing to an order fulfilment company. That said, as your e-commerce business grows and demand increases, fulfilling every order by hand becomes borderline impossible. In this beginner’s guide to e-commerce shipping and fulfilment, Shopify explains how to take advantage of third-party order fulfilment systems.

With third-party order fulfilment systems, you can…

• Make the entire process hands-off for you.
• Guarantee every order is processed and shipped on time.
• Customise your packaging and labels to fit your brand.
• Choose the best packaging materials for your product.
• Track every step of the fulfilment and shipping process online.
• Save hours and hours of your own valuable time.

Not only will this make the entire process painless for you, but you’ll also be able to deliver on your shipping promises to customers without working yourself to the bone every night to get orders in the mail.

Order Fulfilment Strategies:

• Detail the brand's strategies for efficient order fulfilment, including technology integration for streamlined processes.
• Highlight the significance of a well-organised fulfilment process in meeting customer expectations.
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4. How long does shipping take and how much does it cost?

For your customers, the time between placing an order and finding a delivery on their doorstep can make the difference between ordering again in the future and saying bye-bye to your company for good.

In a world where Amazon Prime can ship internationally in two days or less, customers expect their stuff to arrive fast. If it’s taking weeks for them to get what they ordered, they’ll be hesitant to order from you again.

There are two things you need to be asking yourself when it comes to shipping:

How can I get customers what they ordered as quickly as possible? And how can I do it at a lower cost without sacrificing quality?

The less you spend on shipping, the greater your profit margins will be. The quicker you can deliver the goods, the greater your chances of leaving customers happy and willing to come back. To make this process as pain-free as possible, make sure you’re working with an order fulfilment partner that you can trust to ship orders on time every time.

Logistics and Shipping:

• Discuss the challenges and solutions related to logistics, especially in the diverse and expansive geography of India.
• Provide insights into shipping duration, cost considerations, and the importance of reliable courier partners.
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5. Do you have a system in place for processing returns?

If your returns management process is basically just you or someone on your team manually handling every return request that comes through, you’re losing valuable hours that could be spent on things that really help the business grow.

So how do you free up those hours you’re spending on returns?

You could just choose to stop offering returns altogether, but the negative reviews that are sure to follow will do even more harm than a manual returns system.

Luckily, you don’t have to nix returns entirely. Instead you can automate as much of the returns process as possible so you don’t get bogged down in tedious tasks like creating labels and getting approvals for each return.

Returns Management:

• Communicate the brand's returns policy and the importance of a customer-friendly approach.
• Detail the processes in place for handling returns efficiently and maintaining customer satisfaction.
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You can use Pragma’s Return Management System (RMS) to handle everything from the return request to the return labels to the emails a customer receives along the way so you can stay focused on growing the business.‍

10 best practices for ecommerce logistics

E-commerce logistics is a critical aspect of Direct-to-Consumer (D2C) business operations in India or anywhere else. Efficient logistics can significantly impact customer satisfaction, retention, and overall brand success.

Here are key considerations for brands engaging in D2C e-commerce in India:

1. Last-Mile Delivery:

India has diverse and densely populated areas, making last-mile delivery crucial. Choose reliable courier partners with a strong network to ensure timely and accurate deliveries.

Consider implementing technology solutions such as route optimisation and real-time tracking to enhance last-mile delivery efficiency.

2. Warehouse Management:

Efficient warehouse management is essential for timely order fulfilment. Optimise inventory levels, implement barcode systems, and leverage technology for better warehouse operations.

Consider multiple fulfilment centres strategically located to reduce shipping time and costs.

3. Regulatory Compliance:

Be aware of and comply with the regulatory requirements for e-commerce and logistics in India. This includes GST (Goods and Services Tax) regulations, customs duties, and other relevant laws.

4. Technology Integration:

Integrate your e-commerce platform with logistics and inventory management systems for seamless order processing.

Explore automation and AI solutions to streamline logistics processes, reduce errors, and enhance overall efficiency.

5. Returns Management:

Have a clear and customer-friendly returns policy. Establish an efficient process for handling returns to maintain customer satisfaction.

Work closely with logistics partners to ensure the smooth handling of returned products.

6. Payment on Delivery (PoD):

Cash-on-Delivery (CoD) is still a popular payment method in India. Coordinate with logistics partners to handle PoD efficiently, and clearly communicate payment options to customers.

7. Customised Packaging:

Consider environmentally friendly packaging options, and ensure that the packaging protects products during transit. Personalised and attractive packaging can also enhance the overall customer experience.

8. Customer Communication:

Keep customers informed about the status of their orders through automated updates. Provide tracking information and estimated delivery times.

Set up customer support channels to address queries and concerns related to logistics and delivery.

9. Scalability:

Design your logistics infrastructure to be scalable to accommodate growth in order volume. Regularly evaluate and optimise logistics processes to handle increased demand.

10. Collaboration with Logistics Partners:

Establish strong partnerships with logistics providers. Regularly review performance metrics and seek feedback to continuously improve the logistics chain.
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Types of logistics management

• Last-Mile Delivery: This involves delivering products directly to customers' doorsteps, often the final and most crucial step in the logistics chain. D2C brands need reliable last-mile delivery partners to ensure timely and secure delivery to customers across India.

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• Warehousing and Fulfillment: Efficient warehousing and fulfillment operations are essential for D2C brands to store inventory, manage orders, and fulfill customer demands. Utilising warehouses strategically located across India can help optimise shipping times and reduce costs.

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• Reverse Logistics: Managing returns and exchanges is a critical aspect of e-commerce logistics. D2C brands need effective reverse logistics processes to handle returned products efficiently, manage inventory, and maintain customer satisfaction.

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• Inventory Management: Accurate inventory management is vital for D2C brands to ensure product availability, prevent stockouts, and minimise excess inventory costs. Utilising inventory management software and partnering with logistics providers offering real-time tracking can help streamline this process.

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• Cross-Border Logistics: For D2C brands in India targeting international markets, cross-border logistics management is essential. This involves navigating customs regulations, coordinating international shipping, and ensuring compliance with import/export laws.

Ecommerce logistics companies

When it comes to e-commerce logistics companies catering to D2C brands in India, several players offer specialised services tailored to the needs of online businesses. Some prominent names in the Indian e-commerce logistics landscape include 

1. Delhivery
2. Ekart
3. Ecom Express Blue Dart
4. Shiprocket and many more.

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These companies provide a range of services including last-mile delivery, warehousing, reverse logistics, and cross-border shipping, enabling D2C brands to efficiently manage their supply chain and deliver exceptional customer experiences.

How ecommerce companies can offer 2-day shipping

Pragma’s RMS has reached far and wide in India due to 1 major reason -  its levels of customisable brand functionality, as it helps you integrate with 50+ Indian Multi-carrier/logistics partners, with a dedicated and branded return request page.

Brands can make sure that their return process looks personalised to the customer.

Furthermore, with return requests rising in number, you can put Return restrictions on select products that help the customer be aware of the no-return policy well in advance like; innerware, electronics above Rs. 2,500, etc.

This is further complemented by the addition of a Customisable multi-step approval process for accepting return requests, making sure you don’t receive random return requests from customers.

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While most of the RMS in the market provide a customisable dashboard, it becomes important to have a dashboard that has everything in one place.
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With Pragma, the brand gets access to:

1. Perform QC, Generate payment links, Store credit and initiate shipments all in one place

2. Leave comments to customers against their request - Add more details or reasons for rejection.
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With that being said, Pragma’s RMS is relentlessly empowering millions of users via its customer base of 450+. Let’s also see what benefits these features have on customers:

• The user feels personalised - Brand logo and colour customisations.

• One-click return/exchange request for users provides a seamless user experience.

• Get support for different kinds of refunds - Source, Coupons, Bank transfers and Store credit.

• Seamless browsing and selection during the exchange

• Accept exchange difference via COD or Prepaid

• Exchange with same or different product category

Do you know what’s the best part about Pragma?
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It's the Deep Analytical insights about customer behaviour that it provides. These can be very helpful in setting up an RMS largely due to the following reasons:

1. In-depth analytics on product performance, and pincode performance.

2. Access to Live data to build strategies on the go.

3. Multi-level nested reasons for better customer understanding. 

4. Assign different return reasons for different product types.

5. Flagging of risky users during order placement or return placement.
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It is important to understand that as you work towards enhancing the user experience, it is equally important to safeguard against fraudulent buyers exploiting the convenient return process for malicious purposes. 

Consequently, by utilising data gathered from 450+ D2C brands in India, Pragma can assist you in addressing these deceptive individuals.
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Now over to you.

Take some time to dig into each of these five questions. Figure out where your business currently stands and what processes you have in place to manage each component of your e-commerce logistics.

Once you recognise the areas where you’re putting in way more effort, time or money than you need to, you can take advantage of the tools we’ve highlighted at each stage of the logistics process to make your life so much simpler.

If you can take these tedious tasks off your plate, you’ll be able to spend more of each day focusing on the things that inspired you to start your business in the first place, whether it be working closer with customers or building a great product. The less time you spend managing every order, the more time you get to spend doing what you love.

What tools have you used to simplify your logistics management process? Drop a comment and tell us about your successes!

FAQs

1. What is the e commerce logistics process?

The e commerce logistics process involves managing the flow of goods from the point of origin to the end consumer. It includes order processing, inventory management, warehousing, shipping, and delivery.

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2. How important is efficient logistics for e-commerce brands?

Efficient logistics is crucial for e-commerce brands as it directly impacts customer satisfaction, retention, and overall business success. Streamlined processes ensure timely deliveries, accurate order fulfillment, and cost-effective operations.

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3. What are the key components of an effective e commerce logistics process?

An effective e commerce logistics process comprises last-mile delivery solutions, optimised warehousing and fulfillment, robust inventory management systems, seamless order tracking, and responsive customer support. 

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4. How can e-commerce brands optimise their logistics operations?

E-commerce brands can optimise logistics operations by leveraging technology, partnering with reliable logistics providers, implementing data-driven decision-making, adopting agile supply chain practices, and continuously monitoring and improving processes.

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5. What challenges do e-commerce brands face in managing logistics?

E-commerce brands encounter challenges such as inventory management complexities, last-mile delivery logistics, order fulfillment efficiency, returns management, cross-border shipping complexities, and maintaining customer satisfaction amidst logistical issues.

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