One of the largest shifts in the logistics industry over the course of the COVID-19 pandemic has been the massive growth in e-commerce borne by consumers under extended lockdown orders. While growth in online retail has been steady for years, the rapid acceleration brought about by lockdown orders was entirely unforeseen. By Q2 2020, e-commerce was up 45% year-over-year (YOY), making up 16.1% of total sales volume in the USA.
Deliveries were delayed, products were out of stock, and orders never slowed down. This has resulted in pressure for businesses to evolve their fulfillment services, moving towards omnichannel fulfillment models that grant consumers and businesses many options to choose from. Today consumers conveniently hop online and decide if they want to have their order shipped to their door, to a pickup location, or if they would prefer to pick-up curbside. These are some of the most common B2C (business-to-consumer) methods of order fulfillment, though B2B (business-to-business) orders are also adapting to these and other distribution methods such as work-site delivery.
To help keep supply chains agile and clients informed, visibility technology plays an important role. Modern 3PLs (3rd Party Logistics Providers) employ a sophisticated warehouse management system (WMS) that can seamlessly integrate with a variety of clients’ software platforms. With access to real-time inventory data there is less room for communication issues in basic requests such as confirming product availability. With the WMS overseeing the order fulfillment process from processing through distribution, clients gain peace of mind, and warehouse staff gain valuable time for picking and packing more orders.
Where the WMS aids in-warehouse operations, a transportation management system (TMS) oversees the vehicles that distribute warehouse inventory. The TMS aids in optimizing shipping routes, improving delivery schedules, and adding cost-efficiencies. As distribution becomes more complex, such as with e-commerce driving demand for omnichannel order fulfillment, a TMS gains greater value. With a TMS, clients gain further visibility of their product, allowing for quick responses when the unexpected strikes. This ability to react quickly is a cornerstone of any resilient supply chain.
If everything ran perfectly, fulfillment would end with delivery, but returns are a reality that also require consideration when discussing order fulfillment. A painless returns process, or reverse logistics, can be the difference between customer retention and a 1-star review. With the right 3PL damaged goods can be repaired and refurbished in the distribution centre rather than shipping back to a distant production plant. Repackaging and relabeling capacity allow for further cost savings and rapid order turnarounds.
As buying habits change businesses are being challenged to quickly adapt to these new models or run the risk of being left out of the digital economy. When your fulfillment services need a shot in the arm, thyssenkrupp Supply Chain Services is here to provide the well-rounded boost that your business needs.