As an ecommerce business owner, you'll have to familiarize yourself with logistics. Back-end supply chain management is a critical component of any business today, but that's especially the case in ecommerce. Since you don't have a brick-and-mortar storefront to house inventory, you have to rely on third parties to help store and ship your products and services. This is crucial for basic time management — and for your bottom line.
Logistics is simply the management of the way resources are obtained, stored and shipped to their end destinations. The planning, execution and control of the movement and placement of these goods and services must all occur within a given system that's designed to achieve specific objectives, which may vary by industry.
Taking a more macro view, logistics management entails a few steps:
Larger companies often work with multiple parties to keep pace with demand. However, your small business doesn't necessarily need to partner with different organizations to manage your ecommerce website logistics. If your operation is small enough, you can work with local businesses and organizations to ship and store your products.
Logistics on a small-business scale aren't overly complex. Once a customer completes his or her order on your website, the transaction will trigger any inventory software you have. As a retailer, most ecommerce platforms will have integrated inventory management software, so a completed payment will automatically adjust your inventory accordingly.
Once you get the notification an order has been confirmed, it's time to ship the product. Depending on the size of your operation, the next steps could vary:
Yes. Since logistics has become so complex and reliant on digital technology, there are options for you to keep tabs on your inventory and where it is in the supply chain. Inventory management solutions within your ecommerce platform give you visibility into how much of a given product you have left. Inventory management tools give you real-time insight into your products so you're never behind on customer orders.
If your business partners with a service like UPS, FedEx or the USPS, you can also track items based on the fulfillment numbers they provide. Once the product leaves your hands, it may be a good idea to keep tabs on certain orders to make sure they reach the customer. It's also an industry best practice to provide the same tracking numbers to customers in their confirmation email so they can keep track of where their package is.