Written by Raúl Carrión
Índice
If you are thinking of setting up an online store to give a new focus to your work life, you may visualize yourself doing the most glamorous and exciting tasks of this business: product acquisition, online marketing strategies, conversion analysis, etc. However, you should know that you will also be responsible for the daily management of the orders and the logistics of the online store in general.
The logistics of an online store consists of receiving, storing, shipping the merchandise and also managing order returns.
Read quickly it may seem like a small thing, but in reality it is a task that involves a lot of dedication and work.
Disadvantages of the logistics of an online store
In general, the logistics of an online store are not much fun. The following is a list of the main disadvantages that we usually encounter:
You fill your house with boxes
If your product is not very large, you will usually end up dedicating a room in your house to store stock. You will also need to have a sufficient number of cardboard boxes, shipping envelopes, stickers from your shipping agency. Everything you need to prepare your order correctly.
You spend a lot of time preparing orders
When you confirm the payment of an order in your online store, you must assemble a cardboard box and put in it the products ordered by the customer. You should also pack it properly and contact your usual transport agency to pick up the goods as soon as possible.
The need to process orders within hours of receiving payment confirmations requires that a person is on duty every day of the year.
You must stay at home during pick-up times
During the time period in which the delivery person can pick up your orders, you cannot move from your home. Otherwise, your orders would arrive a day later at their destination, generating discomfort to your customers. This point is especially uncomfortable for those of us who manage online stores because it makes us feel cooped up at home.
Handling returns is time-consuming
This is not common, but sometimes the customer does not accept the goods. The reasons can be very varied: it has been damaged in transport, we made a mistake when placing the order by choosing products that were not requested or simply because the product does not meet your expectations. In such cases we must unpack the returned goods to check their condition and either put them back into our small warehouse or discard them depending on their condition.
You must periodically balance the stock
From time to time we must check the number of units we have of each reference to make sure that the available units match the values we have entered in our online store.
It is also important that we have alerts to be informed when we reach a minimum number of units of any of our products.
In general and in my personal opinion, the tasks involved in logistics are the ones that I find least rewarding as an online store manager. What really excites me is design and execute an online marketing strategy where you can use all the existing disciplines and tools: SEO, AdWords, Email Marketing, Content Marketing, Social Media, web analytics, etc. to attract a significant volume of visits to your online store (traffic) and get a reasonable percentage of these visits to buy (conversion). Without forgetting the work of maintaining contact with these customers to promote future sales(loyalty).
For entrepreneurs and business people who think like me, there are companies that free us from all the offline work: they are called logistics operators.
Functions of a logistics operator
A logistics operator for online stores performs the following tasks:
Receiving the goods
Whether it is a domestic or imported product, a logistics operator receives the merchandise at its facilities, classifies it and registers it in its system so that you can have real-time stock control.
Storage of goods
They store all your products in optimal conditions so that they can be easily located and orders can be processed quickly.
Picking
When a purchase is successfully completed in your online store, you only need to send the order data to your logistics operator. He will be in charge of assembling the box, inserting the requested units, packing the merchandise and managing the shipment with the transport company of your choice. Some even offer transportation services directly to provide a comprehensive service.
If the transaction volume of your online store justifies it, they may recommend you to link your online store platform with their order manager so that this step is done automatically and your intervention is not necessary.
Stock control
A logistics operator for online stores usually offers the service of real-time stock consultation. Either through an intranet or through a web service that automatically consumes your online store platform. This will prevent orders from being placed for unavailable references.
Returns management
If an order is returned, the goods will be returned directly to your logistics operator and therefore, they will be in charge of checking that the goods have not been damaged in order to put them back in stock and include them again in the stock control.
Advantages of contracting a logistics operator
Hiring a logistics operator service for online stores will provide you with the following advantages:
Geographical independence
You will be able to manage your online store from anywhere in the world. All you need is a computer with an Internet connection. You can move to Indonesia and your online store will still work just as well.
More time for you
No more late nights preparing orders to go out the next morning. You won’t have to stay at home all morning waiting for the delivery man to pick you up.
More space at home
You will recover the invaded room, you will no longer have an excuse to set up a gym at home and, if there is time to spare, use it. Ah! And no more smelling like cardboard at all times.
Prices of logistics operators for online stores
The price of logistics operators for online stores is scalable, i.e. the cost will increase depending on the merchandise stored and the number of orders handled. This way, when you start your online store, the cost of this service will be very low and you won’t be financially drained as soon as you start.
There are mainly two billing modalities:
- Invoice on the one hand the storage and on the other hand invoice each time an order is placed.
- Invoice a fixed amount per order, regardless of how long the goods are stored.
The decision will depend on the selected logistics operator, your business expectations, your number and volume of references to be stored.
For new online stores it is common to negotiate a price for the first three months with the condition of revising the rate after this period, due to the lack of information on the number of orders that will be served daily.
I personally prefer to negotiate a fixed price per order to make the financial analysis of the business easier.
Finally, here are some recommendations for hiring a logistics operator for online stores:
Before contracting this type of service, ask for several quotes, as the price and quality of the service may vary considerably from one provider to another. We are talking about a very new service and therefore the methodology and market rates are very heterogeneous.
Once they start working, it is very important that you closely supervise their work: delivery times, condition of the delivered goods, quality of returns management, etc. Consider them your external logistics department and demand the necessary degree of involvement.
And if they don’t convince you, don’t be afraid to change. If you detect errors that are difficult to correct, start looking for alternatives to offer the best service to your customers.
As you can see, by hiring this type of services your online business can become as glamorous as you once imagined. Travel the world in search of new suppliers or for pleasure, while your orders are methodically shipped to our satisfied customers.
