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What Is Retail Logistics and How to Make It Better

receiving furniture delivery to your residence. Pickup at the curb. placing an internet clothing order. Each of these relates to retail logistics.

Customers of today need a quick and simple interaction with your business. Providing them with the retail and transportation alternatives they desire entails meeting them where they are.

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Retail logistics optimises every step of your e-commerce supply chain, from controlling inventory movement to guaranteeing that clients receive shipments on schedule, to keep your firm operating efficiently.

Online retailers need to reevaluate their retail logistics approach in order to fulfill consumer needs, reduce shipping costs, provide faster shipping alternatives, and enhance the entire customer experience as ecommerce sales continue to rise in 2021.

The ins and outs of retail logistics as well as suggestions for streamlining your logistics management procedure are covered in this article.

Explain retail logistics to me.

Retail logistics include all incoming and outgoing procedures that lead to the movement of completed items from an enterprise to the customer. Building a strong retail logistics plan is essential to running a long-term direct-to-consumer (DTC) retail enterprise.

The receiving of goods from warehouses, inventory control, fulfillment, and shipment are steps in the retail logistics process. For the logistics process to match consumer expectations for quick and reasonably priced delivery, every step must be streamlined.

This implies that people (warehouse employees as well as higher-level managers like directors of logistics) and supply chain technology are frequently needed for a retail logistics operation, which can greatly raise logistics expenses. To save money and time, DTC businesses frequently contract out retail logistics to a third party.

What roles do retail logistics play?

Order fulfillment may appear simple at first glance. Orders are picked, packaged, and shipped to their destination by you. Simple, huh?

The truth is that attaining an efficient retail supply chain requires a great deal more work.

With the increasing expectations of online buyers, retail logistics has shifted to a technology-enabled strategy that prioritizes speed, location, and automation. This approach includes free returns, free and quick shipment, and even shareable unboxing experiences.

Purchasing stock

Getting goods to market quickly is known as procurement, and it has an impact on how you may run your online retail business, including distribution, sales, and inventory control.

Gaining knowledge about the procurement process might assist you in creating a supply chain that is more flexible.

Consider procurement as the first (and most important) step in logistics management, rather than seeing it as a distinct component of your supply chain logistics.

Ineffective procurement practices that are at odds with your retail logistics plan might cause delays, lower inventory visibility, and decreased efficiency.

For instance, you could find it difficult to acquire goods quickly enough to satisfy demand and process orders as soon as they are received. Stockouts and backorders may result from this, which may reduce consumer satisfaction and result in lost sales.

Missed possibilities for optimization might also arise from a lack of awareness over the procurement phase.

Receiving and handling stock

Order fulfillment requires that your items be received and processed first. This is the process of unloading incoming e-commerce merchandise and formally “checking in,” which is followed by appropriate documentation and storage.

Receiving and processing inventory is crucial. In addition to facilitating efficiency and expediting the fulfillment process, it guarantees that the product being received corresponds with the order.

It is much too simple to end up with loss (which can cause inventory shrinkage) when there are unclear protocols in place for tasks like unloading, receiving, or allocating SKUs. This can negatively affect both your customers and your bottom line.

Allocating stocks

An inventory allocation technique known as “distributed inventory” distributes goods throughout several warehouses or fulfillment locations as opposed to simply one. This system’s basic concept is to place your items closer to your clients, which is one of the best methods to expedite delivery times and save transportation expenses.

Customers will pay less for packages that travel shorter distances since shipping zones influence the cost of fulfilling retail purchases (like an Uber or Lyft journey; the farther the destination, the more expensive it will be).

Spreading inventory over many retail warehouses may help your business grow in an industry that demands quick fulfillment. This is because it will enable you to provide reasonably priced, 2-day delivery, which is a benefit that many customers take for granted because of companies like Amazon.

Many rapidly expanding firms outsource fulfillment to 3PLs like Locus, which run a vast network of fulfillment center sites, since they lack the time or resources to manage several warehouses.

Fulfilling orders

Never undervalue the demands of your customers for prompt, reasonably priced delivery. It’s critical to implement an economical and successful order fulfillment strategy.

Your customer’s order is authenticated and the appropriate goods are chosen and packaged promptly after they click “Submit Order,” thanks to a series of coordinated procedures. The procedure is referred to as order-to-cash (O2C).

Certain accounting and inventory management duties, such finding the products in the available inventory to complete the order and collecting payments from the client, must be completed within the O2C cycle.

An order management system is also necessary for a good O2C cycle in order to track orders and capture historical order data that is then utilized to evaluate O2C performance.

When you work with a 3PL like Locus, order fulfillment and processing are done automatically. Orders are routed to the closest fulfillment facility to the delivery destination as soon as your online store is integrated with Locus’s fulfillment platform.

After that, in order to locate and collect the things, a picker at the fulfillment center is given a list of the products, their quantities, and their storage locations. After that, the order is safely packaged and sent via the least expensive shipping option.