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Logistics in the eCommerce-Era

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3pls, Global Logistics, Global Trade Daily

Logistics in the eCommerce-Era

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Plans of business expansions and holiday vacations have been shattered and ruined by the pandemic. Memories of Christmas dinner and going to the local store without precautions are engrained in our minds. The world’s behavior has shifted to adapt to the consequences of a pandemic.

Many people are experiencing losses in business, losing employment and many other effects. The global ecommerce has over 3.5 billion registered users in 2020, providing many companies to grow in a new business concept without the brick and mortar store, and additional office workers. Ecommerce business has allowed supporting businesses to grow, in particular, the logistics industry.

As one of the oldest and largest industries, logistics is predominantly owned and operated by the older generation who has operated businesses with the same routine and procedures. Many logistics companies are still practicing the traditional method of doing business, with back and forth communication to negotiate and coordinate detailed requirements. However, consumers in ecommerce era are now demanding faster decision-making and transparency. With the right technological solution to handle multiple procedures, many important tasks such as administration, operations coordination, financial background check and verification, etc. can now be handled by complex computation algorithms instead of humans.

Companies can reduce miscommunication, mishandling, minimize delinquent accounts and improve response of customer service levels by creating a logistics technology that can perform job functions, such as Customs Clearance Procedures, Sales-Marketing Cross Promotion, Driver Instruction, and Operation Procedures, Warehouse and Airline Operation Procedures, Invoice and payment reminder, and others. With one platform, all of these features to help companies consolidate all logistics functions in one place.

The logistics industry involves many various parties in running its operation such as Shipper, Domestic and International Transport, Consignee, Customs officers, Warehouse Personnel, Accounting and others. This is a full operation which needs to be administered and monitored in order to be executed properly. With the help of technology algorithm, multiple information will be able to be distributed and delivered to the right operator’s smartphone device and will speed up notifications, operations, and processes.

Another key feature is the Face/Vehicle identification processes, allowing convenience to Shippers and Transporters to better monitor pick-up and drop-offs of shipments. With integrated technology features, the logistics industry will see improved service levels and the benefits of transparent cost structures to each transaction.

The pandemic has accelerated the pace of logistics digital transformation. Many new changes are seen as a result of the world crisis, including an increase in ecommerce businesses, remote work, online mobile orders and deliveries, and other changes. In order to survive as a business that has shifted away from traditional concepts, it is important to minimize costs and make smart decisions.

For the logistics industry, most infrastructure job functions and operation administration tasks can be performed through a smart algorithm platform. With an all-in-one platform, information can be accessed on mobile devices or desktops and is available on all operating systems. Logistics in technology platforms will allow better communication, organization, transparency, and companies will benefit by being more cost-efficient, connected, and productive.

business
Global Logistics, Global Trade Daily

How To Grow Your Business After COVID-19

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COVID-19 has upset economic forecasts and forced many companies worldwide to rethink their business strategy plan for the future. Finding success during this unprecedented time has been a painful process for many companies. Although the pandemic has brought new hurdles to businesses across the globe, it has also created loads of opportunities for retailers. A change in consumer behavior means more people are turning to online marketplaces for their shopping, which has redefined the position of ecommerce and online businesses in the retail sector. But this positive trend isn’t an assurance for future success. You need to develop a plan that intends the growth of your ecommerce business, in a post-pandemic context. Here are a few helpful tips:

1. Revise Your Current Marketing Strategy

Assess your current messaging process to establish whether you’re relaying the right message and positioning your business in the right way to succeed after the pandemic. This step will help you identify and get rid of marketing materials that don’t resonate with the current economic and social situation. Shun sending emails, updating on social media, or engaging in any marketing campaign that may seem insensitive.

Adjust your brand’s messaging to be in line with the unique needs and demands of your customers. Your message should show to both existing and potential customers the value they’ll get from buying your products or services. Offer appropriate, concise, and meaningful communication. Be sure to address the COVID-19 impacts, and the steps that you’re taking to bounce back big time. If you’re thinking about marketing your products to overseas consumers, consider entering a strategic partnership with a professional globalization partner. Optimizing your Global PEO strategy will always benefit your business’s revenues and will help you smoothly navigate your workforce abroad right after the pandemic.

2. Provide Unparalleled Digital Customer Experience

In a rapidly expanding ecommerce landscape where many sellers are providing the same products and services, offering better digital customer experience can set your business apart from your competitors. Some of the things that can help you deliver unrivaled digital customer experience include a smart and user-friendly interface, excellent support, efficient payment options, and the right technology infrastructure.

Poor networks and lack of strong data protection measures can easily damage an otherwise well-built customer experience. Websites and payment portals with poor loading speeds will drive customers away. Consumers will also avoid companies that are vulnerable to hacking and security breaches. So laying a solid foundational infrastructure for your ecommerce business can help it grow in leaps and bounds in the future.

3. Optimize Your Website and Incorporate Live Chat

Ensure your website is as responsive as possible and accessible on a wide array of devices. Enhance your website’s speed and ensure it’s extremely easy to use no matter the device the user is using to view it. Around 48 percent of people use mobile devices to search for product information and to shop. On top of that, 47 percent of digital shoppers prefer a site with a load speed of below two seconds. Avoid driving leads to competitors by creating a highly responsive and user-friendly site.

When a consumer is gathering product information while shopping, they expect answers to their questions right away. If they can’t get a quick response, they’re likely to move on to another online store. Live chat is almost equivalent to in-store customer service due to its ability to bring the advantages of human interactions. It adds a human touch to digital shopping. Most importantly, it can be done remotely.

4. Build Reliable and Diversified Supply Chains

The pandemic has demonstrated that the global economy relies extremely on supply chains, which are susceptible to disruption. With the increasing attention to digital customer experiences, ecommerce and online businesses must invest time and effort into consistently delivering products to consumers if they want to survive after COVID-19. Supply chain interruption can result in shipping and manufacturing setbacks if a company lacks a flexible plan to address ongoing demand.

In addition to investing in excellent network uptime, ecommerce businesses should look for multiple options for obtaining materials and labor. The best way to do this is nurturing relationships with a variety of suppliers, all of whom should have the capacity to comply with the intricate compliance requirements of different sectors. A globalization partner can also connect you with the best local vendors who’ll help you reliably deliver your products to your global customers.

5. Prepare for Capacity Growth

Invest in adequate technology infrastructures, such as servers and bandwidth, to help you deal with more ecommerce traffic. Do a thorough review of your past performances, revised marketing strategy, and latest ecommerce trends to gauge the amount of traffic you’re likely to attract. This information will be important in a proper estimation of demand and building the right capacity to exploit it.

Adopting cloud computing can help your business provide the best digital customer experience and react to ecommerce trends rapidly. It’s easy to upscale or downscale cloud computing capacity to handle growing demand quickly and effectively. For better control and flexibility, you can invest in a hybrid cloud infrastructure.

6. Be Transparent with Pricing and Consider Lowering Delivery Charges

Post-COVID-19, customer loyalty will be extremely crucial for your company. Consumers share their experiences, both positive and negative, on social media, and review sites. Negative reviews can have a major negative impact on your profits margin. Avoid concealing extra fees or details that may come as an undesirable surprise during the final stages of finalizing a purchase.  Be transparent from the initial stages to keep customers pleased and loyal.

A large number of regular online shoppers end up making more purchases when shipping is free or considerably low. Lowering or doing away with delivery charges could result in a significant uptick in sales. If your current profit margins can’t accommodate this, consider value addition. You can give a discounted delivery on purchases exceeding a specific value.

Conclusion

The high ecommerce demand caused by the COVID-19 pandemic is likely to become permanent even after brick-mortar stores resume operation, especially if it follows the normal trends of online shopping habits. Companies that adapt quickly will stand a better chance at growing their businesses and expanding their profit margins by exploiting this great opportunity. The above 6 tips will help them grow their businesses even in post-pandemic circumstances.

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Global Logistics, Global Shippers 101, Global Trade Daily, International Trade

HS Code Classification Freeway: Take Your Exit

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Since the introduction of the Harmonized Tariff System (HTS or HS) in January of 1988 and its global implementation in following years (for example, in the U.S. on January 1, 1989), classifying products (i.e., associating the tangible product to its related HS code) has been a global party. Used on import (and export) declarations, HS codes identify the duty rates applicable to the specific goods, relate to statistics, give regulators an opportunity to link Anti-Dumping Duties (ADD) and Countervailing Duties (CVD) to products, dictate how to qualify for preferential treatment, and can govern document and license requirements. Quite a laundry list—and that makes the correct HS code classification an important piece of information, especially when using an incorrect classification can lead to penalties and delays upon import.

In the U.S., with roughly 16,000 HS codes to choose from, a customs ruling database for U.S. classifications only (CROSS) that is 206K classifications strong, ongoing changes to import tariffs, and a massive World Customs Organisation-initiated overhaul every five years (2022 here we come), it is no wonder classification is evergreen on trade compliance professionals’ list of concerns that demand a significant amount of attention.

To make it more complicated—although harmonized globally at the six-digit level, local authorities are allowed to differentiate down to a local nth digit (usually eight or 10) and have not been hesitant to do so. For example, the U.S. and European Union both support HS codes that have 10 digits, but few are the same or represent the same products. As import declarations are filed locally, this implies that, for each importing country, a different HS code must be identified and then maintained for any product shipped into that country. Do the math: a product catalog of 50,000 parts that ship to 50 different countries adds up to a solid 2.5 million classifications. Not something to maintain on the back of an envelope—unless it’s a really, really big one, erasers are cheap, and pencils are free.

With widely diverse needs for classification (e.g., from a B2C ecommerce shipment of two cotton T-shirts that need an HS code for a quick landed costs calculation, to raw materials and semi-finished products for manufacturers, to a single unique import of a $10 million factory engine), it is no surprise that any self-respecting Global Trade Management (GTM) solution or consultant is happy to assist companies in desperate need for those classifications. And no wonder that, since around 2000, numerous software companies have been trying to solve the mystery of auto-classification.

The diversity in the initial reason for classification comes with different parameters for success. For an ecommerce retailer, an autoclassification tool can solve many challenges (e.g., quick returns, high volume of items are immediately classified), but accuracy can be a challenge. A lack of accuracy is not something importers can afford when, for example, the classification determines whether the import is subject to ADD, is heavily restricted from a license perspective, or is subject to quotas. Basically, (auto-) classification is like a freeway and, depending on the exact needs, companies take a different exit.

There are three key components to a successful (auto-) classification project—other than, of course, the hopefully not superfluous statement that a decent amount of classification expertise comes in handy when either classifying or building a tool.

First, the quality of the product description. ‘Garbage in, garbage out’ also applies to classifying. Poor descriptions, lack of product detail, or even incorrect specifications will likely lead to an incorrect HS code with all related consequences. For quality descriptions, product managers or developers may get involved to provide the necessary technical detail as some classification decisions are made based on those elements.

Second, the classification logic. Whether the classification is assigned by a person or a tool, classification logic cannot lack, well, logic. This means many things: rules that decide to classify a piece of clothing that is not gender-specific as textiles for female or male (and the U.S. handles it differently from the EU); rules-based classification that guides the correct classification in a decision matrix fashion; the ability to ignore information not relevant to the classification (e.g., color); or the ability to observe characteristics that may be needed in one case but not for another (e.g., weight), including material compositions that are usually very important. The logic must also account for a way to ‘smart search’, or search across different references to generate results from, such as synonyms, natural language, industry jargon, and even from images. In addition, classification logic means integrating Artificial Intelligence (AI) and Machine Learning (ML) into the application so results can automatically improve, which enhances both the number of items classified and the quality of the classifications without human intervention.

Third, the classification reference database. The classification logic must look to match a description with an HS code not only by matching it with a ‘word in the tariff’ but also with the explanatory notes and, preferably, for broader context a natural language reference. This might include a shipping manifest reference or information gained via access to previous imports and classification repositories of identical products. Regardless, all types of references need to be reviewed before the final classification is determined. The logic is only as sound as the foundation on which it is built.

It’s important to keep in mind that references are also where, as an industry, companies should actually assist one another. Data privacy concerns notwithstanding, there must be a way to ‘crowd source’ references, which could reduce the efforts made and resources spent on classification in sensational fashion—engineering a classification freeway that is even more well-marked and efficient to traverse.

E-commerce
Global Logistics, Global Trade Daily, Special Reports

E-commerce Will Continue to Grow in Importance Post-COVID

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As we enter the second half of 2020, the global COVID pandemic seems to be slowing down in some places and taking wing in others. Through all the waves, however, one thing is becoming certain: we still have quite a while to go until things go back to “normal.”

For businesses, this brings a host of challenges. Although there’s a necessity to flatten the curve, economies cannot halt for the next year or so until scientists (or nature) come up with a solution. Ultimately, this means that some form of adaptation is necessary.

E-commerce growth in 2020

One of the most significant changes that we saw in consumer shopping habits in 2020 was the rapid growth in popularity of e-commerce. Just a few months back, online shopping was considered unreliable by most individuals over 65. Almost overnight, however, it has become an essential practice. And some numbers testify to the growth of e-commerce.

For example, for Q1 2020, Amazon reported a 29% increase in North American and an 18% increase in worldwide sales. What is even more interesting is that grocery sales have grown a full 8%, compared to the slower growth of 1% during previous years.

On the whole, this is a clear indicator that e-commerce is gaining importance in today’s society. And not just in categories such as tech, apparel, or entertainment. It’s also becoming more relevant when it comes to purchasing health or other essential products. 

With this increased exposure, it’s also likely to expand further during the coming months and years. After all, it’s widely available, convenient, and no longer a foreign concept to most.

For business owners, this prospect of accelerated growth sends a clear message. If they haven’t already, now is the time to make e-commerce an integral part of their business operations.

Changing work models

Adapting to changes can be difficult. And many have already made leaps to keep their operations going during the pandemic. From working remotely to introducing online shopping, these changes have made it possible for small businesses to carry on during these trying times.

But the truth is, small businesses need to put much more effort into their e-commerce webshops to allow them to work with the same efficiency as physical businesses.

For Americans, spending habits have changed drastically since the beginning of the year. The retail industry has taken a big hit, as have companies working in travel, hospitality, entertainment, and even health.

Moreover, there is a tendency towards turning to local shops for a variety of products. Of course, this is a lifeline to small companies who have taken the biggest hit since March. But, it can also be bad news for those whose business models were developed to serve a more global market.

This is why businesses need to start acting now.

Following trends

Over the next period, e-commerce businesses will need to be much more vigilant about how they approach the future. 

First and foremost, they will need to employ risk-mitigating strategies, which will allow them to continue reaching customers. These include diversifying supply chains, implementing DTC models, relying on automation, as well as re-thinking the entire business process.

Furthermore, they’ll need to pay special attention to meeting customers’ needs. Basic conversion-boosting practices such as search engine optimization, decreasing page load times, improving copy and visuals, will all influence user experience, and thus sales and rankings.

One way to future-proof e-commerce businesses is to take a hands-on approach to mobile optimization. Right now, mobile shopping is witnessing growth, and this trend is only likely to continue. If they want to keep up, businesses should adjust early on by adopting mobile optimization tools that are popular among their users.

Moreover, with fewer opportunities to make sales face to face, web design should receive a higher amount of attention. Do you deal with products for which tactile or sensory information is crucial when it comes to sales? Consider whether the visual content on your pages could bridge the gap between online and in-person shopping experiences.

You can look for inspiration from companies that are managing to do this with success. For example, Zoma is an online mattress retailer. Their product collection pages were designed to clearly illustrate the differences between various types of mattresses. This allows users to find the product that will meet their needs with much less hassle.

source: zomasleep.com

Putting customers first

Providing more in-depth information about your products and keeping your website visitors’ needs in mind is a big step in the right direction. However, it’s not going to be enough.

In e-commerce, sales rely on impeccable user experience, so you need to come up with ways to provide it to your customers. Things like free shipping, 24/7 customer service, or high-quality instructional content all play a part in driving conversions.

For this reason, it’s not a bad idea to call attention to the changes you’re making to your service. Are your locations open? Are you taking orders? Are you taking any extra precautions to protect your buyers? It may be wise to use a popup or banner on your website’s homepage to communicate to customers about how COVID might be affecting your business. A good example of this is the banner shown at the top of supplement machine manufacturer LFA Capsule Fillers website.

source: lfpacapsulefillers.com

As the current situation unfolds, you may even want to create a separate section on your website, addressing your response to COVID. That’s what retailer Massimo Dutti did. On their dedicated COVID-19 page, they call attention to an extended returns period to 30 days, as well as free standard home delivery.

source: massimodutti.com

For business owners, these changes are quite small. Though they require an investment in terms of time, they do provide a high level of value to customers. Ultimately what they’re doing is establishing a greater sense of trust, which is critical for any business, but especially for those just now expanding into e-commerce. In the end, trust translates into customer loyalty (and higher conversion rates). 

Navigating uncertain terrain

With the global situation being unpredictable at the moment, consumer behavior is more volatile than ever. What this means for businesses is that they need to be ready to make quick adjustments. And the only way to do this is to pay closer attention to everything that is or isn’t working.

One thing’s certain: e-commerce will continue to grow at a rapid rate, especially in the coming months. For this reason, do your best to follow current trends. Future-proof your business, mitigate risks, and find ways to improve your service. This way, you’ll be decreasing the chance of being run over by the times, and allowing your business to reach new heights.

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Global Logistics, Global Trade Daily, Special Reports

Impulsive Shopping and Post-Pandemic Consumer Behavior

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Picture this. You are in the supermarket in your neighborhood queuing to pay and see some delicious and totally irresistible chocolates that you did not even think about buying but that now are something that has become essential. That is what in marketing is called “impulsive buying” and, for example in the case of supermarkets, it is their main source of benefits.

Let’s take it up a notch. Have you thought about how you can translate an Instagram or Facebook like into a sale? That’s called Influencer Marketing, and I’ll show you how to unleash this online technique by starting a conversation and ultimately driving sales and establishing impulsive shopping, whether this was your initial objective or not. Remember, one like, share or comment, might equal one sale.

The Internet and mobile devices, as instant tools, favor impulsive purchases. Different promotions present on your website can trigger unplanned purchases by Internet users. Imagine being able to have those displays that are in the boxes of the supermarkets integrated into the design and shopping experience of your online store… How much extra income could they bring you? The experience may surprise you.

Flash sales (Time-limited): Flash sales are time-limited sales that are very often used in e-commerce to encourage impulsive buying. Generated by an attractive offer but limited in time, the user has to make a quick decision if he does not want to miss this opportunity. It works very well, especially in specific seasons where people are willing to spend more money (Christmas, back to school, Halloween).

Free shipping: The hook is to set a minimum purchase price so that the shipping costs are free and, if the customer does not yet have that amount, offer low-cost products in the checkout process that achieve the minimum required quantity. If we use products that far exceed the minimum amount, it will not work, but if they are inexpensive and related to the purchase that has been made, success is practically guaranteed.

Stock level: Showing available stocks can, to some extent, favor impulsive buying. If the number of products in stock is low, the interested visitor will tend to buy their product for fear of not finding it again at the price proposed in your online store.

Give away discount coupons or free products (gift): On condition of making a purchase, of course. This type of tactic has been shown to also boost sales since the customer must buy in order to receive their gift.

Expiration date:  Discounts on these types of items range between 20 percent and 50 percent of their initial price. For example, if they are products that expire the next day, the price is usually cut in half, but if we talk about products that have weeks to expire, the discount stays between 20 percent and 30 percent. Stores free themselves of products that would end up in the garbage and without any benefit if not bought, while customers get a good deal for a product that they would either buy or just purchase to take advantage of that specific occasion.

After the pandemic

From toilet paper in the early pandemic to bleach and flour, during this crisis consumers have modified its consumption and its way of making the purchase. But what will the consumer be like after pandemic? It is evident that many consumers have had to test the online channel as a result of this crisis, and they have realized how comfortable and safe it is for them.

The confinement has made the segment of the population that least bought online, those over 55-60 years old, now the group that needs it the most, especially those over 70, who are the most vulnerable to the disease and those who, therefore, should be more confined and without the help of their families. Although the consumer preferred to buy some specific products in person; if consumers verify that the product they receive at home meets their expectations, it is very likely that after the crisis it will continue to do so.

On the same line of shifting consumer behavior, for instance, some of the most popular products today are related to protecting employees and separating consumers with employees, like speak-thru devices, trays and shelves, and sliding service windows.

Where do impulsive purchases predominate: in physical stores or on the internet?

Physical stores are the main claim to get a customer to buy without having thought about it before. This fact is partly logical because most impulsive products are food, clothing, drinks, and personal care products. If discounts and promotions are added to that, the mix is ​​perfect. Supermarkets, shopping malls, and convenience stores are the central places for this type of sales.

Furthermore, some stores go the extra mile by using techniques that play with your senses, by releasing exquisite coffee and fresh cookie smell to get you in, even if they’re not in the food business.

Online advertising is the least appreciated to generate buying impulses, but that does not mean that their tactics are useless: Brands that use digital platforms as the first approach and establish the first connection have the potential to reap the benefits when the time comes to make the final purchase in the store, according to a study by Geoblink. 69 percent of those surveyed stated having bought between one and five products spontaneously in the last week, while 26 percent admitted having made between six and ten purchases of this type.

The millennial generation is the one that buys the most on impulse: a small group of 7 percent have bought up to 11 items without foresight in the last week. The previous facts serve as a great opening remark of the aforementioned Influencer Marketing technique. If you got until this part of the story, it means that there’s impulsive buyer material within you.

Influencer Marketing is nothing more than getting the right people to talk about you, firstly triggering your target audience to talk about you, secondly prompting that audience talking to each other about you, and finally you and the audience listening to each other. When this two-way conversation is in place, it is very probable that some of your social media likes, whether on Instagram or Facebook, are in fact translating into sales in your physical or online store.

There are a couple of exceptions to this rule on digital impulsive buying: the first, that those who already have a subscription to a platform like Amazon, which avoids having to go through several stages before buying, are better able to combat the impulsive factor. The second: when the object to buy is an electronic item. 55 percent of the participants chose the Internet as the preferred medium for the impulsive purchase of these items.

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Featured in the Best Online Shops 2020 – Newsweek, DK Hardware is one of the largest online home improvement retailers for a variety of hardware manufacturers all over the United States and Canada.

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3pls, Global Logistics, Global Trade Daily

E-Commerce Logistics and Supply Chains: Journey to the Future

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The transition of commerce to an electronic format is a well-established and economically sound process which is in its prime. Shopping and paying online has already become an integral part of modern life. Conversion of e-commerce platforms is more than 7% versus just 3% in the retail sector. But how has the transformation of e-commerce affected logistics?

The transportation of products remains a physical process that cannot be realized through the Internet. However, electronic administration of logistics processes is available now, and advanced technologies help optimize the product movement along the supply chain. How does this all happen and what are the current trends – let’s understand.

Why Classic Logistics Has Become Obsolete

The answer is simple: needs are growing.

If we immediately exclude the possibility that a business delivers goods on its own without involving third parties, then, in any case, there is some company in the chain between the brand and the consumer. With its help, goods get into the hands of buyers from different cities and countries.

But if earlier, in most cases, it was a matter of delivering the product to stores and other retail structures, now everything is much more sophisticated. Buyers may request delivery to their nearest post office, special pick-up point, or even directly to their home. This required a qualitative change in storage conditions and technologies used.

Reasons for the Rapid Development of Logistics

In order to take their place under the sun in a trading niche, brands choose the most effective methods. This is what is most appreciated by any buyer – a wide range of products and short delivery time: who would want to wait for their goods for several months? The same goes for digital commerce. Therefore, you should not be fooled, for example, a case of Photza digital photo retouching service, when they reduced the delivery time from 3 days to 2 and began to send ready-made photos not only through your personal account on the website, but also duplicated by email link to Dropbox, increased conversion by 17.3%.

A good example of successful adapting to new realities is Amazon. By activating 50 picking warehouses throughout the United States, this giant got the opportunity to promise customers next-day delivery. With the help of a special code (SKU), each item was designated, then it arrived at the distribution center, and was ready to be further piece-picked for individual orders.

The closer the inventory to the buyer, the faster the delivery. Other retailers and businesses quickly realized this and began to deploy new capacities, using both internal departments and shared resources managed by third-party partners.

New Trends and Their Impact on Logistics

Implementation of Digitalization

This is a crucial thing that makes sense to mention. Advanced technologies, the ability to create and use customized software adapted for each business and its logistic model, electronic databases and much more allowed many brands to reach a new level.

Digitalization not only accelerates work, but it also provides greater stability and sustainability in the implementation of supply chains. With its help, brands can check the availability of products in any storehouse at any time, request information on the latest deliveries as well as the status of different orders, manage inventory and pre-compile optimal routes.

The Same-Day Delivery

The question of how to speed up the process of getting the product into the hands of the buyer continues to occupy the minds of brands. The most relevant category of goods for delivery on the same day is, of course, food. One can also include consumables here. Short-lived commodities do not stand the test of time, therefore, special conditions must be provided for them. And this is not a whim of the client or the quirk of the manufacturer, but an urgent need.

Moreover, there is a certain relationship between service and money, which people consider appropriate to pay for it. This balance should be carefully calculated and taken into account. It is also interesting that more than 60% of clients are willing to pay more in order to receive the goods on the same day or at least the next day. If the brand has the opportunity to fulfill this desire, then we can say that it is already one step ahead of its other less savvy competitors.

To reduce the cost of delivery and ensure its optimization, platforms such as Uber implement market models that analyze and compare supply and demand. For example, they select available couriers and orders received in real time and, by appointing a courier to deliver a product, seek to minimize the average travel time. The whole system is fully automated: large amounts of money were invested to ensure its correct functioning. Notably, they fully paid off, because as a result, the organization has received a platform that provides stable and trouble-free operation.

The scheme of working with local couriers is gaining momentum, and in the near future, many large retailers are expected to switch to it. This is convenient and, as indicated above, requires the greatest cost only at the initial stage of implementation. With the correct formulation of the problem and the determination of the goals pursued, success will not be long in coming: it remains only to maintain the system and periodically update it. No one wants to be left overboard as an outdated option.

Couriers Robots

Delivery of goods by robots is also not as far away as it might seem. Starship Technologies is already launching its standalone food delivery robots in Tempe. Self-guided robotic vehicles can carry orders weighing up to 40 pounds over a distance of 3 miles. Autonomous navigation is provided by a 360-degree camera, which makes a robot an absolutely independent counterpart to couriers, reducing labor costs by more than 70%. Bots work best in urban centers.

There is no information about possible obstacles to their movement yet. In addition, such machines encounter far fewer legal barriers than their unlucky colleagues – drones.

The Power of Social Media

While marketing and link building strategies allow the brand to improve its online visibility, social networks dominate in matters of instant communication with customers. Clarification of address details, obtaining prompt feedback and providing the information requested by customers optimize logistics processes from a coordinating point of view.

SaaS Options to Streamline Supply Chains

Manual supply chain management with modern production volumes nowadays seems almost impossible; to say the least, then certainly both an outdated and inefficient method. Therefore, many businesses resort to various software-as-a-service supply management options.

This process became especially popular after the entry of cloud computing into the game. It made available timely informational and structural updates and created easy ways to manage infrastructure costs.

Advanced Product Tracking Scheme

The use of GPS has become another milestone in the history of an e-commercial boom. With its help, it became possible to track the location of the goods at any stage of their journey, whether it be moving to a regional storehouse or last-mile delivery. Moreover, tracking is a useful option for customers: they can clearly imagine and assume how much they have left to wait for their goods.

In the event of an unforeseen situation, brands can immediately detect problems and take all necessary measures to restore the procedure for transporting products to the buyer.

In the End

Modern problems require modern solutions. Therefore, in parallel with the new e-commerce opportunities, up-to-date options appear that handle the transportation of small and large goods equally well. Digitalization has given a significant impetus to the growth of new capabilities. Timely delivery at a price that satisfies the customer is what businesses strive for by updating their logistics models.

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Marie Barnes is a Marketing Communication Manager at LinksManagement, where you can buy real backlinks, and is a writer for gearyoda. She is an enthusiastic blogger interested in writing about technology, social media, work, travel, lifestyle, and current affairs.

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Foreign Trade Zones, Global Trade Daily

The Boohoo’s Trade Ascendency – What Can we Learn?

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The Coronavirus crisis has taken it’s fair share of victims in the world of retail, tolling the death knell for a whole slew of companies including Debenhams, Long Tall Sally, Cath Kidson, Warehouse and Oasis. And yet, recent news tells us all is not lost – Boohoo has stepped in and bought the online businesses of both Warehouse and Oasis for a bargain £5.25m. It’s no surprise that e-commerce based retailers have been less hard-hit than their high-street counterparts, but even so, the majority of e-tailers have reported losses during the crisis. Not so Boohoo. Despite a slight downturn when the crisis hit, sales shot back up in May and they closed the first quarter with a 45% sales increase on the previous year. So what is it that makes Boohoo so special?

Their secret it seems is in their provisioning – the “Test and Repeat” model. Rather than making major forward orders and holding large amounts of stock in their warehouse, they instead purchase small product runs, test them on the site, and then restock quickly the products that work well, discarding those that don’t. This has been vital during the COVID-19 crisis as it allowed Boohoo to switch their product range from party and club styles to loungewear and athleisure within a matter of days, adapting to their audience’s requirements without missing a beat. As the retail sector faces an uncertain future it’s worth considering whether this business model may be the solution for retailers everywhere, whatever their size.

The difficulty is sourcing products quickly enough to make it work. There’s no point in having a successful test-run of a certain product if, when the first batch sells out, your restock order from suppliers in China or India can take up to 2 months to arrive – by this point the bird will have well and truly flown. Boohoo combats this by stocking mainly UK based suppliers, and with imports affected by travel restrictions and breaks in the supply chain, sourcing products locally is, without doubt, the obvious solution (particularly with Brexit on the horizon). Some retailers may balk at the higher prices, but with lower risks and less deadstock, the benefits do seem to outweigh the increased costs.

The Coronavirus crisis has forced an entire industry to stop and think, literally. How can we change the way we work to face the challenges that have taken us all by surprise? Short-order provisioning may be a way for businesses to adapt to this new situation and respond to the rapid changes in consumer demand that are sure to continue over the coming months, however, this is likely to be a step outside of the comfort zone for many retailers who are used to ordering for season months in advance.

The good news is that there are simple options to help with the switch to the “Test and Repeat” model. TradeGala offers ready-to-ship stock from over 50 independent fashion brands covering womenswear, menswear, childrenswear, accessories, gifts and shoes. It’s simple to register and you can go from initial order to receipt of goods in just a few days. Whether or not the recent changes signal the future of the fashion retail industry, as with any business, adaptation is survival. Is your retail business ready for the “new normal”?

ecommerce
Global Trade Daily, Special Reports

What are Common Mistakes Ecommerce Newbies Make?

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Ecommerce businesses have recently seen a growth in their sales, and many business people have decided to start their own ecommerce business to capitalize on how well ecommerce has performed during COVID. However, newbies tend to make common mistakes that could easily be avoided if they caught them on time. These mistakes do not happen due to a lack of interest or knowledge, but probably due to the speed in which people are trying to jump into business. Once you realize the errors, you can easily correct them with a little more research.

The most common mistake newbies make is starting out with a new product. They try to create their own new product, instead of offering a product that is already trending. It would be better to start by following a trend to get people interested in the brand. This way, your business will attract more customers who want to purchase a product they have already seen others use and know it works, or it will fulfill their needs. By starting out with a new product, something people do not know nor trust, can set you back and lead to failure.

Some also choose to sell a high-ticket product. This means it will be a much higher cost per purchase, and you will need to have a set budget separated for advertising costs. Starting with high-cost products can be too big of a step to launch your business. You should focus on starting with a product within your budget to guarantee that you will not be losing money and your revenue will meet your goals.

Another common mistake is people not understanding their metrics correctly. There are several metrics to keep in mind.  Some of the most important ones are:

-Email click-through-rate.

-Cost per acquisition.

-Organic acquisition traffic.

-Social media engagement.

-Micro to Macro Conversion Rates.

-Average order value.

-Sales Conversion Rates.

-Customer retention rate.

-Customer lifetime value.

-Repeat customer rate.

-Refund and return rate.

-Ecommerce churn rate.

-Net promote score.

-Subscription rate.

The key metrics–the ones you really need to know and understand–to start your ecommerce are advertising cost, cost of goods, and revenue. It is particularly important to understand them before you go into business because the lack of knowledge can easily mean loss of money when you start advertising. Make sure you understand the cost per purchase and know how to make it work according to your budget.

One common mistake newbies tend to make is not setting up the right payment processors to accept the purchases. An example of that could be PayPal putting your money on hold for the next 30 to 60 days. To avoid situations like this, you need to find processors that were specifically created for ecommerce businesses and can make this transaction easier for you and for your customers.

Luckily, these mistakes are avoidable. The most important step is to do thorough research and understand your return on ads spent. You need to have an advertisement budget set aside; to spend and to have in case you lose money. Create a spreadsheet with your cost of goods and your revenue. Find merchant processors that are experts on ecommerce and suppliers who can provide the best prices to lower your cost of goods.

Starting an ecommerce business is like starting any other business. You need to be prepared to do it, understand what it takes to start a business and have the knowledge of what steps you need to be taking. If you do your research and know your key elements, you will be able to avoid all the common mistakes newbies make.

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Steven Ridzyowski has been a leader in the eCommerce/digital media buying space for over ten years. Ridzyowski takes pride in being self-taught in all aspects of his career. It’s probably why he is such a driven entrepreneur today! He started out of high school, deciding to never go to college and learning advertising blogs with Google AdSense and taking on what would soon become his career and passion.

After a couple of years doing that, Ridzyowski was introduced to affiliate marketing. During that time (2008-2010), cellphones and ringtones were becoming popular, and Ridzyowski became an affiliate in the ringtone niche for a few years. Little did he know, he was paying “influencers” on YouTube to have links for ringtone offers in the music video description, before “influencers” became the sensation they are now.

As he grew and became a successful affiliate marketer, he worked alongside many advertisers and colleagues. Ridzyowski then went on to create his own white label skincare brand, which became one of his pivotal successes.

Between the moment of changing from affiliate marketing to owning and running digital media buying for his own skincare brand, he started to follow trends, learning the ins and outs of digital marketing, spending over $30m in paid digital ads across the entirety of his career. Ridzyowski mastered different advertising platforms, generating income across many businesses in various niches and verticals.

Today, Steven Ridzyowski is focused heavily on e-commerce and marketing, especially with his new agency, which offers a turnkey solution for e-Commerce.  Ridzyowski has mastered everything from product research, to product trends, to marketing in all kinds of niches. In the past three years, he has created converting funnels to growing multiple 6 to 7-figure stores with his agency. He has helped hundreds of companies, both large and small, reach their full potential and created an online presence for them. Ridzyowski is also a member of the Forbes Business Council and the Young Entrepreneur Council.

Connect with Steve Ridzyowski on LinkedIn at https://www.linkedin.com/in/stevenridzyowski/

Follow Steve Ridzyowski on Instagram @ StevenRidzyowski

“Like” Steve Ridzyowski on Facebook at https://www.facebook.com/StevenRidzyowskiOfficial/

Follow Steve Ridzyowski on Twitter @ SteveRidzyowski

Watch Steve Ridzyowski on YouTube at

https://www.youtube.com/channel/UCf-IaxhjT9vKP_P-bkmam8Q

delivery
Air Cargo, Global Logistics, Global Shippers 101, Global Trade Daily

Is your Ecommerce Caught Between Delivery Delays and Voided Service Guarantees? Strategies to Survive this Situation.

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The pandemic has disrupted ecommerce businesses in unique ways. While a few ecommerce stores went bust, others doubled their revenue overnight. Regardless the parcel volumes continue to soar. The parcel volumes are so high that even major shipping carriers like FedEx and UPS are overwhelmed. For example, FedEx alone saw a 35%-40% increase in B2C deliveries. An unprecedented rise in shipments has forced both the carriers to resort to undertaking stringent actions.

Carriers Suspend Service Guarantees

FedEx and UPS have suspended money-back guarantee for ground and priority services. Let’s take a minute to understand what this means for merchants. An escalation in order volumes directly impacts the carrier’s on-time delivery performance. It is almost a given that merchants will experience a minimum of 20% increase in delays. An explosion in sales, impatient customers, and shoddy delivery experience. Add to it, COVID uncertainty and unaccountability resulting from voided service guarantees. Sounds like a disaster in the making?

When delays are imminent

With the growing volume of residential deliveries clogging their network, carriers may redirect traffic to relieve congestion. Suspension of guarantees also means that FedEx or UPS can switch your priority shipments to lower-cost ground mode without notice. Expect more delays for overnight and priority shipments. While you pay for a premium service there is no way you can hold carriers accountable.

Watch out for COVID-19 Surcharges

In order to mitigate the strain on their delivery network, UPS followed by FedEx has come up with peak volume surcharges. A $30 surcharge as additional handling charges and $0.40 for services like FedEx SmartPost or UPS surepost. But the surcharge that retailers must be most concerned about is the residential area surcharge. A surcharge of $0.30 will be levied on all orders that are to be delivered to residences.

Strategies to survive

The disastrous combination of delivery delays and rising shipping costs can ruin your sales revenue. It is crucial to take steps to mitigate the impact of COVID on your shipping costs as well as customer experience.

Here are a few strategies to follow:

1. Re-negotiate your shipping contract: UPS or FedEx can’t spring a surprise charge. Especially during these trying times. Work through your shipping profile to figure out the impact of these charges on your costs. Negotiate with your FedEx or UPS rep and draw up a special contract for the COVID situation.

2. Consider charging for order delivery: Free and fast delivery has been your brand’s USP. However, if including a shipping fee helps your business stay afloat, don’t shy away. Don’t let the additional surcharge eat into your profit margin.

3. Delays should not deter you: Factor in for delays while revisiting the estimated date of shipments on your shipping page.  Communicate well in advance to your customer support team. Mention the changes to delivery times due to COVID On your home page.

4. Over-communicate with your customers: Let your customers know at all times where their package is. Stay on top of your orders at all times. Act quickly in case of a delivery exception.

5. Audit your invoices: Businesses are slashing all the excess spending. As for ecommerce, you should start by auditing your shipping invoice. It is more critical than ever to examine each and every line item on your invoice. This can help you save 10%-12% of your shipping costs.

The peak volume surcharges and service guarantee suspension are supposedly temporary. When things go back to normal, FedEx and UPS are likely to reinstate these service guarantees. However, with no clear timeline in businesses must prepare to navigate the status-quo as long as it lasts.

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Simon Perkins is a Shipping Cost Management expert at AuditShipment.com, a real-time parcel monitoring and AI-powered audit service that provides businesses with deep shipping intelligence and actionable cost recovery insights.

layout
Global Trade Daily, Warehousing

How to Optimize Your Warehouse Layout

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The design of your warehouse can either expedite or hinder your entire operations. It’s why it’s important to update your warehouse layout to best optimize your work area. However, it’s not just enough to rearrange a few aisles and place a few stickers.

Every warehouse is different from the other, but there are some universal tips anyone can use. One of the biggest warehouse layout tips would be to map out the entire layout on paper before anything, that way you can measure your needs and figure out what can fit where.

There’s a lot that goes into designing a new warehouse layout, such as which equipment to use and how much space should be dedicated to storage.

BigRentz took note and created a helpful infographic (below) for anyone looking to set up a new warehouse layout.

 

BigRentz Warehouse Layouts