How to Plan Logistics for an Uncertain New Market?

By | Nov 27, 2019 |0 Comments

As another year comes to a close, many online business owners are focussed on planning the year ahead. For some of you, it could mean developing a new logistics plan or enhancing previous strategies and tactics to increase efficiency.

Obviously, you know your role (in terms of supply chain processes) even before you step your foot into an unknown business or uncertain market. Transporting goods from point A to point B requires a strong and reliable shipping plan in a sequential and detailed process. There are several links that craft a dependable and efficient supply chain and many obstacles that can cause that link to rupture or break. Hence, a solid logistics plan holds together all of the tactics or links in your company’s effort to run things smoothly. In a way, it also guarantees success in the form of more traffic to the site, higher ROI and more sales.

But what if your supply chain planning is out of practice? Or what if you see yourself reining the stallion directionless? Well, in that case, it would be good to rely on a good shipping aggregator platform. ShipKaro encompasses a variety of tools and features to improve your supply chain plan.

Here are the 5 steps that e-retailers like you might want to follow to develop a sound e-commerce courier service plan when venturing into new markets.

1. Chalk out your service offer

Let’s understand this through an example. Years back, Dominos Pizza came up with a service offer that if pizzas aren’t delivered within 30 minutes, they would provide complimentary orders to the customers. To claim this statement, the company chiselled out their supply chain plan accordingly. Of course, there were bloopers there, but for Dominos, everything revolved around their delivery plan at that point in time. The same also holds true for online businesses where you might have noticed entrepreneurs clearly defining their service offers on the website. This could be anything from ‘Avail your product within two days of order’ or ‘Avail free shipping on Rs. X and above.’

Your logistics plan should support the offer you make to your customers. This will largely depend upon what you are selling and what tactics you have planned to ship the products to your customers. Do you supply raw material to factories or finished products to consumers? In this case, product packaging should be mentioned clearly on your site. What modes of transport do you use? This will let you define how many days it will take the product to reach the end-users. Do you wish to transport goods domestically or globally? Depending on this you can choose your e-commerce courier service partners.

The majority of the time, a well-established carrier will be the answer to all of the above questions. Sometimes, one carrier is not the solution. You might have to rely on multiple carriers to cover various service offers that you claim. This is important to keep up with the promises you make to your customers and underselling their expectations.

2. Sneak Peek into your Primary and Secondary Markets

A lot of your supply chain strategy will depend upon your service offer and what is it that you are selling. Are you managing logistics for physical items or perishable food items? Are you shipping clothes, delicate fashion accessories or heavy goods such as furniture or electronics?

However, it’s also a good idea to study the market and know your primary and secondary consumers. Is your fulfilment strategy meeting their expectations? Are you providing customers what they want? These are the questions you might want to ask yourself before you plan strategies for the years to come or redefine your existing plan. 

Like for instance, if you are selling fashionable eye-wear then Tier-1 and Tier-II people could be your potential customers. They might want to pay in cash when they receive the orders. Does your logistics plan provide this option? If not, you might want to redefine it! Likewise, some of your customers might be willing to pay extra for certain products that they need urgently. In that case, do you split the orders and opt for partial fulfilments? Perhaps you might want to shuffle the orders between multiple carriers to fulfil this particular consumer need.

When you are testing the waters in terms of new businesses then determining the markets will be dictated by your logistics capability and capacity. This can include material handling, production, packaging, inventory, transportation, warehousing etc. It’s important to establish your primary and secondary market focuses and reassess the market opportunity each year. Markets shift over time and so can your supply chain needs. By re-evaluating your primary and secondary markets, you will be able to better adjust your shipping goals and increase efficacy at all levels.  

3. Identify your competition

Since you are about to kick-start an online business, your competition is not going to be restricted demographically. If you wish to sell footwear or gift articles, then any other e-retailer selling similar products across the globe could be your competitor. One way to improvise your own e-commerce courier service plan is to closely study these companies and gain from them.

You might want to start penning down who your tier-1 and tier-2 competitors, followed by companies that you consider best practice reference. Then think what is that you offer and your competitors don’t. The answer could lie in how well you handle return shipment of products or how quick your fulfilment partner is in terms of before-time delivery. Once you identify these points, you might want to start thinking as to how you can do these things differently or better. For example, if your competitor uses its own logistics department, you might want to try a commercial carrier and identify the benefits and challenges of each one of them.

Generally, every e-commerce company has competition, irrespective of how specified or niche their product category, services or market may be. At some point in time, if you are unable to track direct competition, then look for contextual references. Taking the time to thoroughly analyse market competition lingering on the sideline unnoticed, can help you refine the vision and focus of your logistics strategy.

4. Articulate your value proposition

So let’s say you have thoroughly evaluated the market competition and determined what will make your supply chain strategy stand out. Now could be the time to articulate it in such a way that customers will understand and recall it. It is a good idea to revolve the value proposition around lower prices, newer technology, operational efficiencies or even return policies and guarantees.

What is it that will make your e-commerce courier service stand out in a field that’s overcrowded with companies offering similar facilities? If you are unable to think of obvious examples that highlight the advantage, then do not worry! Sometimes your most satisfied customers have those answers. You might want to go and check the testimonials or client feedback section where customers have reviewed your products and services. Try to read between the lines and see what they have to say. Are they saying you provide them real-time tracking that exactly tells you where your product is or are they talking about the free-shipment that you announce every now and then?

Once you get these differentiators, hone them for good and articulate them as value propositions to strengthen your logistics chain.

5. Evaluate costs

The long gap between what you offer your customers and what you wish to offer can be bridged only if you calculate your costs on a timely basis. As the new year seeps in, costings will change significantly. Perhaps the carrier you have hired or wish to hire will announce a new rate or the material cost for the product packaging will shoot up. One way or another, your calculations can go for a toss if you do not keep a check on them intermittently.

No matter what your business is, the supply chain definition should include sustainability and cost-effectiveness. It is a good idea to determine how much money you want to spend on your e-commerce courier service and how it will be segmented. You can do this segmentation basis:

  •         Cost for carrier partnerships
  •         Warehousing needs
  •         Transportation expenses
  •         Packaging and weight
  •         Manpower and labour charges
  •         Technology and maintenance

Evaluation of cost will provide you a clear picture as to where you stand and what you can offer to your customers. Can you afford to give them fancy and durable packaging? Can you provide them free-shipping and discounts? Can you promise them quick delivery? All these answers will turn positive only if you optimise costs and make your logistics strategy affordable.

Are you planning to venture into online business anytime soon? You will soon need a shipping aggregator platform that helps you plan your logistics systematically. ShipKaro’s facilitates you to roll out a swift supply chain that matches any retail or B2B product category and diversified market. Moreover, it’s tools ensure automated processes to optimise cost and make the entire supply chain process more sustainable. 

Schedule an appointment with us today or drop a line below to get in touch! 

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