Modern Retail: Fulfilment Update August 2023

CONTENTS

OPTIMISING THE GOODS IN PROCESS

STRATEGIES FOR STREAMLINED AND CUSTOMER-CENTRIC ECOMMERCE RETURNS

ECOMMERCE FULFILMENT TRENDS

CONNECT BACK WITH YOUR EU CUSTOMERS

OPTIMISING WAREHOUSE EFFICIENCY

CHOOSING SHIPPING PARTNERS: KEY CONSIDERATIONS FOR ECOMMERCE SUCCESS

SHORT-TERM SPACE IS CRITICAL TO A SUCCESSFUL WAREHOUSE STRATEGY

Credits

Managing Editor - Rob Gamage - rob@modernretail co uk

Business Development Manager - Emma Mjekiqi - emma@modernretail.co.uk

Many thanks to all those who provided editorial content or images, helping us to compile what we hope is a useful and informative read! Please send any feedback or comments to editor@modernretail.co.uk.

Watford, Hertfordshire, United Kingdom, WD18 9SB

OPTIMISING THE GOODS IN PROCESS

By Rob Gamage, Managing Editor at Modern Retail

The Goods In process is a vital component of ecommerce fulfilment. It involves receiving, inspecting, and documenting incoming inventory. This process ensures accurate stock control and sets the groundwork for efficient order fulfilment and satisfied customers.

Accurate Goods In processes ensure products are in the condition they should be before being made available for sale while minimising errors and delays.

Rachel Delasalle, Regional Operations Manager at ILG concurs:

“A successful fulfilment operation is fundamentally driven by an efficient Goods In process. The Goods In department is the first touchpoint of the end-to-end fulfilment process and

accuracy of the inbound process has a significant impact on the rest of the fulfilment operation.”

Preparing for Goods In

To prepare for the Goods In process, retailers should focus on three key areas: space, equipment, and personnel. Sufficient space is necessary for receiving, sorting and organising inventory. Having the right equipment, such as forklifts and barcode scanners streamlines the process. Adequate staffing levels and proper training ensure efficiency. Additionally, implementing a robust inventory management system enables accurate tracking, real-time visibility, and seamless integration with other departments.

Rachel Delasalle continues, “An

organised approach to Goods In management is essential. It’s important to keep accurate logs of inbound stock due and open POs, as well as efficiently store records and documentation of shipments received to provide reliable traceability of stock.”

Receiving the Goods

The process of actually receiving the goods involves unloading, documentation and inspection. Depending on the type of goods, the level of inspection may vary. Conducting quality checks is essential to ensure customer satisfaction and minimise returns, as Johannes Panzer, Head of Product Strategy, E-Commerce at Descartes outlines:

“Quality inspection depends to some degree on the supplier and the type of goods being processed but, generally speaking, we suggest spending more time on the quality check at Goods In, as this lays the groundwork for a streamlined order fulfilment process. Errors that happen at Goods In can only be resolved later in the process with great effort.”

Debra Grimwood, Marketing Manager at Kardex agrees:

“You also have the ability with an efficient goods in procedure to hold

suppliers accountable for the goods they ship. Meticulous inspecting and documentation can be addressed. The documentation here is critical in offering concrete evidence in case of any disputes and ensures suppliers meet their obligations.

“But for many it comes down to controlling costs and maximising efficiency. By processing incoming goods and verifying accuracy and resolving any issues, it will minimise the risk of holding onto extra or incorrect inventory. This reduction in carrying costs, combined with warehouse space utilisation will help maximise operational efficiency and overall profitability.”

Receiving the goods is not all about quality control, of course, but also an important stage in ensuring efficient inventory management. Debra continues:

“Inventory accuracy is key here. A well-executed Goods In procedure will ensure that incoming goods are

accurately received and recorded in an inventory system. The checking of received items against purchase orders, verifying quantities and inspecting quality are all essential in maintaining inventory accuracy. Efficient processing of incoming stock and updating the inventory system enables accuracy of order picking, packing and shipping.”

Electronic Product Code, a reader via which the information can be read, and a transmitter unit for data transmission.

"Advantages of RFID technology include fast acquisition of data without visual contact, in contrast to barcodes. Because objects do not need to be aligned, it is possible to capture larger amounts of data and several data carriers in a fraction of a second.”

Labelling and Sorting

Technology can make a huge difference to the efficiency of receiving goods. Edward Hutchinson, Managing Director of BITO Storage Systems, highlights RFID as useful tech:

“RFID technology is being used more frequently in logistics for incoming goods, as well as for outgoing, tracking, inventory management and order picking.

"The RFID system consists of an RFID transponder that has an identification number or an

An efficient labelling and sorting system improves order processing, reduces delays, and ensures accurate inventory tracking. It helps employees locate items quickly, minimises errors in order fulfilment, and contributes to timely delivery. Investing in effective labelling and sorting systems, including barcode labels and automated technologies, is crucial for efficient operations and customer satisfaction.

Johannes Panzer suggests to:

“Always ensure goods have been labelled with the correct barcodes. As part of a streamlined process, the printing of the barcodes should take place during Goods In. If the products are too small to be labelled individually, we suggest you use fixed bin locations or boxes to store the items, which carry the respective

"The checking of received items against purchase orders, verifying quantities and inspecting quality are all essential in maintaining inventory accuracy."

item barcode.”

Storage

Proper storage of goods is crucial for efficient operations and customer satisfaction. Different types of goods may require specific storage conditions and adhering to these requirements ensures product quality and minimises the risk of damage or spoilage.

Johannes Panzer outlines the need to tailor the storage to the specifics of the goods themselves:

“Put away goods based on how and when you expect them to be sold:

Big pallet shipments: Identify a replenishment/bulk area where you store them, when you know the pick face in the warehouse cannot be used for storing them. Big pallet shipments for which a drop/sales campaign is coming up shortly: Put them closer to the packing area in order to keep the length of picking routes for your team to a minimum.

Small shipments: check at Goods

In if items have been ordered on demand because there are open customer orders waiting to be fulfilled - and then bring them to the packing area to process the orders further. Small shipments ordered for regular restock purposes: Depending on your warehouse setup and storing strategy, put them wherever appropriate (e.g. there may be zones set up for hanging garments or various racks in place for products of different sizes).”

Conclusion

Optimising "Goods In" processes is crucial for the success of fulfilment operations. By optimising their Goods In process, ecommerce businesses can enhance operational efficiency and maximise customer satisfaction.

Debra Grimwood of Kardex agrees:

“While the Goods In procedure may not always be in the limelight, its importance cannot be understated. From maintaining inventory accuracy and streamlining order fulfilment to ensuring quality control, holding suppliers accountable, controlling costs and preserving data integrity, an efficient Goods In procedure will drive operational excellence and customer satisfaction. By recognising its significance and investing in optimisation, businesses can elevate their fulfilment capabilities and gain a competitive edge in today’s fastchanging ecommerce market.”

STRATEGIES FOR STREAMLINED AND CUSTOMER-CENTRIC ECOMMERCE RETURNS

By Rob Gamage, Managing Editor at Modern Retail

Effective returns management is a crucial aspect of any successful ecommerce business. It’s critical to optimise the returns process to ensure customer satisfaction, build trust, and maintain a competitive edge. In this article, we’ll explore the key strategies and best practices for managing ecommerce returns, from establishing clear returns policies to leveraging automation and technology solutions. By implementing some of these recommendations, you can streamline your returns management process and create a positive experience for your customers.

Clear & Transparent Returns Policy

A clear and transparent returns policy forms the foundation of a successful returns management process. By clearly communicating your policy, you set customer expectations and reduce potential confusion or frustration. When developing your returns policy, consider including key elements such as timeframes,

condition of items, and returns shipping responsibilities. Clearly state the steps customers need to follow when initiating a return.

To effectively communicate your returns policy, provide easy access to it on your website, preferably on the product pages and in the checkout process. Use concise and easy-tounderstand language, ensuring that customers can quickly grasp the necessary information. Consider using visual aids, such as icons or infographics, to enhance clarity.

Danny Ellard, Business Development Manager at ILG, believes the key areas of a returns policy are to, “have a clear returns policy and a userfriendly returns portal for your customer to arrange returns hasslefree; offer clear and accessible returns shipping options; and provide easyto-follow guides or instructions for repackaging or re-bagging items to ensure each returned item is easy to process.”

As Danny highlights, having a streamlined returns process is essential for efficiency and customer satisfaction. Beyond your returns policy itself, a streamlined returns process should start by outlining the steps involved in a return, including customer initiation, returns authorisation, returns shipping, and refund or exchange. Optimise each step to minimise customer effort and maximise convenience.

Make it easy for customers to initiate returns by providing multiple channels for initiating returns, such as online forms, email, or phone. Automate the returns authorisation process to ensure prompt approval and minimal delays. Provide clear instructions and prepaid shipping labels (if you’re not charging for returns) to simplify returns shipping for customers. Once the returned items are received, aim to process refunds or exchanges promptly, enhancing customer trust.

Efficient Returns Handling

Efficient returns handling is vital to

value of returned inventory. Thoroughly inspecting returned items is crucial to determine their condition and eligibility for resale. Establish clear guidelines for assessing item condition and implement quality control measures to ensure accuracy.

Johannes Panzer, Head of Product Strategy, Ecommerce at Descartes feels focusing on splitting out the physical returns handling from the rest of the process is important: “What our customers find works best is typically splitting up the physical processing of incoming returns from the financial refund process. This helps to get items back in stock and thus available online quicker.

“If returns departments/stations work closely with the customer service team, the financial refund process can also be initiated swiftly, creating a positive customer experience.”

It’s important that returned inventory is organised systematically to facilitate efficient handling.

Separate items by condition and return reason to streamline the decision-making process. Consider integrating returned inventory back into your fulfilment process whenever possible to minimise storage costs and maximise resale opportunities.

Johannes concurs, “in addition to customer refunds, the returns process should focus on restocking items efficiently. This involves accurately determining which returned items can be returned to regular online inventory and which are no longer sellable in their original condition. Proper evaluation and sorting of returned items allow businesses to make informed decisions about restocking, repairs, or disposal.”

Automation and Technology Solutions

Automation and technology solutions play a pivotal role in streamlining the returns management process. Barcode scanning enhances accuracy and speed when receiving returned items, while inventory management systems track returned inventory, automate workflows, and optimise stock replenishment.

technology solutions that allow for digital capturing of return information and automation of return workflows, businesses can streamline the process and expedite the assessment and handling of returns. This reduces the time it takes to complete the returns process and facilitates quicker customer refunds or exchanges.”

Johannes Panzer adds, “digitising the returns process can lead to faster processing times. By implementing

Several software platforms offer comprehensive returns management solutions that can automate various aspects of the process and are worth considering as part of your fulfilment toolkit.

Customer Communication

Effective customer communication is essential during the returns process. Promptly respond to customer inquiries and concerns, demonstrating your commitment to customer satisfaction. Invest in a robust customer support system that enables your team to provide timely and accurate responses.

"Proper evaluation and sorting of returned items allow businesses to make informed decisions about restocking, repairs, or disposal.”

Proactive communication is key to keeping customers informed about return status and refund progress. Send automated notifications at key milestones, such as when the returned item is received or when the refund is processed. This level of transparency reassures customers and helps build trust in your brand.

Continuous Improvement and Analysis

To maintain a competitive edge in the ecommerce landscape, it is essential to continuously improve your returns management process. Analyse return data to identify trends and areas for improvement. Look for patterns in return reasons, product defects, or shipping issues to address the root causes and enhance product quality.

Johannes Panzer highlights the importance of this philosophy, “returns are an inherent part of B2C ecommerce. It is impractical to completely eliminate returns, as customers have the right to return products that don't meet their expectations or requirements. However, businesses can work on reducing the frequency of returns by analysing the reasons why customers return items. This analysis helps identify the root causes of returns, enabling businesses to address those issues and improve product quality, descriptions, or sizing information. By proactively addressing the underlying factors that lead to returns, businesses can reduce return rates and the associated costs.”

Leverage return data to refine your product descriptions, images, and sizing charts, thereby reducing returns due to misrepresentation or improper fit. Use customer feedback obtained during the returns process to identify areas where your products or services can be improved. By embracing a culture of continuous improvement, you can enhance customer satisfaction and reduce returns over time.

Conclusion

Effectively managing ecommerce returns is a critical component of building customer trust and loyalty. By implementing the strategies outlined in this article, you can streamline your returns management process and create a positive returns experience for your customers. From establishing clear and transparent returns policies to leveraging automation and technology solutions, optimising your returns process will help your ecommerce business thrive.

ECOMMERCE FULFILMENT TRENDS

By Rob Gamage, Managing Editor at Modern Retail

Ecommerce is a continuously evolving industry, and developments in fulfilment and logistics play a significant role in developing the online retail landscape of the future. Modern Retail spoke to Edward Hutchinson, Managing Director of BITO Storage Systems, to get his take on today’s ecommerce fulfilment trends…

MR: What recent improvements have we seen in ecommerce fulfilment?

EH: Through continuously optimised capacity planning, it has become possible to react more quickly in the event of bottlenecks. The use of software and greater productivity have led to increasing warehouse capacities as well as greater transparency of data. There has been an increase of digitalisation and automation through the use of robots, cobots and AGVs to, for example, automate picking and packing processes and general internal logistics.

AI can increase productivity and minimise errors in a wide range of processes including product demand forecasting, inventory management, transport capacity planning, controlling AGVs and robots, and optimising picking processes.

The Internet of Things (IoT) where sensors on devices report back information, creates a data highway in a company and is becoming more necessary for modern WMS. This might feature RFID scanners automatically recording the receipt of goods in the warehouse and passing the information to the WMS, which in turn informs robots of the specified storage location. Replacing barcode scanners with RFID scanners, which only have to be aligned in the direction of RFID transponders on the articles, makes multiple or bulk scans possible.

MR: What can we expect the ecommerce fulfilment processes of tomorrow to look like?

EH: Automating more of the intralogistics process will ultimately reduce cycle times, which will enable operations to extend order cut-off times, thus improving their service offering. Continual developments in modularity, sophisticated control systems and performance will increase warehouse automation’s practicality and flexibility for fulfilling omnichannel retail. This means automation is stepping closer into the economic justification zone for more operators who are juggling higher volumes, growing demand for faster order fulfilment and greater value on

the one hand, with rising staff costs on the other.

These factors are merging into a trend that is seeing automated ‘goods to picker’-based order picking installations increasingly being integrated into intralogistics systems. While larger organisations grapple with the kind of robotic technology that can perform such dexterous tasks as picking individual items for ecommerce orders – which remain some way off from practical application – smaller operators have opportunities to benefit through simple and more attainable automation and robotic systems which are available now, as well as ‘mechanised’ solutions, such as live storage. Such systems provide a rapid payback because they do not require elaborate infrastructure or a large capital commitment, but they do provide a stepped approach towards fully fledged automation.

Some of the most exciting developments are likely to evolve from storage solutions created by companies that offer the requisite experience and expertise to address a specific customer need.

MR: How can advances in AI improve fulfilment?

EH: The rapid development of Artificial Intelligence (AI) is leading to the rapid development of process optimisation – ie, the task of analysing workflows, documenting them, uncovering weaknesses and developing an improved workflow. In addition to smoother processes and improved quality, cost savings can be a further goal.

There are many possible applications for optimising processes and workflows in a manual warehouse. Classic methods include value stream mapping, process mapping, total

quality management, LEAN, Kaizen, and Six Sigma. In the context of digitalisation, however, new developments such as digital value stream mapping, process mining or motion mining are increasingly gaining ground. With the help of these applications, a large amount of data can be collected digitally, which means it can no longer be evaluated and interpreted manually using classic methods. AI solves this challenge. With the help of big data analysis, structures and dependencies in the data can be recognised and identified, which gives the planner, in addition to those responsible for operations, a variety of targeted options for action to optimise processes.

There are possible uses for AI applications such as process mining and motion mining in almost all areas of intralogistics. Examples include inplant transport (forklifts and other industrial trucks, as well as continuous conveyors), process analyses with corresponding performance and quality data, and motion analyses during picking and packing. Another essential aspect, in addition to the identification of quality defects and ‘waste’, is the improved ergonomic design of work processes. For this purpose, a virtual model of a warehouse is usually created. With the help of this ‘digital twin’, simulations of warehouse workflows and processes can be carried out to optimise storage locations.

CONNECT BACK WITH YOUR EU CUSTOMERS!

By UKPWorldwide

Despite being a distant memory for some, the effects of Brexit are still a big topic of conversation for online retailers. Unfortunately, it’s not only EU retailers that lost UK customers, but UK retailers have lost EU business too!

UK retailers are struggling to reach their EU customers due to strict compliance processes now in place for non-EU businesses. Some have changed their business model by introducing warehousing in Europe some have just discontinued shipping to the EU. The harsh reality though is that some UK businesses have lost a vital revenue stream.

If this story sounds familiar to you, why not let UKP Worldwide (UKPW) help you get your EU exports back on track?

UKPW have been shipping tens of thousands of eCommerce parcels internationally pre and post Brexit. We specialise in end-to-end delivery including customs clearance of your goods to prevent delay. Our in-house accredited system will take care of all the mandatory GB & EU customs declarations and requirements on your behalf, ensuring that duty and VAT are accounted for, and that your goods flow seamlessly across borders delivering an uninterrupted journey for your customers. Just as importantly we can also help repatriate any returned items, reclaiming duties paid where applicable.

Send us your packaged eCommerce parcels and upload your pre-alert, manifest and supporting

documentation via API to our customs clearance portal. Once your parcels are received at our UK hub, they will be processed on a tracked service with UKPW taking care of all the relevant customs clearance checks and administration thus being expedited into EU distribution networks. Our operational system stores all shipment documents including customs paperwork ensuring compliance and are made available to you via our customer portal. If you wished to use your own final mile carrier/s this isn’t an issue, we are still happy just to provide the custom clearance services. We do not adopt a one size fits all approach and can tailor our solutions to support as required.

Do you have an iOSS number or have

you applied for one? An iOSS number eliminates duty on low-value goods under €150. Do you have high-value goods also, no problem. UKPW can help get you registered with an EU VAT number and guide you through the process, ensuring you remain compliant along the way.

UKPW can also store all your export/Import documentation for the statutory retention period of 4-10 years should HMRC or EU customs have any future enquiry about your shipments for either tax or duty.

As well as the above UKPW will also provide you with a dedicated account manager ensuring that questions or queries can be answered expeditiously.

OPTIMISING WAREHOUSE EFFICIENCY

By Rob Gamage, Managing Editor

Warehouse efficiency plays a critical role in the success of ecommerce businesses. As online shopping continues to grow rapidly, businesses must be able to handle the increasing volume of orders efficiently and effectively.

Danny Ellard, Business Development Manager at ILG outlines:

“Ecommerce is a competitive world where fast and accurate order fulfilment is crucial to creating customer delight. Retention is critical, especially where the cost to acquire a new customer is so high. Efficient warehousing enables accurate inventory management and allows businesses to optimise their stock levels and prevent excess storage. This can lead to cost savings in multiple areas. Streamlined processes

and improved layouts minimise the time and effort required for order fulfilment and reduce labour costs.”

Analysing Current Processes

When looking to optimise warehouse efficiency, one of the first things retailers should do is analyse their current processes. Danny Ellard suggests that “retailers should focus on the following areas:

"Streamlined processes and improved layouts minimise the time and effort required for order fulfilment and reduce labour costs."

at Modern Retail

Warehouse Efficiency – Think about layout and organisation.

Efficient warehouse layouts and pick paths can accommodate higher order volumes without compromising speed or accuracy.

Continuous Improvement - By regularly reviewing performance and benchmarking against industry standards, brands can identify areas for improvement.

Stock Management and Inventory

– An efficient warehousing partner should be able to manage stock and inventory in order to optimise stock levels and prevent excess inventory in storage.

Technology and Systems - Ensure the systems the 3PL is operating on / integrating with are suitable, leveraging automation and robotics where appropriate to improve efficiency.

Returns Management - Assess the returns management process to ensure it is efficient, timely and minimises the time and effort required to process returns.

Scalability – How prepared is your current warehouse partner to scale as your business grows? The warehouse should be able to keep up with increased order volumes and growth.”

Implementing Automation

Once you’ve taken stock of your current warehouse setup, it’s time to look at the ways in which you can improve operational efficiency. One of those ways is through automation.

By automating systems, businesses can streamline processes, reduce manual labour and improve overall operational effectiveness. And there are many ways in which automation can be brought into the warehouse:

Automated inventory management ensures real-time visibility, optimised stock levels and efficient replenishment. Automated order processing minimises errors, enhances order accuracy and speeds up fulfilment.

Robotic systems and material handling solutions improve movement and transportation within the warehouse. Data analytics and machine learning enable predictive insights and continuous optimisation.

Johannes Panzer, Head of Product Strategy, Ecommerce at Descartes summarises, “In brief, using automation means you need fewer resources to process the same number of shipments, which means in reverse that retailers can in fact scale and grow their business with the existing HR resources.”

Improving Inventory Management

Proper inventory management is of critical importance in a warehouse. It ensures that retailers have accurate and real-time visibility into their stock levels, enabling them to meet customer demand effectively while avoiding the risks of stockouts or overstocking. Efficient inventory management allows businesses to optimise their storage space, reduce carrying costs, and minimise the chances of obsolete or expired inventory.

of order processes in the online shop to a Merchandise Management System (MMS) is crucial to shorten the processing of orders. To enable smart warehousing, all logistics areas – from goods receipt, storage and sorting to packaging and shipping – must be digitally networked via a Warehouse Management System (WMS).

"Investing in smarter warehouses is worthwhile even in times of recession, as it leads to more efficient processes, cost savings and greater customer satisfaction, and will likely result in larger order volumes. The use of AI and predictive analytics allows a forecast of the future ordering behaviour of customers. This allows orders to be picked and prepared for dispatch even before they are received.”

Optimising Order Picking

It also enables businesses to forecast demand accurately, plan for seasonal fluctuations, and make informed purchasing decisions. By maintaining optimal inventory levels, ecommerce warehouses can fulfil orders promptly, improve order accuracy and enhance customer satisfaction.

Edward Hutchinson, Managing Director of BITO Storage Systems suggests, “the seamless

connection

Optimising order picking is crucial for maximising efficiency and productivity. It saves time and labour costs, improves order fulfilment speed, enhances order accuracy, minimises operational costs, enables scalability and flexibility, and provides valuable data-driven insights. By streamlining the picking process, businesses can meet customer expectations, reduce errors, and stay competitive.

Johannes Panzer outlines a detailed

"Grouping together or clustering similar orders in one or in multiple batches and then picking them accordingly helps to drive efficiency"

overview of efficient order picking:

“Grouping together or clustering similar orders in one or in multiple batches and then picking them accordingly helps to drive efficiency. Here are a few examples of the various different types of picking techniques that have individual characteristics:

Single-order picking: the typical process in place when starting a business - picking one order at a time, usually with the help of a printed delivery note

Multi-order picking: a group of orders that all have something in common, e.g., size/weight, the source of the order (e.g. orders from an ecommerce marketplace whose dispatch times are subject to the SLAs of the platform), the amount of orders, a specific carrier, international destinations, requested delivery time etc.

Multi-single item order picking: ideal type of orders to segment if a high percentage of such orders is expected

Zone picking and sorting at put walls: recommended if warehouses are larger in size to keep picking routes of the team as short as possible and to decrease picking times

Tote picking (pick and sort to trolley): an excellent choice for similar-sized orders, which are picked and directly put to bin (trolley), which increases the efficiency of the process tremendously"

“If then a warehouse layout and WMS are in place, which allow the vendor to implement sorting of bin locations and racks/aisles, this setup will enable warehouse employees to make use of optimized picking paths/routes during order fulfilment.

“By implementing barcode-based processes in the warehouse, picking with mobile devices, as well as optimised picking routes in the warehouse, vendors will reduce the number of mis-picks to almost zero while boosting efficiency at the same time.”

Conclusion

Optimising warehouse efficiency is crucial to the success of ecommerce businesses. Proper inventory management ensures accurate stock levels, reduces carrying costs and improves customer satisfaction.

Implementing automation through systems like automated inventory management and order processing, robotic systems and data analytics enhances operational effectiveness and reduces labour costs.

Finally, optimising order picking further maximises efficiency by saving time, improving order accuracy and providing valuable insights. By focusing on these areas and leveraging technology, ecommerce warehouses can meet customer expectations, drive growth and maintain a competitive edge in the fast-moving ecommerce market.

CHOOSING SHIPPING PARTNERS: KEY CONSIDERATIONS FOR ECOMMERCE SUCCESS

By Rob Gamage, Managing Editor at Modern Retail

Your shipping partners will play a vital role in the success of your ecommerce business. Selecting the right shipping partners is crucial for ensuring timely and cost-effective delivery, enhancing customer satisfaction, and fostering loyalty. In this article, we take a look at the factors you should consider when choosing your shipping partners, to help you make informed decisions that align with your business goals.

Delivery Speed

Prompt delivery is a cornerstone of customer satisfaction in ecommerce. Look for shipping partners that offer a range of delivery options, including next-day or same-day delivery. By meeting customers' expectations for speedy delivery, you can cultivate a reputation for reliability and create a positive shopping experience.

Johannes Panzer, Head of Product Strategy, Ecommerce at Descartes highlights the importance of shipping partners living up to your customers’ expectations for delivery speed:

“If the retailer promises to ship within a specific timeframe, it is essential to ensure that the carrier's cut-off time aligns with this commitment. Retailers should check if the carrier's collection schedule allows them to meet their delivery promises.”

Shipping Costs

Shipping costs directly impact customer acquisition and retention. Consider different cost structures offered by shipping partners, such as flat rates, weight-based, or zonebased pricing. Striking a balance between affordability and service quality is essential. Transparent and reasonable shipping costs not only attract new customers but also contribute to their loyalty and repeat purchases.

Mike Jones, Commercial Manager at ILG outlines several cost considerations that online retailers need to consider:

“Free Delivery is becoming more challenging to achieve due to escalating costs, however, consideration should also be given to the cost of upgrading to a premium or next-day service. If client retention and repeat business is crucial to your business growth, then lifestyle courier options and cheaper alternatives may not be the appropriate choice.

“Of course, it isn’t just the cost to ship the parcel that should be a factor in making a choice. Additional surcharges apply if your freight is regarded as ‘ugly’, and any carrier will add fuel surcharges to the cost of your shipment. In some cases surcharges can be in excess of 15%, so consider your ‘all-in cost’ when reviewing potential partners.

“Usually, any good or premium service comes at a price, and this is no different when shipping partners are being considered. Ask yourself whether one or a choice of shipping partners is the best way forward. For anyone looking to purchase, variety could be the deciding factor between a completed or abandoned basket at checkout.”

Delivery Options

Offering various delivery options gives customers the flexibility they desire. Seek shipping partners that provide convenient choices like in-store pickup, locker delivery, or scheduled delivery. By accommodating different preferences, you enhance customer satisfaction while potentially reducing costs associated with missed deliveries or failed attempts.

Working with a shipping partner that can offer multiple carriers is a worthwhile consideration, as

detailed by Bobbie Ttooulis, Group Marketing Director at GFS:

“Shipping partners are an extended functionality of the retail purchase experience, and several crucial factors need to be brought into play. First and vital are the presence of choice and flexibility. Our latest study with thousands of UK consumers, Battling Basket Abandonment: Mastering Delivery Choice and Convenience for Frictionless Shopping has revealed that consumers expect a minimum of around 5 different delivery options and lack of delivery convenience is one of the top reasons for online cart abandonment.

“It’s essential to have a range of shipping services and carriers to choose from to ensure optimal service and coverage across different regions. Additionally, evaluating price points is crucial to strike a balance between costeffectiveness and quality of service. Comparing rates and understanding any additional charges or fees associated with different shipping partners is important for budgeting and profitability.

partner in contingency. We’ve seen since the pandemic and last year during strikes during Peak, how several retailers saw severe disruptions and losses. A strong

“In today’s uncertain market, the shipping partner needs to be your

delivery partner will have the power and expertise to offer up a Plan B to protect delivery so customers can have their products with minimal/no disruptions. This means, when you’re faced with a situation as many ecommerce sellers saw last year right now, you have the convenience of quickly switching carriers to avoid delays, or even planning for capacity in case of unexpected sales.

“It’s crucial that retailers make an informed decision after finding a reliable and reputable selecting shipping partner who can flex their muscles to offer the choice and services through their carriage buying power in the market.”

Tracking and Visibility

"It’s essential to have a range of shipping services and carriers to choose from to ensure optimal service and coverage across different regions"

Tracking and visibility are indispensable for a seamless customer experience. Opt for shipping partners that offer real-time tracking, email notifications, and userfriendly mobile apps. With these features, customers can effortlessly monitor the progress of their shipments, reducing anxiety and promoting confidence in your brand.

Johannes Panzer of Descartes concurs, “In general, the more transparent the post-purchase process is, the more consumers appreciate it. We work with many customers, for which a branded parcel tracking experience, via email and/or tracking website in their corporate design, is key to increasing their post-purchase brand awareness and promoting a growing number of repeat buyers.”

International Shipping

Expanding your business globally will need you to give careful consideration to international shipping. Partner with shipping carriers experienced in navigating customs clearance, tariffs, and shipping regulations. They can provide invaluable expertise and streamline the international shipping process, ultimately reducing costs and improving delivery times to delight your global customer base.

Customer Service

Customer service is a pivotal aspect of the shipping experience. Look for shipping partners that offer excellent customer support through channels

like phone support, live chat, or email. Effective and responsive customer service fosters trust, resolves issues promptly, and ultimately contributes to customer satisfaction and loyalty.

Mike Jones of ILG summarises it succinctly when he says, “In every instance, a brand or retailer should keep the end-customer in mind and consider which shipping partners will enhance the overall client experience - and which could cause reputational damage.”

Conclusion

Choosing the right shipping partners is a critical decision for ecommerce businesses. Look to prioritise factors such as delivery speed, shipping costs, delivery options, tracking and visibility, international shipping expertise, and customer service. Each of these elements significantly influences customer satisfaction, loyalty, and operational efficiency.

By conducting thorough research and aligning your shipping partners with your business needs, you can establish a reliable and efficient shipping ecosystem that drives ecommerce success.

Remember, online retail success lies, to a large degree, in the hands of your shipping partners. Make the right choice, and you can propel your business to new heights of customer satisfaction, loyalty, and growth.

SHORT-TERM SPACE IS CRITICAL TO A SUCCESSFUL WAREHOUSE STRATEGY

By Steve Purvis, Managing Director at Bis Henderson Space

Many, perhaps most, manufacturers and retailers experience pronounced peaks in their requirements for warehousing and distribution centre space. This may be part of the normal business cycle – ramping up stocks before a seasonal sales peak such as Christmas or Easter, or in advance of launching a new product or range. It may be a strategic response to unusual conditions – stockpiling goods and materials ahead of an anticipated price rise, for example. Or the need may come out of a clear blue sky: an unexpected market change leaving an overhang of unsold stock, perhaps, or supply chain disruption causing orders from the Far East all to arrive on one vessel rather than spread over several months.

Unexpected increases in stock levels may drive a frantic search for emergency temporary accommodation. But there is an argument to be made that the use of temporary or short-term warehousing should be part of the

firm’s normal tactical and indeed strategic response to ever-changing conditions.

It can very rarely make much sense for an organisation to scale its permanent warehouse space provision around the highest peaks of demand. Quite apart from the significant fixed costs of owning or leasing, equipping and servicing, space only to have it operate for much of the year with relatively low productivity, the days when the warehouse labour force could readily be ramped up and down are long gone. And in these days of extreme uncertainty – supply and shipping disruptions, the continuing aftermath of Covid, high inflation threatening recession, the Ukraine and Russia war – it is a brave organisation that commits resources for the typical multi-year leasing term.

The alternative is for companies to embrace temporary or short-term space as part of their considered, long-term warehousing and

distribution strategy. But is that realistic? Surely all available space is being snapped up by online retailers?

That isn’t actually the case. Colliers, the agents, report that in 2022 the shape of the warehousing market has largely reverted to its pre-Covid pattern. Certainly, the online retailers took 33% of new leases in 2020, and 45% in 2021, but last year they were just 11% of what has proved to be a remarkably resilient market (and indeed, Amazon and others are showing some signs of retrenchment), while 3PLs took 43%, followed by retailers/wholesalers on 19%, and manufacturers on 16%.

Furthermore, retailers, in particular, are releasing space by reducing stocks as part of their response to the cost-of-living crisis: major supermarket chains, for example, are reducing the number of SKUs they carry by 5% or more: that ripples back up the supply chain and means there are an awful lot of unused pallet spaces becoming available. And as always, there are many warehouse operators that have scaled for their peaks, and are

more than happy to warehouse for other parties during their ’offseason’.

The offer isn’t just a room on the shed floor. Increasingly we can offer retailers short-term managed storage solutions and warehousing–as–a–service. This is becoming a keen and competitive market with significant benefits for suppliers and space users. It allows the former to get the best value from their assets through creating an additional revenue stream and the latter to avoid long-term commitment to lowreturn investment.

So, we would urge retailers, wholesalers and manufacturers to consider using these short-term sources of productive warehouse capacity as an integral component of their warehousing strategy. Clearly, this is easier for planned peaks such as seasonalities or product launches, but often it is possible to identify the early signs of some of the lessexpected events and disruptions and plan accordingly. And even where a peak requirement has blown up quite without warning, the robust strategy will have plans and routines, and the business relationships, that will guide the business swiftly and affordably to an appropriate warehousing solution.

Bis Henderson Space has many years of experience in this market. We can help convert your short-term space requirements from a firefighting

emergency to a considered tactical response as part of your wider warehousing/fulfilment strategy.

If you’d like to learn more please contact Rob McWriter, Business Development Director at Bis Henderson Space on rob.mcwriter@bis-henderson.com or 07836 572500.

Bis Henderson Space specialises in helping businesses access additional warehouse space and operational services quickly and effectively by matching them with businesses that have spare capacity in their warehouse or by finding longer-term alternative property solutions. Able to deploy complex solutions at pace, negotiating flexible contracts specifically tailored to their customers’ requirements.