E-Commerce and Logistics Relationship

E-Commerce and Logistics Relationship
The relationship between e-commerce and logistics can be seen in more ways than ever before. More than ever, retail businesses must invest in distribution centers and warehouses to cope with the high demand from modern e-commerce channels. Such an investment will also help accelerate the design, development and implementation of logistics and supply chain processes. Cutting-edge technologies such as advanced robotics, augmented reality and drones are helping companies stay competitive, meet customer needs and reduce operating costs. Read on to learn how logistics works in the modern e-commerce environment.

What is Logistics in E-commerce?

Generally speaking, for the question of what is logistics in e-commerce, logistics involves the management of products or resources in storage and shipping. Applied to e-commerce, the process enables businesses to ship orders to customers. If you run an e-commerce site, you will come across the term logistics management. As a retailer, your role in logistics management is to identify potential shipping and distribution companies and evaluate their effectiveness. Most businesses prefer logistics to third-party companies equipped for the storage and transportation of goods.

How Do Logistics and Modern E-commerce Intersect?

One of the prerequisites for running an e-commerce business is to master the basics of logistics. Modern businesses, whatever their size, increasingly rely on back-end supply chain management to keep their operations afloat. If your business doesn’t have a real-site facility for residential inventory, the best thing to do is seek help from third-party logistics providers. Outsourced assistance will ensure that your business operations run smoothly without having to worry about storing and shipping products.

What is the Logistics Process for a Typical Business?

Small businesses follow a simple logistics process when they have goods that need shipping or storage. The process usually starts with a customer ordering a product at your online store and continues with inventory software that triggers the transaction. It is becoming more and more important to have an integrated inventory management software installed on your e-commerce site in order for the logistics process to be smooth.bIn online businesses, logistics typically encompasses the following processes:

Inventory Management

Inventory management involves using appropriate methods to keep track of stored goods. With this procedure, it is easier for your digital store to monitor stocks. You can also predict products that have higher sales force than others. The rationale behind inventory management is that businesses make sure they don’t run out of products unexpectedly. Customers’ buying trends can help you predict how your products will sell in the near future.


Warehousing is a logistics procedure involving physical stores that businesses use to store, manage and track products that have not yet been shipped to customers. Over the years, there have been great developments in the field of storage. Many of these developments make it easier for e-commerce players to use storage management systems to track inventory. Traditional storage management techniques are time-consuming and costly to implement.

Order Fulfillment

Order fulfillment is seen as one of the most important elements of both logistics and e-commerce. This critical procedure ensures that customers receive their orders on time and in good condition. Your business may obtain this service from a third-party provider or invest in an in-house fulfillment service. The customer’s location, job size and order quantity will determine which route to follow.

Is It ossible To Track Goods Stored or Transported in Backend?

As logistics become more complex and dependent on digital technology, businesses are now leveraging a variety of options to track inventory in their supply chain. Inventory management software can update you on the number of items left on your online shelves when uploaded to your e-commerce site. With this information, it’s easier to stay productive as an online seller and conveniently fulfill customers’ orders. If you have partnered with services such as USPS, FedEx or UPS, it is possible to track goods using the fulfillment numbers provided by the relevant shipping company. It’s a good idea to track orders to make sure they reach customers. Providing your customers with the same tracking information in their confirmation emails can help clear up uncertainties about order fulfillment. 

Challenges Faced By E-commerce Logistics

While logistics has proven incredibly useful for e-commerce players, it does face several challenges. Even if your business is facing e-commerce logistics issues, your customers will expect product storage and shipping processes to be seamless. As these challenges arise, it’s a good idea to retain your trusted customers and stay relevant to your business. Problems your online store may encounter with e-commerce logistics include:

Resources for Same Day Delivery

While e-commerce giants like Amazon facilitate same-day deliveries, other e-commerce sites (both small and large) want to do the same. Same-day deliveries are suitable for online retailers if they have the resources to facilitate faster logistics and fulfillment. Your business may want to stay competitive by shipping products to customers on the same day they are ordered. It can be frustrating if you don’t have the necessary resources to make the service a reality.

Identity Thieves

Identity thieves create great distrust for consumers. Consumers increasingly rely on online shopping sites to offer them a wide range of services and products because of the convenience they enjoy. One of the challenges of e-commerce, identity theft, makes it difficult for consumers to enjoy the convenience of online shopping. It can be upsetting for your business if your customers’ credit card information is stolen while they are trying to purchase a product on your site. The customer will have to leave their shopping cart unattended as they can no longer transact with your business. Cases of identity theft on e-commerce sites also harm the logistics process in the long run because consumers have difficulty purchasing an order and do not enjoy fulfilling it.

Free Shipping Costs

Online retailers are increasingly offering free shipping as a way to encourage consumers to buy more products. What most people don’t know is that providing such a service actually costs a retailer. If your business works with a third-party logistics provider, you’ll have to cover the costs yourself because they offer free shipping. Since some businesses do not include the shipping cost in their product prices, they incur losses after applying the free shipping incentive.
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