Posts written by

Rahul Kumar

Rahul Kumar worked as a content marketing analyst at WareIQ contributing to blog posts related to eCommerce operations, fulfillment and shipping along with a few topics around tips and tricks for eCommerce sellers. He has more than 3 years of content writing experience across industries like logistics & supply chain, media etc.

10 Best Tips to Write Better Product Descriptions and Increase Online Conversions in 2024

A deal, advertisement, or marketing can only be successful when your customers understand the message. You need to write product descriptions in a simple and attractive way so that when a customer comes to your product page, the message will resonate with them and they will consider buying it. Thus, you need eCommerce product descriptions that will communicate with visitors and answer frequently asked questions related to your product. Providing good product descriptions should be just as important as the quality of your website or the quality of your product's images. Not only does it enhance the online consumer experience, but it also adds credibility to your business, raises the ranking of your online store, and increases the number of people that convert to your website. Let us look at the best strategies to attract customers to your online business with persuasive product descriptions. What are Product Descriptions? A product description is a marketing paragraph that describes a product's features and benefits and emphasizes its unique selling proposition (USP). A product description's main goal is to persuade people to buy the product by giving them all the important details about its qualities and advantages of it. However, creating product descriptions that merely explain your products as a supplement to product pictures is a common mistake that occurs frequently. This mistake can be made by business owners, marketers, and even expert copywriters. A solid product description not only sells your products to actual customers but also provides additional optimization for search engines. [contactus_gynoveda] Benefits of Product Descriptions for Online Buyers Are you aware that your SEO could be impacted by your product reviews? Your product reviews may wind up showing up in Google searches, particularly in Google Shopping, if you use review services. They can significantly boost website visitors. Effective product descriptions can increase conversions, establish your brand image, increase credibility and enhance the SEO capabilities of your website. To understand this point, imagine how absurd it would look if a product listing has no product description examples. A buyer will have doubts about the authenticity of the product as well as the availability. Product details help buyers in the following ways: They will be redirected to the exact product they are searching forThey will get to know the available size, colours, fittings, etc.It lists down all the features in an easy-to-view wayThey can understand the use cases for the product and tips for better decision makingThey can use this information to compare it with other productsIt works as a user guideIt enhances the available insight about the product Sample Product Description Suggested Article: How to Effectively Start an Online Business? 10 Tips to Write Better eCommerce Product Descriptions to Sell More and Sell Faster in 2024 Highlight the Features and Benefits We become passionate about certain product features and specs when we market our own products. We are completely devoted to our business, website and offerings. The issue is that our prospective customers are not as interested in unimportant features and specifications. They want to know how it will satisfy their demands and what benefits they can expect. You must therefore emphasize the advantages of each feature. Sell an experience rather than a product. Understand Your Ideal Buyers When you write eCommerce product descriptions with a large number of potential customers in mind, your descriptions end up being vague and addressing no one in particular. The finest product descriptions speak immediately and personally to your target market. You converse with them by posing questions and providing answers in this way. Address them directly with words like “you”. Start by picturing your ideal customer while creating your own product descriptions. What sort of trend do they find enjoyable? What phrases do they use? What phrases irritate them? Do they accept phrases like "sucky" and "crappy"? What inquiries do they make that you ought to respond to? Think about how you would communicate with your ideal customer if you were selling your goods in person in a store. Try incorporating that language into your eCommerce site so you can have a more meaningful dialogue of that nature there. Use Common and Relatable Words In general, lengthy product descriptions are not required. The product description examples that you can use depend on the type of product you are describing and the list of features that it has. However, you should generally try to keep product descriptions concise and simple to read. This is where bullet points can be quite helpful. The facts about the material, available colours and size options are some of the significant features that can be noted in bullet points. Keep in mind that users may occasionally only read the bullet points and ignore the rest of the description. It is crucial to draw attention to the most significant qualities and advantages in your product descriptions. Appeal to the Imagination of Buyers According to scientific studies, holding a product in your hands makes you want to buy it more. Since you're selling online, your customers can't physically see or hold your goods. Additionally, there is a copywriting technique to increase desire - have your reader visualize what it would be like to own your goods. This can be done by using large, clear photographs or exciting language. Start your paragraph with the word “imagine” to use this copywriting strategy and then describe how you imagine the reader would feel after purchasing and using your product. Use Small Storytelling Techniques Think about if there is any relatable backstory of your product that holds any special meaning for you before writing your product descriptions. There's a good chance that your audience will find it to be especially unique, lovable, and memorable. Use that tale in your eCommerce product descriptions to give it more personality, draw customers in and win them over. Use Superlatives of Powerful Words You can convincingly demonstrate why your product is the best, simplest or most sophisticated by using superlatives and powerful words. As Amazon explains, “the Kindle Paperwhite is the most sophisticated, patented e-reader in the world”. The reader gets the impression that this is something remarkable because of the phrase "patented." Going along with product description examples like this, Amazon claims that “Paperwhite boasts higher contrast and spectacular resolution” and Amazon goes on to provide various percentages to support this claim, as well as one crucial benefit: “Paperwhite provides glare-free, clear, crisp text and images even in direct sunshine.” Add Facts and Figures Never boast about your product or give wrong information. It may skyrocket your product sales for a while but it will never work in the long term and can ruin your brand reputation and generate negative feedback from unhappy customers. Always try to give facts and figures to support what is mentioned in the product description examples. Numbers in bullet points always appear immediately on the first look and make a mark on the viewer. Utilize a Specific Format When the product description has a clean, scannable design, your product descriptions will be easier to read and be more appealing to potential customers. When creating your product description, consider the following areas: Use headlines to draw website visitors inUtilize scannable bullet pointsProvide lots of white spaceEnlarge your font to improve readability. Use SEO to Make it More Visible Online It is crucial to keep your keywords in mind, even though this will probably happen naturally if you create a decent product description. Using the appropriate keywords will assist your sites to move up in the search results from the perspective of search engine optimization (SEO). In addition to enhancing trustworthiness, gathering and showing customer feedback has SEO advantages for your product pages. Consider that easily searchable keywords from an SEO standpoint will have a huge positive impact on your page. The main advantages are: Includes pertinent keyword phrases on your product pagesProvides regular "new content" updates to your product pages Use Good Quality Images & Videos The greatest approach to describe your goods isn't usually through text. Consider how you can simplify your writing if it starts to grow overly wordy. Customers are more likely to retain information when it comes to visual representations. If at all feasible, showcase your product in a visual way that demonstrates how it works. Even though they typically lack words, images do provide answers to customer questions. Include as many details about the many applications and perspectives of your product as you can in the pictures. Keeping this in mind, take care that the quality of the image of the video is good otherwise it will reflect poorly on your business. Conclusion The above advice will help you create eCommerce product descriptions that encourage customers to buy from your eCommerce company. Connecting with customers through language and imagery when they are unable to physically connect with your products can make the difference between them just browsing online and actually completing a purchase. If you need assistance with fulfilling orders that are the result of enhancing your product descriptions, consider partnering with WareIQ. WareIQ integrates with multiple selling applications through our custom WMS Software such as Amazon, Flipkart, eBay and more, and also has facilities such as a nationwide network of fulfillment centers, a custom app store, partnerships with more than 20 shipping carriers, and more. Your customers can keep up to date with their orders through our branded tracking pages and you can check on your inventory through real-time updates. [signup] Product Descriptions: FAQs How do you write a marketing description?Create an overview of what your company does first. Then, describe your justification for selecting this market, including any favourable market trends, fewer taxes or a lack of competition. Why are product descriptions important?Customer decision-making is aided by product descriptions as it would be foolish to simply display products and their prices without providing the customer with any information about them. They also help your website look professional. What are product descriptions?A product description is a marketing phrase that is used to describe and clarify the advantages of your product. In other words, it displays all of your product's information and specifications on your eCommerce site. This product information may consist of a single sentence, a brief paragraph or bullet points. They may be sombre, humorous, or eccentric.

August 13, 2022

Contract Logistics Vs 3PL: 6 Key Differences and How to Choose The Right Outsourcing Option for Your Online Business in 2024

Due to the expansion of on-demand logistics, contract logistics have quickly developed. However, they are frequently mistaken for 3PLs, which provide a different range of services that focus on multiple aspects of eCommerce. Despite the fact that some people use these words interchangeably, they mean very distinct things in practice. A contract logistics firm could be an excellent option for your eCommerce store if you're seeking someone to manage a certain area of your supply chain while you handle the rest. On the other hand, you should take another alternative i.e., 3PLs into consideration, if you want to outsource a significantly larger portion of your shipping and fulfillment operations. In this blog, we will look at the differences between contract logistics vs 3PL and what suits your business the best. What is Contract Logistics? Contract logistics firms, also referred to as consultants or freight forwarding companies, have areas of expertise ranging from the manufacturing line to delivery management. The term "contract logistics company" is typically used to refer to a freight forwarder. They are just experts in transporting cargo. They will be in charge of things like shipping, finishing up the necessary paperwork and customs clearance. Contract Logistics Process Contract logistics often assist with the administration of domestic and international transportation rather than shipping, inventory management, or fulfillment. For instance, they serve as a middleman between shipping firms and online retailers and guarantee that products are delivered to the appropriate locations across the supply chain. [contactus_lilgoodness] Contract Logistics in Today’s eCommerce Market Contract logistics is mainly used by big market players who already have a vast supply chain network serving hundreds of people in the eCommerce ecosystem. They use it mainly for bulk product transportation from one warehouse to another. In today's eCommerce environment, contract logistics companies operate by organizing, managing, and planning transportation requirements. Since they maintain tight relationships with significant freight carriers, they are able to bargain for lower transportation costs which benefit merchants. Additionally, they assist in route planning that is optimized for better shipping speed at a lower cost. According to Verified Market Research, the Contract Logistics Market was valued at USD 203.40 billion in 2018 and is anticipated to increase at a CAGR of 4.80 percent from 2019 to 2026 to reach USD 296.52 billion. 6 Key Differences Between Contract Logistics vs 3PL A 3PL company handles much more than just transportation; 3PLs offer a full range of ecommerce logistics services from warehousing and order fulfillment to inventory management and automated shipping. While contract logistics companies typically help arrange transportation and routes, a 3PL company handles much more than just transportation management. Since many 3PLs run numerous distribution centers, sellers can: View current inventory levels in real-timeDistribute inventory among distribution facilitiesDistribute stock in accordance with demand In order to enable an end-to-end eCommerce solution, 3PLs offer flexibility, visibility into the eCommerce supply chain, and technology connections with eCommerce solutions from inventory planning to freight delivery. While a 3PL normally provides transportation for orders after they are fulfilled through the carriers directly, a contract logistics business may help manage the transportation to get bulk inventory to a 3PL from a manufacturer. The comparison between contract logistics vs 3PL is shown in the table below: [table id=45 /] Contract Logistics vs 3PL: How to Choose the Right Outsourcing Option for Your Business in 2024? Contract Logistics A contract logistics agreement may be utilized for one-off services or for the precise step of the supply chain you need assistance with, depending on the specific services required, the size of your organization and your budget. If you are willing to handle everything else yourself, including picking and packaging orders, tracking them, keeping track of your own inventory, and managing warehouse procedures, it can be beneficial to work with a contract logistics firm. A contract logistics company is the best option for you if you have the time to market your company and manage other processes involved with order fulfillment. 3PL You should use a 3PL company's order fulfillment services if you discover that managing your business and marketing takes up the majority of your time and you are not able to handle everything together. You don't have to worry as much about logistics operations which enables you to save time while growing your supply chain because 3PLs provide a wide range of solutions to help with supply chain efficiency. Additionally, 3PLs offer the infrastructure, technology, experience, and support you need to maintain your position in the market and satisfy customer demand for quick and low-cost delivery, all of which contribute to your bottom line. Conclusion: Why Should You Choose WareIQ as Your 3PL Partner? Your capacity to handle logistics and provide excellent customer service varies depending on the choice of contract logistics vs 3PL. Giving someone access to critical data like sales, inventory and other statistics carries a big risk. Startups in the fields of on-demand and cloud-based warehousing are becoming more and more well-known as eCommerce takes off. Instead of signing long-term leases for a set location, businesses can use the storage space according to seasonal demand. For retailers that require more assistance in other parts of their eCommerce operations, they are better suited in partnering with a 3PL company like WareIQ. WareIQ gives you many more facilities than contract logistics companies including order fulfillment, last-mile delivery, a custom WMS to manage orders and integrate with multiple eCommerce platforms, a nationwide network of fulfillment centers, choice of multiple shipping partners, ultra-fast delivery and much more. Online firms have a lot of space to expand with WareIQ since they get access to a strong fulfillment infrastructure, a team of logistics professionals, and a dedicated customer support team. We also make it simple for you to get onboarded. Once you make use of our services, online orders are automatically dispatched to the closest fulfillment center to be picked up, packed, and shipped as soon as they are placed which saves you time, resources, and extra delivery changes. [signup] Contract Logistics vs 3PL: FAQs What is the difference between contract logistics and freight forwarding?A freight forwarder serves as an expert in the supply chain link rather than moving products whereas contract logistics are companies that can be contracted frequently to move products with shipping lines. What are 3PL & 4PL logistics?From warehouse to shipping, a 3PL (third-party logistics) company handles every element of fulfillment. A 4PL (fourth-party logistics) service provider oversees a 3PL on behalf of the client and other supply chain components. What is contract logistics and why do companies use it?Contract logistics is the outsourcing of logistics and supply chain management tasks to a third-party provider. Companies use contract logistics to reduce costs, improve efficiency, and gain access to specialized logistics expertise and technology. What services are typically included in contract logistics?Contract logistics services can include warehousing and distribution, transportation management, inventory management, packaging and assembly, and reverse logistics. Some providers may also offer additional services such as customs clearance, freight forwarding, and order fulfillment. How do companies choose a contract logistics provider?Choosing a contract logistics provider depends on the company's specific needs and goals. Factors to consider when selecting a provider include the provider's experience and expertise in the company's industry, its network of facilities and transportation resources, its technology and automation capabilities, and its ability to meet the company's service level and cost requirements. Is contract logistics the same as 3PL?A 3PL company handles much more than just transportation; 3PLs offer a full range of logistics services, from warehousing and order fulfillment to inventory management and automated shipping. While contract logistic companies typically help arrange transportation and routes, a 3PL company provides many more fulfillment services.

August 08, 2022

Retail Logistics: Definition, Functions, Challenges and Methods to Improve Retail and Logistics Management in eCommerce in 2024

Buyers these days expect a quick and good experience with any brand. They expect customizable products with similar delivery options that use advanced automation of logistics processes. Technology has made this possible. Nowadays, there are many different products on the market and this calls for a planned strategy from the point of receiving an order to the point of delivery. By using effective retail logistics and added value, you can make sure that everything is in place to provide better delivery and service at reduced costs. In this blog, we will take a look at retail logistics, its advantages, and how retail and logistics management can be improved. What is Retail Logistics? Retail logistics is the systematic process of controlling the movement of goods from the point of supply to the buyer. By using effective retail and logistics management, you can make sure everything is set up to provide better delivery and service at reduced costs. The warehouse receiving, inventory management, fulfillment and shipping phases are parts of the retail logistics process. In order to achieve customer expectations for quick, economical delivery, every step of the logistics process should be streamlined. This means that an efficient retail logistics operation frequently needs both manpower (warehouse personnel as well as upper-level management positions, such as a logistics director) and slick software solutions, which can dramatically raise logistics expenses. [contactus_uth] Source 6 Functions of Retail Logistics in eCommerce Inventory Handling To fulfill orders, your products must be received and processed from the supplier. Incoming eCommerce goods are unloaded and formally checked in, after which it is properly documented and stored. Receiving and processing inventory is crucial. It not only promotes effectiveness and expedites the fulfillment process but it also guarantees that what is received corresponds to what was purchased. A lack of clear protocols can easily result in loss, which has an effect on both your customers and your bottom line. Examples of such operations include unloading, receiving and allocating SKUs. Inventory Distribution Distributed inventory is a method of allocating inventory where stock is distributed among several warehouses or fulfillment locations as opposed to just one. This system's basic premise is that it brings your goods closer to your clients, making it one of the best ways to speed up delivery times and lower transportation costs. The price of satisfying retail orders depends on delivery zones so thus, the closer a shipment is to the buyer, the less the retail logistics will cost them. An example would be an Uber ride, where distance corresponds with increasing costs. Distributing inventory throughout many retail warehouses can help your business grow by enabling you to provide low-cost 2-day shipping which is a benefit that many customers have come to expect as a result of online retailers like Amazon. In an economy that depends on quick fulfillment. Many rapidly expanding firms outsource fulfillment to a 3PL like WareIQ, which runs a vast network of fulfillment centers because they lack the time or resources to manage several warehouses. Order Fulfillment Don't undervalue the importance of quick and economical delivery to customers. It is essential to have a strategy in place for cost-effective and efficient retail logistics. A variety of coordinated procedures begin as soon as your customer confirms their order, ensuring that their information is verified and the appropriate products are selected and packaged as soon as possible. The procedure is referred to as "order-to-cash" (O2C). In order to complete the order and collect payments from the client, inventory management and accounting procedures must be completed within the O2C cycle. To track orders and save historical order data, which is later used to evaluate O2C performance, a healthy O2C cycle also needs an order management system. The order processing and fulfillment process can be automated if you work with a 3PL like WareIQ. Orders are routed from the closest fulfillment facility to the shipping destination once your online store is connected to WareIQ's fulfillment platform. Shipping An order is dispatched as soon as it has been picked, packed and labelled. If your retail logistics network includes numerous warehouses, the shipment is transported from the one that is closest to the destination. eCommerce shipping entails setting up orders to be delivered to the customer in the most dependable, economical manner possible. Shipping incentives, such as free shipping and same-day and next-day delivery can effectively be employed as marketing strategies. You can leverage product bundles, provide minimum spending requirements, partner with 3PLs that handle shipping and offer negotiated bulk shipping rates and pass on the savings to your consumers to help cover the cost of shipping (including free delivery). Product Tracking It is important to have real-time retail logistics tracking in place across the whole eCommerce supply chain. Maintaining ideal inventory levels and determining when to replace inventory to fulfill demand without overstocking and raising holding costs can be difficult without real-time tracking of product levels. You can track orders and shipments using digital order tracking and you can also give your customers tracking details. For example, using the WareIQ app that integrates with your choice of eCommerce platform, you can automatically send each customer a confirmation email and provide them with the tracking number and related details. You can view the order's status in real-time as it goes through each stage, from processing to shipment and everything in between. Returns Management If not effectively handled, the returns management process can include additional receiving, packaging, evaluation, reprocessing and even replacements. Returns can be seen as a chance to improve the client experience even more. A fantastic method to improve the customer experience is to train your customer support employees to initiate returns while simultaneously soliciting client feedback. Overall, implementing retail logistics solutions that speed up returns can significantly affect the expansion of your organization. Common Challenges in Retail Logistics in 2024 Rising Consumer Expectations The conveniences that the modern customer has grown accustomed to, particularly when it comes to shipping, have a direct impact on their shopping decisions. According to National Retail Federation research, 3/4ths of consumers want delivery to be free but in another survey, 77% of consumers showed that they are willing to pay more for next-day or same-day delivery. Two-day shipping was originally offered by eCommerce giant Amazon more than 15 years ago and it swiftly became the norm. Since then, Amazon has narrowed the time frame for its deliveries, obliging all other sellers to do the same. Lack of Inventory Visibility Even the most effective retail fulfillment strategy can be hampered by a lack of inventory visibility, both in terms of the overall number of SKUs and where inventory is situated. Fortunately, this problem with retail logistics has two rather simple remedies: First, companies must keep an eye on inventory numbers. There are a variety of measures you may use to obtain visibility into your inventory, including inventory carrying costs, successful order percentages, percentages of orders filled from ideal inventory locations and inventory turnover rates. For the best return on investment (ROI), make sure that any metrics or key performance indicators (KPIs) you track are in line with the strategic, financial and customer goals of your business.Second, create a WMS-based retail fulfillment process that is effective. WMS technology has many advantages, such as improved workflow and process design, interaction with purchase order systems and tracking SKU levels at the lot, and much more. It can even enable inventory metrics through KPI generation and customized reporting. To provide your customers with seamless omnichannel experiences and want to attain inventory visibility, you can use it as an accurate forecast of future demand and manage your supply-chain activities accordingly. Complex Disruptions in the Supply Chain Global and local supply chains are very complex. While expanding retail logistics operations across the country has helped many businesses cut expenses, diversify their product lines, increase production efficiency and more, it has also increased the danger of supply chain interruptions, caused due to a variety of factors such as manufacturing issues, transport issues, unforeseen delays and much more. Impact of Retail Logistics in eCommerce In changing times a lot of changes have been seen in eCommerce due to Retail Logistics. A few of them are: Growth of Mobile Commerce It comes as no surprise that there has been a considerable shift to mobile commerce given the broad adoption of smartphones. More people are now purchasing online due to the temporary closure of brick and mortar stores worldwide to stop the spread of COVID-19 and the avoidance of those stores by many customers who chose to adopt social distancing. EMarketer reports that 43% of online retailers experienced an increase in sales during the pandemic. Electronics, home goods and office supplies, which boost comfort and allow individuals to achieve more while at home, saw a dramatic increase in demand, whilst non-essentials like jewellery and consulting services saw a decline in demand as consumers decreased spending on non-essential needs. Enhanced Consumer Expectations A seamless and uniform experience across channels, including online, mobile and in-person, is what savvy customers are starting to demand from their favourite companies as they move toward omnichannel retail logistics experiences. The omnichannel strategy, for instance, allows customers to return items they have purchased online to any brick-and-mortar store, regardless of where they originally bought them. Retail logistics can become very challenging for businesses that segregate their online inventory from their in-store goods, especially if their distribution hubs are spread out throughout the country. Technological Integration Another significant trend that is having an impact on retail logistics is embedded integration technology, as logistics providers are realizing the necessity for reliable and seamless data sharing with customers. For example, Delivery windows can be optimized using real-time position tracking and real-time traffic information. Embedded data platforms enable the connection and integration of data by utilizing features that are already included in the solution. RFID technology is yet another illustration. RFID can provide real-time location and amount data when coupled with other systems, such as inventory management software, leading to fewer backorders and more precise estimations of delivery timelines and shipping costs. Adopting embedded integration technologies enables merchants to more effectively track inventory, communicate with customers in meaningful ways and share data throughout their supply chains. Increased Automation The retail logistics sector is already changing thanks to robotics. Particularly, the collaborative robot is making great strides in streamlining and optimizing warehouse, order fulfillment and delivery processes. Given that the retail sector undergoes large seasonal peak periods, collaborative robots are particularly appealing for distribution and fulfillment in the retail sector. Warehouse operators can rent more robots to meet seasonal demands and return them after peak time because collaborative robots don't need new infrastructure. Robotization has come to be associated with automated warehouses and improved order fulfillment and distribution processes, whether it is through collaborative or multipurpose robots, driverless cars or wearable technologies. The use of robots in retail and logistics management will increase as technology gets more precise, adaptable and affordable. 3 Ways to Improve Your Retail and Logistics Management Every product you offer will face intense competition in the online market. Traditional logistics systems can't keep up with client demand for efficiency and labour cost savings. You need the appropriate partners and technology on your side in order to build a strong retail logistics business. Here are 3 ways that can help: Enabling Digitalization The capacity to transform retail logistics into the digital world is necessary for supply chain optimization in order to maintain competitiveness and satisfy demand. Traditional supply chain management methods are improved by digital supply chain transformation using the most recent advancements in logistics including automation, data and analytics, robotics and AI learning. The objective is to build a quicker, more durable and sustainable supply chain. Digital inventory solutions may assist multichannel shopping, enabling firms to grow across channels while maintaining complete visibility of their supply chain. Increased order accuracy, quicker fulfillment and the capacity to trace inventory across distribution centers are all benefits of integrating a digital inventory system with a warehouse automation system or 3PL software. Choosing Third-Party Retail Logistics Providers Online merchants frequently resort to contemporary logistics partners when they want to expand for a number of reasons: In-house fulfillment gets time-consuming and expensive as a brand expands.Brands eventually run out of room or can't keep up with demand because of a manpower shortage.There isn't enough time for business owners and their staff to concentrate on direct-revenue efforts.Offloading retail logistics to outside logistics centers or parties who put a priority on lowering costs and accelerating efficiency can provide your company with a significant competitive edge. Streamlining Your Technical Stack Online sellers can expand most effectively when their operations are automated to function as effectively as possible. Your company's operations can be maintained by improving the integration of your retail logistics tech stack. WareIQ collaborates with top end-to-end eCommerce providers, including platforms for returns and marketing tools, to develop a unique retail logistics solution that fits your business. Conclusion: Enhance Your Retail Logistics With WareIQ Retail logistics are extremely important for an eCommerce business in 2024 as it ensures the smooth transportation of goods from the manufacturer to the fulfillment center and ultimately, to the customer. However, it can be very complex for businesses to manage it on their own. We recommend outsourcing your retail logistics to a 3PL company like WareIQ. WareIQ is designed to make your retail logistics procedures easy and cost-efficient. You as a seller can offer services such as same-day or next-day delivery, a nationwide network of fulfillment centers and dark stores to store your products closer to your customers, choice of more than 20 shipping aggregators that are automatically assigned to each order based on their delivery speed and cost and much more. Furthermore, WareIQ's B2B and BSC fulfillment suite and WMS capabilities enable sellers to sell throughout the entire eCommerce ecosystem, powering retail logistics and assisting in the fulfillment of website orders. Unlock your successful eCommerce journey with WareIQ by cutting down expenses on product procurement and fulfillment. We will provide you with everything you need to maintain a robust supply chain while also freeing up your time to concentrate on expanding your business. Retail Logistics: Frequently Asked Questions (FAQs) Why is logistics important for the retail industry?A successful retail business depends on its logistics and supply chain. Everything revolves around giving people what they want, when they want and at their convenience. The key to success is winning over customers' confidence and helping businesses grow their operations daily. What are the five elements of retail logistics?The elements of retail logistics are:a) Storage, warehousing and materials handlingb) Packaging and unitisationc) Inventoryd) Transporte) Information and control What are the different types of retail logistics?Industry-wise logistics can be divided into five categories:a) Procurement Logisticsb) Sales Logisticsc) Manufacturing Logisticsd) Recovery Logisticse) Recycling Logistics How does retail logistics differ from other types of logistics?While retail logistics is similar to other types of logistics, there are some key differences. One of the main differences is that retail logistics focuses specifically on getting products from suppliers to customers through retailers, whereas other types of logistics may focus on different types of goods or different stages of the supply chain. Additionally, retail logistics often involves a greater number of SKUs (stock keeping units), small quantities and more frequent deliveries compared to other types of logistics. Retail logistics also has to deal with reverse logistics (Returns) and last mile delivery that may not be as prevalent in other types of logistics. What is a logistics cycle?The logistics management cycle includes important tasks including product selection, quantification, procurement, inventory management, storage and distribution. Organizing and staffing, finance, supervision, and assessment are other tasks that contribute to and are fundamental to the logistics cycle. What are some examples of well-known companies that excel in retail logistics?To name the best;1. Amazon Logistics2. Walmart3. DHL4. FedEx5. WareIQ

August 07, 2022

First Mile Delivery: A Detailed Guide Including Definition, Importance, Challenges and Tips for Optimising First Mile Logistics in 2024

Many rapidly expanding online merchants struggle with the ongoing balancing act of providing clients with a great delivery experience. In the process of offering smooth and hassle-free deliveries, if a business is paying too much in shipping costs, it can majorly reduce profit margins. What if it was possible to enhance the delivery experience at a more early stage of the eCommerce supply chain? It turns out that your shipping experience is directly impacted by the first mile delivery stage and optimizing it will result in significant downstream gains. In the article, we will learn the advantages and challenges of first mile delivery, its importance and tactics to improve it. What is First Mile Delivery? First mile delivery refers to the transportation of goods from a merchant’s premises or warehouse in the supply chain to the next location where the goods are stored and distributed from there. But for various supply chains and businesses, the first mile delivery could signify different things. For a retailer, this can entail shipping goods from a local distribution center or storefronts to a regional warehouse. For logistics companies, this could be a service of picking up goods. First mile delivery is used by eCommerce businesses where products are picked up from a merchant and then passed to third-party logistics or courier service to be delivered to the end-user (Buyer). [contactus_gynoveda] Importance of First Mile Logistics in eCommerce First mile delivery, which is the first step in the supply chain, has a significant influence on how a company handles retail fulfillment. Ineffective first mile delivery can slow down last-mile delivery by affecting the supply chain throughout the fulfillment stage. Some of these inefficiencies frequently have their origins in incorrect purchase order decisions. If production is delayed or an incorrect amount of inventory is delivered, it is enough to throw off the remainder of your supply chain, especially if you are receiving orders that depend on the arrival of the upcoming shipment of stock. By identifying ways to increase visibility, diversify your supplier network and implement a robust warehouse receiving process, many problems that arise during first mile logistics can be resolved. Tactics to Optimise First Mile Delivery Processes source Choose a Tech-Enabled Fulfillment Company There is always the option of handling first mile logistics on your own but if you're ordering a lot of products and handling a lot of orders, you're going to need the room and the assistance of a professional. You can choose which parts of a 3PL's warehouse network to keep products in when you first begin working with them. You can request direct delivery of merchandise from your supplier to the fulfillment center, where logistics professionals will carry out a careful inventory check to make sure the purchased items match the paperwork. WMS software is built to make sure you have the information you need so everything is accounted for and correctly stored, in order to guarantee the completion of flawless first mile delivery. After receiving inventory, you can monitor the flow of it in real-time on the dashboard. You can access inventory records, calculate the best time to replenish inventory and create automation reorder notifications when inventory is running low because all inventory and order data is consolidated in one location. Analyze the Supply Chain Process Making a map of your supply chain starting with first mile delivery is a good method to improve it. You may find the inefficiencies in your current supply chain and the measures required to optimize and improve processes by carefully looking over each step of it. The manual process is labour-intensive and subject to human mistakes. If you are at this stage, you should think about automation and other supply chain technologies to lessen the human factor involved in reordering goods and also to reduce errors. Make a Warehousing Strategy Creating a thorough warehouse receiving process is another first mile delivery must. This process specifies how you or your warehouse team will receive inventory shipments delivered by your supplier and is crucial for proper inventory tracking. Before that, you should establish the quantity of each item that will be transported in each container as well as the packaging specifications for every product. Then meet with the shipper, unload the required cargo, and double-check the received inventory against your inventory records. Organise the Data You must have a system in place to gather data and present critical distribution metrics in order to properly enhance your first mile delivery process. Data and information on the supply chain can be recorded in a variety of ways. You can assess the effectiveness of the first mile logistics process using different metrics like shipping timing, purchase accuracy, manufacturing cost, number of days your supplier needs to supply stock after receiving an order, the time period needed to disassemble pallet loads and stock ready-to-ship merchandise inventory and the proportion of your supplier's items that are harmed while being transported. By using inventory management software or a warehouse management system, much of this can be monitored or you can also just outsource fulfillment to increase your visibility of these metrics. Create a Packaging Process with a Scanning and Labeling System The majority of your products will be damaged regardless of how quickly it gets to your warehouse if it is not wrapped properly for transportation. The quality of the packaging used for your inventory is one factor to consider when choosing a supplier for your company, some even provide custom packaging services. There needs to be a proper scanning and labeling process in place to ensure that the right products are packaged and in the appropriate manner. You can read more about shipping labels. Challenges of First Mile Delivery in 2024 First mile delivery is a complex supply-chain process. There are several difficulties, but we will concentrate on the top four first mile delivery challenges likely to be faced in 2024: Lack of Visibility Poor visibility is a major challenge of first mile logistics that ultimately impacts not just mid-mile operations but also last-mile processes along with the experience of the end-buyer. Poor handling, en-route delays and ineffective tracking of freight movement from a warehouse to a hub, among other things are important impact areas of poor visibility. Lack of Focus on First Mile Experience For the past several years, businesses have come to understand the value of last-mile delivery in terms of offering a better customer experience. Due to the fact that this process has fewer stakeholders and is not customer-facing, first mile delivery has been conveniently overlooked as a result. First mile operations should be given the same attention as other aspects of the supply chain, such as the requirement to give customers complete transparency of the delivery process and to reduce logistics costs. Due to this, businesses must use reliable first mile tracking systems that reduce expenses and guarantee complete visibility of delivery operations. Improper Packaging Packaging frequently suffers as a result of the rush to supply quickly. Regardless of the type of item, businesses frequently employ standard packaging materials. This delays the entire freight transportation procedure and frequently results in material damage during first mile delivery. Branded packaging is the most sophisticated packaging method. It not only saves money and better safeguards products but also helps in marketing your brand. Ineffective Labeling Methods Labeling is a small but crucial component of first-mile delivery. Many companies still manually label packages to this day. As a result, not all the required fields are mentioned in packages, which causes dispatching to be ineffective and prone to delays. This problem is rapidly solved by automating dispatching, a crucial component of last-mile tracking technology. Top 4 Differences Between First Mile Delivery and Last Mile Delivery [table id=43 /] Suggested Read: List of Delivery Partners for Ecommerce & Last Mile Delivery Companies Conclusion: Integrating First Mile Delivery with WareIQ Now it is clear that good last-mile delivery has a direct impact on customer satisfaction and profitability. Customer satisfaction can be drastically decreased if a shipment is delayed or a customer receives an incorrect item. The first mile delivery procedure is largely manual for many logistics service providers, if not entirely. Moving all operations and supply chain data online is the first step to cutting costs and improving efficiency. Remember that you need applications that provide visibility and control to all parties involved including dispatchers, drivers, operations managers and shippers. Using WareIQ’s smart technology, businesses can customize logistics management systems to better suit their requirements and make smarter automation decisions. WareIQ, a complete logistics management system, guarantees a decrease in delivery costs and time. The end-to-end visibility and tracking capabilities that results from moving the entire delivery process to a digital platform are increased. Companies can use the best transport management system with optimal route management by partnering with WareIQ. Features like real-time intercity tracking, dynamic detention and delay alerts, delivery route planning and route optimization can improve linehaul tracking. Together, these capabilities greatly simplify the processes involved in first mile delivery. Customer satisfaction can be considerably raised by an effective tracking system and a prompt delivery system. WareIQ takes care of the following guidelines while sending freight: To appropriately spread the weight of your shipments when they are piled one on top of the other, we use top and bottom load protectors.Stretch wrapping is used to support the shipment during transit and avoid load movement.Enough bubble wrap is included in each box in the shipment to guard against breakage.As you develop connections with suppliers, we make sure to hold them accountable for their output and delivery quality.We increase vertical stacking strength, avoid damage to corner edges and balance the load by using corner/edge boards. First Mile Delivery: FAQs What is mid-mile delivery?Middle-mile delivery refers to the delivery of goods from a warehouse or distribution center to fulfillment facilities, where consumers buy their items. It is also known as second-mile delivery. The movement of finished goods from the fulfillment center to the customer is known as last-mile delivery. What is the main difference between first-mile delivery and traditional delivery methods?First mile delivery refers to the transportation of goods from the point of origin to the first transportation hub or distribution center, while traditional delivery methods refer to the transportation of goods from the distribution center to the final destination. What is last mile in the supply chain?Last mile delivery, used in supply chain management, refers to the challenging final leg of moving people and packages from storage hubs to their ultimate destinations. Why is last-mile delivery so expensive?Last mile delivery necessitates more frequent stops, fast-accumulating delays, and inefficiencies lead to increased driving and idle times, higher fuel and labour costs and unmanageable complexity. Minimizing costs, maintaining transparency, raising efficiency and enhancing infrastructure are a few issues with last mile delivery. Can I schedule specific pickup and delivery times for my first-mile delivery?This will depend on the specific first mile delivery provider and their schedule. Some providers may be able to accommodate specific pickup and delivery times, while others may have more limited options. It's a good idea to discuss your specific scheduling needs with the provider to see what customization options are available. Are there any additional fees for customizing first-mile delivery options?There may be additional fees for customizing first mile delivery options, depending on the specific provider and the options that you request. It's a good idea to discuss the costs of any customization options with the provider to determine if they are within your budget.

August 04, 2022

Product Bundling in eCommerce: Definition, Types, Advantages & Strategies for Online Sellers to Capitalise on Selling Product Bundles in 2024

Even eCommerce retailers are the customers of other brands in other industries. Customers often browse through multiple product listings and end up purchasing the option that gives them the best deal such as buy one get one extra, free delivery if the purchase value is of a certain amount and buy 3 products for a 10% discount on each, among others. This business trick is called product bundling and it is mainly used to increase the average order value of a business. In this article, we will learn all about how product bundling works, how it is implemented, strategies for online sellers, and ways to get better output while implementing a win-win situation for yourself as well as your customer. What is Product Bundling? Product bundling in eCommerce refers to several products or services sold together as a combined package to offer customers a better offer than if they were sold individually by a seller. Groom kits, sets of soap, value meals at restaurants and other products are a few examples of product bundles. Some companies only offer specific best-selling products in bundles rather than individually to entice customers to try other products along with their best-sellers. Product bundles are a well-liked strategy used by eCommerce retailers to sell more of their goods and raise their revenues over time. [contactus_lilgoodness] Types of Product Bundling Pure Bundling Pure product bundling prohibits the sale of individual products that make up the bundle separately. Instead, they can only be bought together at bundle pricing. The options available to the consumer are constrained by this strategy. For Example, many companies only offer trips or insurance for families instead of providing options for an individual. Mixed Bundling Customers can purchase particular products in mixed bundles or as standalone ones, at bundle pricing or standard pricing. A consumer at a fast-food restaurant, for instance, has the option of purchasing a single burger or a bundle value meal. Mix and Match Bundling The mix-and-match product bundling method enables customers to choose from a variety of related products. Brick and mortar retailers typically do this for quickly moving consumer goods like perishables or bulk items. Here, you list a few things for your consumers to select from and they can put the selections together to create a unique bundle. This technique raises the item's perceived worth by making the customer feel like they have direct control over what they purchase. It is the ideal strategy for pushing your clients to buy products in quantity and at bundle pricing without pressuring them to purchase things they don't want. Similar Item Bundling Customers that wish to buy a lot of things at once will benefit from using this strategy, which is similar to bulk buying. This technique is typically used with items that get depleted quickly. Examples of such products are conditioner with shampoo, face wash with face cream, etc. New Product Bundling In this strategy, newly launched products are promoted alongside more established or well-liked products to get clients to purchase your most recent offering. eCommerce shops employ this strategy, combining new products with existing well-known stock to increase visibility for the new offering. The more well-liked the current product is, the closer the customer is brought to the new product. Examples include new series of watches sold with mobile phones at bundle pricing by respective brands. Gift Set Bundling Gift packages are designed for customers who wish to present a loved one with a collection of complementary products. Most of the time, holiday seasons are when this kind of bundle is sold. As the name implies, this kind of bundling aids consumers in selecting gifts for friends. This is based on the idea that a present is better if it includes more items. When consumers are shopping for useful items over the holidays, this form of bundling is extremely common. For example, a grooming kit consists of several products. Cross-Sell Bundling As an add-on to a primary product, retailers sell a complementary product using this product bundling strategy. With less expensive things or with parts or accessories that match a more expensive item, this form of product bundling is effective. For example, when you buy a laptop, you may also purchase a bag or a charger. Buy One, Get One Free or Half-Price Bundling Source This type of product bundling is when consumers purchase one major item, they can save money on or receive a free additional item by combining them. This method works best for one-time purchase products. In the case of electronics, for instance, a client who purchases a laptop would not return to the store to purchase the same item. Giving your consumers a free item, a discount, or a gift card can thus encourage them to add more things to their carts at bundle pricing. By including extra features or products in your current purchase, product bundling increases the value of your sale. To meet your clients' preferences and satisfy their desires, you can adjust your product offerings. Offering distinctive and expertly designed product bundles can make you stand out from your rivals. It raises the perceived worth of your products in the eyes of your customers, clears out your stale inventory and increases sales. Inventory Clear-Out Bundling If you want to get rid of outdated inventory or simply create room for seasonal goods, this strategy is quite effective. To quickly remove it from your inventory, combine well-liked products with the stock of non-moving or outdated goods. Even when older products sell for less, this strategy aids in cost recovery. Occasional Bundling This approach maximizes the festive season and unique events. For instance, when it comes to Valentine's Day, you frequently see a combination of flowers, cards, wine and chocolates packaged together for people who wish to celebrate with their special someone. Advantages of Product Bundling To Retailers Increases Your Average Order Value (AOV) Over time, product bundling may boost individual item sales and profitability. Your average order value will go up if you bundle your products together to encourage buyers to buy many items at once. For example, if you are a sports item seller, you may give customers a choice so that while buying a bat, they can choose to buy balls and wickets, making them purchase more than a single product which increases your average order value (AOV). Decreases Marketing and Distribution Costs You can sell more products and spend less on marketing and delivery by using product bundling. You can combine complementary products and offer them as one bundle rather than promoting each product separately. When you package various things together, you only need one warehouse to keep them, as opposed to multiple. Bundling also reduces the number of boxes of individual things you need to ship and reduces the cost of postage. Instead of creating print and online advertisements for each product, you can group them to save money on marketing expenses while simultaneously promoting all of your goods. Reduces Inventory Wastage Unsold goods remain in your inventory as dead stock, increasing your holding expenses before needing to discard them. Bundling can be used to get rid of this dead stock before it becomes an issue. Customers will view the bundle as a deal and be more likely to purchase it if you combine a slow-moving or stagnant item with a faster-selling product. This lowers your inventory holding costs, decreases waste and frees up warehouse space. Aids in Product-Line Expansion Online shopping for single inexpensive things typically has two unsatisfactory options - either the vendor pays for shipping but loses money on the sale or the customer pays more for shipping than the item itself. eCommerce businesses can grow their product lines by bundling products at an order-value threshold in a way that benefits both customers and sellers. To Consumers Product bundles frequently provide discounts. Bundles are the ideal option if buyers plan to buy the contents of the bundle anyway. Customers will often compare prices on the package to obtain the greatest deals. If you are looking to price your products for more profitability, you can experiment with product bundling. They Can Try Out Different Products Customers can sample new products or product ranges that they might not have otherwise had the opportunity to try thanks to product bundling. Customers can be given complimentary goods to try when buying certain products. They Don’t Need to Waste Time Researching Multiple Products Product bundles naturally combine complementary solutions. As a result, buyers don't need to conduct any research to see whether those items would integrate or be of use to them. As a result, the purchasing process is expedited and the user experience becomes frictionless. They Can Personalize Their Order Make bundles specific to the buyer's needs so that they are not restricted to buying products that they don’t want or need. In such a scenario, a person can opt to choose multiple products that will add value to their initial order so that they perceive they are getting a better deal. Usage of Product Bundling in Marketing Source Creates a Positive Impression of Your Brand Customers will view an offer as more of a deal if it contains a reduced or free item than if the two items were sold separately. You can provide your consumers with the most value for their money while simultaneously increasing your sales by providing additional product bundling. Saves Time and Marketing Costs Product bundling helps marketers save time. It is significantly simpler for staff to stock (especially for physical products) and the products can be sold as a package deal, which reduces the number of products you need to promote to just one instead of multiple. Provides Seasonal Opportunities You can entice clients to buy more products by bundling them during busy periods of the year, such as the holidays or summer sales, by instilling a sense of urgency or FOMO. Also, during festivals, you can spend extra on campaigning and marketing and you can save money by promoting the items as one unit instead of separately. Enables You to Sell More Products to Customers Customers have more options and greater value with product bundling, especially if the package includes things they need. Customers are typically more likely to select a well-made bundle over a product that is sold separately. Reduces Shipping Costs As you are sending things in bulk, bundling them together and offering a discount results in lower overall shipping costs as only one package is being shipped as opposed to multiple shipments. Tips to Capitalize on Selling Product Bundles in 2024 In this section, we will look at how to offer product bundles as well as the criteria you should use to measure your success for year 2024. Understand Your Customers Keep proper knowledge of your target customer base. Observe the factors that motivate people to buy particular products even if you may already have information on your consumers in your CRM system, including historical sales and purchasing behaviour. Look at the things they do not buy collectively as well as what they buy collectively and when. You can begin to develop specialized product bundles and strategies after you have a better understanding of consumer behaviour. Create Bundles Accordingly Find what customers regularly purchase and based on the data, create product bundling that fulfills their expectations. Choose solutions that will appeal to clients by considering the complementary products from your range that you can sell together. Create varied product packages as a final step to ensure that there is something for everyone. Products that your customers have purchased earlier and are likely to buy again should be included in your bundles as this will assure repeat business rather than one-time sales. Offer Better Deals Customers are constantly seeking the greatest deal. They are constantly on the lookout for the best deals and discounts. Consider giving your bundles a discount to increase your sales. Without affecting your profit margins, this will greatly improve the attraction of your products. Choose a Product Bundling Strategy To make your goods stand out, here are a few product bundling strategies that will bring value to your bundles: Price anchoringeCommerce Flash Sale (time-limited) bundlesPut bundles in the most visible areasBundle products according to themesShow the savings and the deal advantagesConsider personalization Manage Analytics and Optimize Decision-Making You can evaluate the effectiveness of your product bundling methods using the metrics listed below: Average Order Value (AOV) If your Average order value per customer increases then find out which bundles are doing well and the reason behind it. Product Growth Annually You can determine whether an item is doing well as a standalone item by looking at its sales history over a year. If not, think about combining it with a high-performance product and keep an eye on the outcomes. Conclusion It is worth considering how you can use product bundling in your sales and marketing plans if you offer items or services because it's been a successful marketing technique in every industry and continues to be practised both online and offline. If you need assistance with storing and fulfilling your product bundles, consider partnering with WareIQ. WareIQ helps you analyse historical data to identify which strategies are effective, driven by the real-time purchases of buyers. While managing inventory, we can identify the sales rate of each product and show you the top and bottom-performing products to make it clear which items require product bundling. Our WMS software will calculate the cost of your bundling and can give you better bundle pricing after optimizing the storage cost of the product. You also only pay for the storage space and services you use. We also offer multiple other eCommerce fulfillment services such as a nationwide network of fulfillment centers and partnerships with more than 20 of the largest shipping aggregators in the country. Product Bundling: Frequently Asked Questions (FAQs) What are the advantages of product bundling?Over time, product bundling may boost individual item sales and profitability. Your average order value will go up if you bundle your products together to encourage buyers to buy many items at once. Which company uses a bundled pricing strategy?This is demonstrated by businesses like Amazon, which frequently put together dynamic product bundles based on related items that their customers frequently buy. This enables Amazon to provide lower pricing than its rivals while simultaneously generating higher profit margins for the company. What is product bundle pricing?Bundle pricing is a business approach where businesses combine multiple products into one package and offer it for one price rather than assigning separate prices to each product. Why do companies sell bundle products?The objective of product bundling is to increase sales by persuading clients to purchase additional things. Companies occasionally put together product bundles containing items they want to sell off or clear out of stock. What are some examples of successful product bundling campaigns?There are plenty of examples of the same. To state a few 1. The classic example of product bundling is the "meal deal" offered by fast food restaurants, which combines a main item (such as a sandwich or burger) with a side and a drink at a discounted price.2. Many retailers offer "bundle" deals on products such as electronics or home appliances, where customers can purchase a package of related items at a discounted price. How do I avoid common pitfalls when using product bundling?1. Make sure that the products in your bundle are complementary and add value for the customer. Bundling unrelated or low-quality products can turn off potential buyers.2. Determine the right price point for your bundle. The bundle should be perceived as a good value by the customer, but it should also be profitable for your business.3. Clearly communicate the value of the bundle to the customer. Make it easy for customers to see the savings they will get by purchasing the bundle rather than buying the products individually.4. Don't overuse product bundling as a pricing strategy. If you offer too many bundles, it can become confusing for customers and dilute the impact of the offer5. Monitor the success of your bundling campaigns and be willing to make adjustments if necessary. This could include changing the products in the bundle, the price of the bundle, or the way the bundle is marketed and promoted.

August 02, 2022

What is Order Cycle Time? Meaning, Advantages, Strategies to Improve Customer Order Cycle Time in eCommerce in 2024

In the world of flash sales and deals and same-day delivery in the eCommerce business, some sellers find it difficult to keep up while others find it easier and also save a lot of money in the process. This enables these sellers to serve more customers. There is a lot of time between when a consumer places an order and when it is actually delivered. Many businesses strive to reduce their order cycle time as much as possible. Understanding your purchase order cycle time and how to apply it to your business can help you control how quickly customers receive their orders. This article explains customer order cycle time, why it's significant, how to quantify it and what you can do to make it better. What is Order Cycle Time? Order cycle time is a key performance indicator (KPI) that measures and takes into account all of the steps and processes that eCommerce operations must go through to fulfill an order after it has been placed by a customer. Your overall order cycle time will be shorter if your processes are effective and longer if they are ineffective. Understanding your entire order cycle time is crucial because studies have shown that longer customer order cycle times significantly affect a company's ability to retain clients and get new ones. [contactus_uth] Advantages of Purchase Order Cycle Time Tracks Your KPIs As you know now, order cycle time is a key performance indicator that is used to measure a business’s fulfillment potential. It shows how well you can fulfill an order after getting a customer places it through your website or other selling platforms. Even if your customers are satisfied with the delivery time, you still need to track the monetary expenses you spend so that you further streamline all the processes. Reduces Travel Times Reducing the distance travelled to complete a task is one of the easiest methods to reduce order cycle time. Simply doing this can have a significant impact on your efficiency and production because time spent on travelling is time not spent on other value-adding activities. The main factor in the order cycle time is travel. The total purchase order cycle time can be sharply decreased if the distance travelled can be minimized. By emphasizing early errors and creating more effective pathways, you can achieve this. Your resources will be more productive by securing SKUs based on picking ability. A carton flow rack or shelf can reduce storage space and travel time if all of your SKUs are chosen from pallets and many of them are slow movers. Helps Forecast ETA ETA is crucial information for a buyer. Every customer wants to know the ETA of their order before they place it as this can affect their purchasing decisions. An accurate ETA can be conveyed only if the seller has a good idea of their order cycle time and if the ETA is on the lower side compared to the distance the order has to travel, it is believed the order cycle time is working properly. Detects Incompetencies in the Supply Chain Identifying the order cycle time of your business might help you spot supply-chain problems that can be delaying your order fulfillment procedure. A lengthy order cycle time is a sign that your supply chain process needs to be reviewed to find any inefficiencies or extra stages that could be eliminated completely or streamlined. For example, a lengthier order cycle time can result from manual order receipts, which can be labor-consuming and error-prone. You can also see how we analyse supply chain metrics. How can Order Cycle Time be Measured? The calculation for customer order cycle time is as follows: Order Cycle Time = (Delivery Date - Order Date) / Total Number of Orders Shipped Using the above formula, you can calculate the cycle time for customer orders. The following processes are involved in calculating the purchase order cycle time: Collect client informationSubtract the delivery date from the order dateDivide that by the total number of shipped ordersInterpret the outcomes Gather customer information, including delivery and order dates, as well as the total number of shipped orders and enter it into the formula. Some companies keep track of this information in a spreadsheet or client database. You might gather the information you need more quickly with the use of an automated system. When you get your results, compare them to the objectives of your business. You can pinpoint any areas that need improvement by using this method. You can also keep track of the information, recalculate on a monthly basis and evaluate any advancements. 6 Methods to Reduce Customer Order Cycle Time in 2024 Evaluate And Improve Inventory Flow Longer order cycle times can often be attributed in a large part to bottlenecks in the warehouse. For example, check whether goods can be located with ease, if the shelving racks are properly spaced apart to allow for quick movement and if the location of your fulfillment bay is too far away from the picking area. The selection and packing process can be slowed significantly by any of these obstacles. You can shorten the time it takes for an order to be processed by detecting these inefficiencies. Measure your warehouse KPIs first then look for areas where you can make changes. To maximize the use of the available space and increase picking effectiveness, you might need to optimize your warehouse setup and apply warehouse slotting. Set Strict Rules Improving your processes depends on your fulfillment personnel being guided by defined rules and processes. To expedite the process and get orders from the shelves to the packing room as soon as possible, you may be required to reduce the size of the picking batches. To make it simple to sort or pick up returned items faster, you can also establish rules for how and where to leave them. Setting restrictions on when to order additional inventory is also crucial for preventing stockouts and backorders which can slow down your order cycle time. Examine your present delivery management strategy. You should set rules for what to do with the information in the event of delivery exceptions in addition to giving your personnel access to real-time eCommerce order tracking. In order to set reasonable expectations, it's crucial to be open and honest with your clients regarding your delivery practices, such as shipment cutoff times. Have a Backup Plan for Late Deliveries There are many cases where you can face late deliveries because of reasons such as stockouts, inefficiency in the supply chain, technical glitches, etc. So for all these cases, you as a seller must have a checklist of backup plans associated with each situation. You can partner with more than a single fulfillment company, have deals with merchants to dropship automatically in case of a stockout and a WMS that takes care of technical aspects of your fulfillment process. Constantly Evaluate Your Order Cycle Time Order cycle times can vary periodically, particularly if the supply chain is altered or disrupted. An unanticipated delivery hindrance, for instance, can cause an order cycle to take substantially longer than is typical. After deploying an automated system to enhance your warehouse receiving procedure, you can observe a significantly reduced order cycle time. Your supply chain's entire range of factors can have an impact on this statistic. Your order cycle time needs to be closely monitored and evaluated on a regular basis. By doing so, you can decide whether you need to assess your supply chain procedures and make any accelerated changes. It's an excellent approach to assess whether the adjustments you've made have a positive impact on your customer order cycle time. Give Incentives to Involved Resources Order cycle time is something that a seller needs to take constant care of to maintain and try and reduce. It will make no difference to the involved resources whether they fulfill one order a day or 10 orders a day. Giving them an incentive to enhance the quantity and quality of their services, whether it is inventory management, packaging orders or delivering them, as this result in a major reduction in your order cycle time. Outsource Fulfillment The simplest solution to reducing your order cycle time is to delegate the fulfillment operation to professionals. Using a third-party logistics partner to outsource fulfillment is a good approach to guarantee that orders are immediately confirmed, chosen, packed and dispatched. A tech-enabled 3PL should enable you to automate a sizable piece of the fulfillment process. Many 3PLs include technology that easily integrates with your online store. As soon as orders are placed by clients, they are automatically accepted in their warehouses and fulfillment facilities. So, the orders are processed automatically, allowing them to pass rapidly through the fulfillment pipeline and be delivered to your consumers within a few hours. Additionally, by automating the process, less manual work will be required, lowering the possibility of errors while increasing order accuracy. Conclusion: Reduce Your Order Cycle Time With WareIQ Reducing order cycle time is a major concern for most eCommerce businesses as it directly impacts their ability to fulfill orders. The best method to reduce your order cycle time is to outsource your fulfillment service requirements to a 3PL company like WareIQ. WareIQ’s USP is offering Prime-like delivery to everyone but for much lower costs and with more coverage. We offer services like same-day and next-day delivery and oversee your entire logistics process which helps reduce your order cycle time while ensuring that orders are delivered efficiently and on schedule. Utilizing WMS software, WareIQ allows you to effectively manage multiple orders and decentralized inventory that is located in multiple fulfillment centers at your fingertips while also assisting you in streamlining your fulfillment processes. WareIQ's integration with multiple eCommerce selling platforms ensures that orders are automatically accepted and processed. Orders can be processed and delivered more quickly as a result, cutting down on fulfillment and delivery delays. Additionally, we provide real-time inventory level updates. This implies that your online business will always have precise stock level information, preventing customers from placing purchases for items that are out of stock. As a result, backlogs and delayed fulfillment can be avoided by utilizing and optimizing your sales history and precisely forecasting future demand. Setting reorder points for both finished items and product inventory can be done using this data together with additional considerations like the production wait time. By doing so, you can increase supply chain speed and avoid problems like stockouts and backlogs that could lengthen the time it takes to process an order. Order Cycle Time: FAQs How to calculate EOQ order cycle?The order quantity is divided by the yearly demand and the resulting fraction is then multiplied by the number of working days in the year to determine the EOQ order cycle. What is cycle time in the supply chain?The duration of time it would take to complete a customer's order if all inventory levels were zero at the moment the order was placed is measured by the supply chain cycle time which is a comprehensive metric and is a total of the longest lead times for each phase of the supply chain cycle. What is the difference between lead time and cycle time?Lead time measures the period of time between a customer order and order fulfillment, while cycle time measures the amount of time it takes a team to create a product. Because cycle time fits within the timeframe of lead time, lead time is always longer than cycle time. What is the customer order promised cycle time?This cycle time performance indicator reflects how long it should take from the time a customer places an order to when it is delivered. The cycle time will largely stay the same; it will only change if you can guarantee a shorter time from order to delivery. Is cycle time the same as flow time?No. The time it takes for a single unit to complete the entire manufacturing process is known as the flow time. Cycle time is the average amount of time required to complete the entire manufacturing process for one unit.

July 25, 2022

Average Revenue Per Unit (ARPU): Definition, Formula to Calculate, and Methods to Increase ARPU in 2024

While running a business, you must keep an analysis of every important metric. You can observe things such as the quarterly revenue, cash flow, inventory sold, etc. As per the industry and new techniques of gaining customers against more revenue, there are several other metrics too. According to the business type, the KPIs (key performance indicators) needed can vary drastically. For instance, subscription services and product bundle sales will require the use of average revenue per unit, or ARPU. To ensure that your pricing remains competitive and that you don't lose clients to your competitors, it's crucial to properly plan and prepare accordingly. A profitable pricing strategy should be balanced out with an increase that your clients would consider reasonable. In order to make informed decisions regarding your pricing strategy, it is critical to consider what your competitors are doing. In this blog you will precisely learn about average revenue per unit (ARPU) and why it is crucial for business, how can you apply it, and how you can increase the magnitude of ARPU in your business. What is the Average Revenue Per Unit (ARPU)? The average revenue per unit is an important indicator of average profitability generated by each user or subscriber. It is mainly used in the telecommunications and media industries, which have a subscription-based revenue model. In the eCommerce business, it helps sellers in inventory management as a KPI that reflects the data about the average revenue after selling one unit of an item. Most phone carriers, internet service providers, software solutions, and the media and streaming sector use ARPU. It is also used for membership-based enterprises and subscription box services. So while it is a crucial statistic for managing inventory, it may also be used to determine performance when it's impossible to track individual product sales. [contactus_lilgoodness] How to Calculate Average Revenue Per Unit Using the ARPU Formula in? To calculate ARPU, you need to define a certain time period. For reference, the majority of telephone and communications providers determine ARPU on a monthly basis. The number of units or users is then divided by the total income made during the standard time period. Since it might not accurately reflect changes with time, the end date of the period is not used as the denominator. The average of the beginning and end of the determined duration is taken instead. The number of users varies at any one time, particularly in sectors like media and telecommunications. Therefore, in order to calculate ARPU as accurately as possible, the number of units for a specific period must be calculated. The calculation is quite simple. We need two values as mentioned below: The total revenue in a certain time periodThe number of users in that time period Then divide the total revenue by the number of users ARPU Formula = Total Revenue / Number of Users Benefits of Calculating Average Revenue Per Unit Helps Manage SKUs More Accurately Your average revenue per unit, when utilized with SKU monitoring, aids in streamlining the SKU management process. This makes it possible for you as a seller to closely monitor which SKUs are selling quickly, which ones are moving slowly, which ones are more profitable and which ones are eating up your money. After that, you can use these revelations to guide your SKU rationalization efforts. This is the procedure for determining which SKUs should be retired due to poor profitability and sales. Long-term eCommerce revenue is improved by an effective SKU rationalization process since the sooner slow-moving and unproductive SKUs are discontinued, the less money you will need to spend on procurement and holding fees. Therefore, you can easily increase your revenue by leveraging your average revenue per unit to enhance your SKU management. Helps in Strategizing Pricing Plans Optimizing your pricing approach is one of the main ways that figuring out your average revenue per unit can help your organization. This KPI can help you determine whether changing your product's pricing strategy will increase profitability. In order to boost average order value and hence, your average income per unit, this revaluation may entail changing your product bundles. It might also entail gradually raising your product's markup. For an eCommerce business to grow, this is a critical stage. Over time, markups on prices and products need to be modified continuously. Additionally, knowing your average income per unit might serve as a benchmark for your decisions. Enhances Warehouse Management A crucial element in your inventory management procedure is calculating your average revenue per item. It helps you determine whether your inventory levels are ideal since if you have too much inventory, you may experience a lower average revenue per unit because you are paying more for purchasing and managing your inventory. Furthermore, when a product stays unsold on the shelves, having an excessive amount of inventory in stock increases your chances of having deadstock. Due to the cost of purchasing things that are not getting sold, this further lowers your average revenue per unit. However, it is simpler to determine which SKUs have higher profitability and inventory turnover and whether any slow-moving SKUs need to be terminated when you are actively monitoring your inventory movement and average revenue per unit. This makes it possible for you to establish the minimum order quantity (MOQ) for each unit, which is crucial for preserving the ideal amount of inventory throughout your warehouses and fulfillment facilities. By doing this, you avoid ordering too many slow-moving items and too few fast-moving ones. Identifies Opportunities to Increase Revenue and Reduce Costs Finding more ways to increase your revenue is probably one of the main benefits of calculating your average revenue per unit. This indicator enables you to identify which goods and services are effective at bringing in money and which ones are not. In order to maximize your offerings and increase your revenue, you must first choose how to do it. Cost savings are yet another significant advantage of determining your average revenue per unit. Because increased expenditure frequently results in decreased income, your inventory-related costs may drastically impair your ARPU. Therefore, looking at your average revenue per unit will help you determine whether your costs for acquiring and maintaining inventory are too high. This is an excellent way to find any areas where you can reduce your cost of goods sold and cost per unit. Ideally, you ought to consider your ARPU in conjunction with the various expenses incurred. Forecasts Growth and Revenue Finding more ways to increase your revenue is probably one of the main reasons to calculate your average revenue per unit. This indicator enables you to identify which goods and services are effective at bringing in money and which ones are not. In order to maximize your offering and increase your revenue, you must first choose how to do it after optimizing it. Suppose you want to focus more on one subscription box if it has a high ARPU, stock more of it and work to boost subscriptions for it. Alternatively, you might think about pairing well-liked, highly profitable SKUs with sluggishly moving SKUs to increase sales while avoiding deadstock. In the case of eCommerce services, you are aware of the high demand and more profitable products so you can store those and promote them to increase their sales velocity. Pros and Cons of ARPU Pros For investors, ARPU is a useful indicator for comparing a company with its competitors.It works as a metric to analyze a company’s strengths and weaknesses.It shows the acceptability rate among users if the ARPU number is impressively high.High ARPU can also boost a company's reputation. Cons Since ARPU is a metric at the macro level, it can be reported without the specifics that give it meaning.The trajectory of a business may be better indicated by user growth and user churn.There are situations when ARPU is reported without sufficient details.Low average revenue per unit can damage a company’s reputation and investors may find it risky. How Can Average Revenue Per Unit be Increased in 2024? There are several ways to increase ARPU depending on the business type and its usability. Many businesses, including telecom providers, try to increase their ARPU by offering bundles or more advanced levels of service to their present clients. These two different business models use their internal data to determine which demographic groups are most valuable to them. After identifying the most valuable group, the corporation focuses on encouraging growth within that group. Selling their current clients more expensive tiers or service bundles is one strategy used by many businesses, particularly in the telecom industry, to raise their average revenue per unit. Others, like media businesses, concentrate on raising advertising revenue. Media and telecom businesses both do internal data analyses to determine which demographic groups are most valuable to them. The target market for the company's growth will be gen X consumers or families with children if those groups look to be their most valuable customers in terms of their contribution to average revenue per unit. Note: Many companies are decreasing their ARPU but adding more users to generate more revenue. Uses of Average Revenue Per Unit (ARPU) Telecommunication Companies ARPU is a metric used by telecom companies like AT&T, T-Mobile, and Verizon to track the average revenue generated by each mobile phone subscriber. The value of revenue used to compute ARPU for a business in the mobile phone market includes any money from incoming calls and data charges that must be paid as part of the regulated interconnection system, as well as the monthly bills that users pay. Social Media Companies Companies in the social media space like Snapchat and Meta Platforms (formerly Facebook) provide investors with average revenue per unit data. The disparity in these metrics between the two businesses contributes to the substantial discrepancy in the two businesses' values. Subscription Services The results of the metrics can be used both internally and externally to compare subscriber-based businesses and to help predict upcoming service revenues derived from a customer base. Average Revenue Per Unit (ARPU) vs. Customer Lifetime Value (CLTV) Some people mix up ARPU with client lifetime value. Despite their similarities, they both have different metrics. Their differences are laid out below: [table id=41 /] Conclusion: Increase and Maintain Your Average Revenue Per Unit With WareIQ WareIQ is a rapidly growing ecommerce fulfillment company that is based in India. It offers a variety of eCommerce services that can help you to increase and maintain your average revenue per unit by streamlining multiple processes and reducing your storage costs and operational costs. A few ways we can help are listed below: It gives you facilities like a nationwide network of fulfillment centers and offers no MOQ to help lower storage and transport costs and ultimately, APRU.We have partnered with more than 20 of the biggest shipping aggregators in the country and always assign the cheapest and best delivery partner for every order with real-time tracking.We give access to your sales and revenue data to assist in framing pricing strategies and getting further orders.It gives you RTO insurance which prevents the negative impacts of returns management.We help you forecast demand and supply which helps you in maintaining APRU.We help pack your goods in a customized manner (boxes or bags) which helps you in lowering packing costs.We help cut unnecessary involvements that cost you overall on your ARPU.We optimize your sales data and reflect your KPIs. Average Revenue Per Unit FAQs (Frequently Asked Questions) What is ARPU?ARPU is a measure of its profitability based on how much money a product makes from each of its customers or subscribers, and the average revenue per unit. For businesses in the media and telecommunications sectors, which rely on subscribers or users, it is an especially helpful metric. Is ARPU a KPI?Average Revenue Per User (ARPU) is a KPI and can be used to distinguish between the productivity of your sales and marketing departments. What is a good average ARPU?Based on location, industry and pricing model, the average ARPU is likely to vary. As a result, there isn't a constant answer to it.

July 23, 2022

Retail Distribution: Definition, Types, and Factors to Consider While Opting for a Retail Distribution Strategy in 2024

Inventory is the biggest asset for an eCommerce seller but it is not easy to order and store. There are several things to be taken care of before and after ordering products. To remain competitive in the long run, a seller will need to adopt new strategies and broaden their perspective in order to be competitive. By streamlining all their retail logistics activities and having effective distribution management, they can increase the effectiveness of their supply chain processes. As a result, for better efficiency and cost savings, you will require an optimized retail distribution plan. Today we will learn about retail distribution including the types and considerations while choosing the right retail distribution strategy through third-party logistics. What is Retail Distribution? A retail distribution strategy is the process of getting goods from manufacturers to sellers or direct to customers (D2C) through a fulfillment channel. Throughout this journey, products move through many intermediaries such as wholesalers, vendors and retailers or in the case of dropshipping, directly to buyers from the manufacturers themselves without passing through a store or selling platforms. Manufacturers, wholesalers, retailers, agents, etc. are mainly included. Choosing the correct retail distribution plan is the secret to a successful distribution process, higher revenue and long-lasting client loyalty. [contactus_uth] 3 Types of Retail Distribution Intensive Retail Distribution Companies use this retail distribution technique to widely disseminate the availability of their items so they can access the market as much as possible. Brands can accomplish this goal by distributing their goods to as many eCommerce retailers and outlets as they can. Retailers of convenience goods are particularly prone to intensive retail distribution. For example, you can easily find glucose packets in almost all types of stores and malls. Advantages Boosts product awareness Encourage impulse buying Enhances revenue Selective Retail Distribution Selective retail distribution falls between intensive and exclusive retail distribution. With this retail distribution approach, products are distributed to numerous places. However, it is used much less compared to intensive retail distribution. For example, a premium watch brand like Tag Heuer may choose to sell its product to its own branded stores or other selected stores. But places like DMart or Reliance Retail cannot be seen selling Tag Heuer. The reason behind this is that such brands need to imply and maintain a high-end brand image and exclusive messaging. Advantages Ensures good market coverage Offers more control Boosts customer satisfaction Exclusive Retail Distribution Exclusive retail distribution is distinct from intensive retail distribution. This form of retail distribution employs certain distributors who are told to sell products only in predetermined locations. Exclusive distribution is frequently used by companies that sell expensive, high-end goods. This method and a brand's prestige image are therefore related. It aims to reach a certain niche market that is well-defined and capable of buying the product. For example, IKEA malls usually consist of 1 or 2 locations in a city which is also on the exterior of the main town. Advantages Keeps the firm focused Secures the manufacturer’s finances Facilitates localization 4 Factors to Consider While Choosing the Right Retail Distribution Strategy in 2024 Product Type Routine, limited, and extended products are the three main categories of purchases for retail distribution. Products that are inexpensive and that consumers do not give much thought about while making purchases are considered routine purchases. When a certain brand's product is out of stock, buyers tend to move to another one rather than visiting other places to purchase the same product, making them highly replaceable. Toothpaste and batteries are a few examples. An elaborate retail distribution strategy is advised for these commodities. Customers aren't always loyal to particular brands, so having the products widely available and simple to get enhances the likelihood that they will be purchased. Between routine and extensive purchases are limited purchases. The prices of these goods are often fair. Compared to a typical purchase, consumers take more time to research and compare various products. Mobile phones, washing machines and refrigerators are examples of limited purchase products. Customers consider the pricing and usefulness more carefully before making these purchases. And for these types of goods, either a selective or an intensive retail distribution strategy works best. Extensive purchases include high-risk items like homes, auto insurance and schooling. The intensity of the buying choice also increases as an item's price rises. For certain goods, an exclusive distribution strategy works well since it helps clients see the value in the good or service. To raise the price of each item, some brands even make fewer of these expensive goods. Customer Demand Based on Location Having your inventory close to your customers is an efficient approach to streamlining distribution and fulfillment, regardless of the retail distribution strategy you are already utilizing. Based on previous demand, this would include strategically distributing your product throughout various distribution hubs. If the demand for your goods is high in one area and low in another, you might need to send out fresh orders from the distribution center that experiences less demand and has spare inventory on hand if you run out of stock in a high-demand location. So, products need to travel for longer distances all the way to the high-demand area. Long shipping routes are required to deliver goods to the region with the high demand. This slows down the supply chain and increases shipping costs. Instead of spending time and money delivering the products to your customers, you might be able to save time and money by strategically moving your inventory to the high-demand distribution hub. Similarly, you should provide retailers who have done really well at selling your goods with a greater amount of inventory to avoid stockouts or losing out on sales. Inefficiencies of Distribution Strategies Retail distribution has a lot of moving items and thus, it seems inevitable that your retail operations will have some inefficiencies. It is critical to routinely review your distribution strategy for any ineffective procedures that need to be improved upon or eliminated. You can have a number of partners who are in charge of different aspects of your distribution process. Suppose, you have three partners. One partner manages a retail warehouse, another partner handles fulfillment and a third partner handles last-mile delivery. The rest of the supply chain encounters a delay if any one of these partners experiences an interruption to their regular business operations, which could have a substantially negative impact on your bottom line. Instead of depending on a single partner who is capable of managing all the processes, different people might assist you in streamlining and simplifying the procedure. You should do an audit to search for ways to cut costs as well. Find the most expensive distribution steps and determine if there are any less expensive alternatives. Since products must pass through several shipping zones before they finally reach the buyer, quick distribution of goods from a single central hub can become very expensive. Instead of using local distribution, fulfillment services can speed up deliveries while drastically reducing freight expenses. Even obstacles in your distribution process may be discovered by a thorough audit process. Suppose a warehouse is poorly organized, pickers may have a harder time finding what they need, which would slow down distribution and fulfillment procedures. You may determine what needs to be improved and how to address those bottlenecks by recognizing these problems. Cost While Partnering With a 3PL Every retail distribution plan has advantages and disadvantages with the associated cost. Knowing the costs can help you choose the best retail distribution strategy for your retail company and guarantee that your firm’s finances can cover the costs and any potential losses. Extensive retail distribution strategy planning entails product availability in as many markets and retail locations as possible. It should therefore come as no surprise that raising product awareness is expensive, particularly if a company wants to sell its goods in every store. The location of the retailer may affect the prices. As a result, if you intend to use an intense distribution strategy for your retail firm, this is a crucial issue to take into account. While it appears that selective retail distribution is less expensive than the intensive option, disagreements with distributors can result in significant losses. Because of the nature of such a retail distribution strategy, this could be costly. Companies must make sure there is enough effective communication when problems arise in order to address them all right away. Conclusion: Optimize Retail Distribution With WareIQ Retail distribution is an essential aspect of eCommerce fulfillment as it enables goods to be transported from the manufacturer to the seller’s fulfillment centers and eventually to their customers. To accomplish all of your retail distribution goals, you can consider partnering with WareIQ. Using WareIQ, you can strategically split up your goods and store them in multiple fulfillment centers, located across the country. By keeping inventory closer to your customers, you can speed up delivery while saving money on freight. We also take care of the entire range of fulfillment processes from handling the picking and packing of goods to transporting it to your customers. Orders are automatically received, processed and forwarded to the fulfillment queue in our warehouses, where the picking and packaging procedures are started. In order to keep shipping costs down, WareIQ ships your products on your behalf through well-known shipping carriers and always assigns the fastest and cheapest option for every order. Additionally, automation through our custom Warehouse Management System streamlines and improves the efficiency of the entire B2B order fulfillment process by bringing order data and updating inventory levels in real-time, directly into the WareIQ dashboard, where it can then be analyzed and tracked. Retail Distribution: FAQs

July 21, 2022

Fill Rate in Supply Chain: A Comprehensive Guide Including Types, Calculation, Importance and Tactics to Maintain the Fill Rate in 2022

Running an eCommerce business has been very competitive since the majority of people now have access to the internet. Each and every website claims to give you a variety of products in the shortest period of time. Due to this, customer expectations have increased in recent years. Any eCommerce firm must have an effective fulfillment process to succeed in a world where customers expect their products to arrive quickly. You cannot afford to have delivery delays brought on by backorders and stockouts if your eCommerce firm is expanding. In order to increase order fulfillment and improve delivery times, the order filling process needs to be carefully watched and successfully optimized. For this reason, fulfillment rate is a crucial metric that eCommerce companies should monitor. The fill rate is directly proportional to the deal an eCommerce company makes with a customer and the revenue it generates from it. In this blog, we will go into detail about the fill rates in supply chain management, how to calculate it, the importance of maintaining a good fulfillment rate and why choosing a 3PL logistics company is important. What is Fill Rate? Fill rate or order fulfillment rate, is the rate of orders a seller can ship from their available inventory without missing out on purchases due to stockouts, backorders, lost sales, etc. It shows the level of eCommerce management a seller is versed with and whether they are able to meet the demand or fail to fulfill orders. It also helps sellers gauge the demand for various SKUs in their inventory and plan item procurement accordingly. [contactus_gynoveda] Types of Fill Rate While the order fill rate is frequently the metric that most businesses track, there are other fulfillment rates in supply chain management that might provide useful information about how effectively a business' supply chain management is working. They are as follows: Order Fill Rate The order fill rate is frequently tracked because it shows how effectively businesses can meet their buyers' needs. High order fulfillment rates are a sign of a company's ability to fulfill placed orders effectively and on time. Case Fill Rate The percentage of product cases a seller initially ships out of all the product cases the company orders is known as the case fill rate. It is mostly applicable to distributors and wholesalers. Line Fill Rate The percentage of order lines that a company fills out on the bill compared to the total number of order lines is known as the line fulfillment rate. On an order bill, companies keep track of sales made from customer orders as line items. Vendor Fill Rate Companies that buy products from vendors in wholesale quantities calculate vendor fill rate. This metric identifies the proportion of vendors who have shipped out orders out of all the vendors a company receives orders from. Warehouse Fill Rate The order fill rate is measured using the same metric as the warehouse fill rate. Managers of supply chains determine what portion of all customer orders are filled and shipped from their company's warehouse, which is known as the warehouse fulfillment rate. Importance of Fill Rate The key to optimizing your wholesale inventory management, fulfillment procedures and enhancing customer satisfaction is knowing how well you can satisfy demand. Helps in Brand Positioning When your business consistently completes customer orders and maintains a high fill rate, it enhances its reputation, builds market trust and ultimately leads to positive positioning. This is due to the likelihood that clients will believe they can depend on your business to rapidly process and ship their orders. When first-time clients enjoy the ordering and delivery experience with your business, they are also more inclined to make subsequent purchases. Affects Customer Relations Do you meet and take care of your customers' requirements right away or do you make them wait? Or have you established yourself as a dependable partner prepared to meet the demands of the market? Your credibility and the accessibility of your goods are important determinants of the development of enduring relationships with your partners and clients and result in increased levels of loyalty. The relationship of trust in a business is built by fulfilling what you claim to. Provides Operational Insight Your business may assess how well the supply chain processes are doing by monitoring order, warehouse, and vendor fulfillment rates. Lower fill rates can provide more information about the areas of the process that need improvement and when a seller is aware of this indicator, it can build plans more effectively. You need to examine the strategies you employ to deliver your products to customers by measuring the fulfillment rate. Enhances Inventory and Labour Management If your fill rate is constantly low, then make sure you are keeping ideal stock levels by searching for other suppliers or reviewing your reorder point. It helps you to scrutinize your fulfillment process and the team managing it. Having adequate inventory means that, although you face a consistently low fulfillment rate in a certain location, it may be a problem with the management and so you can check and resolve it. Upgrades Fulfillment Processes Your capacity to complete orders on schedule may be significantly impacted by an ineffective packing or shipping process. If your fill rate is poor because of packing or shipping problems, you should look into ways you can streamline your fulfillment processes. How is the Fill Rate Calculated? The steps below show you, how to find the fill rate of your company: Calculate the Total Number of Orders That Have Been Shipped Choose the time period for the fill rate measurement before using the below formula. This calculation, which you may perform on a monthly, weekly, quarterly or even annual basis, allows you to assess how well your company completes customer orders at various points of the year. Consider the situation where you wish to calculate the fill rate for the most recent quarter. Find out how many orders in total your business shipped to customers during that time. If during that quarter, clients placed 1,500 orders, use this number in the formula: Hence, the fill rate is calculated as; Fill Rate = (1,500 Shipped Orders) / (Total Orders) x 100. Divide Shipped Orders By the Total Number of Filled Orders Find out how many orders customers made overall during the period. Using the example value of 1,500 total fulfilled orders, assume that customers placed a total of 1,700 orders. Put the values in the given formula: Fill Rate = (1,500 Orders Shipped) / (1,700) x 100 = (0.88) x 100 = 88 Multiply Your Result by 100 You will get a value in a decimal after dividing. To convert this value from decimal to percentage form, multiply it by 100. The fill rate is always represented by a percentage. The fill rate would be as follows using the example numbers of 1,500 completed orders out of 1,700 total client orders for the quarter. Fill Rate = (0.88) x 100 = 88% The fill rate in the above case is 88%. Depending on the business, this can be a good fill rate. For instance, a company would have improved its fulfillment rate over their past rates if it increased it to 88% from a lower percentage. Your company's customer satisfaction rate will be as high as your fill rate and should be close to 100%. What is a Standard Fill Rate and How to Increase it? A standard fill rate varies for each seller depending upon the offered product, selling platform, fulfillment type and company fulfilling it, in addition to location, demand, season, etc. 85-95% is generally considered as a good fulfillment rate. There are a few ways to increase and maintain it: Choose a Trustable and Capable Fulfillment Partner To increase the fill rate, fulfillment partners are one of the more crucial elements to rely on. An incompetent fulfillment system can never achieve a good fill rate. It is robust work to perform without any delays and needs to be fully accurate. A third-party fulfillment company ensures competent fulfillment under the guidance of experts, technologies and many more factors running the market. Provide an Option of Alternative Products It is difficult to offer an alternative if you sell a product that is too specialized. However, in many cases, you can provide options based on your customer's choices and the resources available to you. Your customers will likely choose to try an alternative if they have to wait for you to ship their intended order. Ask Your Sales Representatives Not to Sell Out-of-Stock Products Your team should check the inventory levels and avoid listing and selling such products that are not available, and concentrate on other options if a buyer is looking for similar products. You can add a timer to notify the buyer when it could be available to buy the product again. Invest in Tools for Inventory Optimization and Demand Forecasts SaaS tools created for the purpose of inventory management and increasing your fill rate are not a luxury but rather, a must that adds useful data to your products and accompanies you on your way toward efficient data management. It automatically reorders products by optimizing your data, forecasting demand, defining inventory space, etc. It knows which of your products sell more quickly and easily. It helps you choose the best time to place fresh orders with your suppliers and make up for any shortfalls. Conclusion: The Role of WareIQ in Maintaining Your Fill Rate Why Choose a Third-Party Fulfillment Company Customer expectations are constantly increasing in the eCommerce segment. It is not easy, especially for small and medium-scale sellers. They have problems running their business or tackling other related problems. A seller may struggle to manage a store on multiple selling channels and a vast supply chain. This is only possible through 3PL fulfillment companies. By partnering with these companies, a seller can avail of different types of fulfillment and can easily maintain their fulfillment rate of over 90%. Sellers only have to take care of the selling and marketing aspects of their products. Post getting an order, all the fulfillment processes like sending an order confirmation message or mail, picking, packing, inventory management, assigning a delivery partner, collecting the payment, re-ordering and many more procedures are taken care of by the 3PL. The quickest approach to increase your order fulfillment rate is to work with a 3PL that makes good use of technology. The majority of your eCommerce fulfillment procedures can be automated using advanced software, which interacts with your online store and gives you superior visibility into your inventory management and warehouse operations. Getting a 90% Plus Fill Rate With WareIQ WareIQ is a pioneer fulfillment company that can give customers a fill rate of more than 90% to our customers. With WareIQ, you get a decentralized multi-warehouse layout that can easily fulfill your orders within the least time and with the least freight expenses. With its AI and ML-based warehouse management system software, you can optimize your sales data, forecast future demand, maintain inventory across multiple fulfillment centers and eCommerce selling platforms, and keep track of each and every item through a single dashboard. Orders are automatically processed by WareIQ so they are swiftly sent to the fulfillment queue, where products are quickly chosen, packed and prepared for shipping. It eliminates the human input, which reduces the possibility of errors and improves order accuracy. All of these elements greatly quicken the order filling process and let you fill more orders at once, resulting in an increased fill rate. Fill Rate Frequently Asked Questions ( FAQs ) What is a good fill rate?A seller should aim to have a fill rate of 100% if possible. An average fill rate is around 85-95% depending on many factors like demand, supply, season, weather, supply chain, management, etc. What is fill rate performance?The percentage of orders that can be filled immediately from the available inventory of a company is known as the fill rate performance. A high fill rate's impact on customer satisfaction must be evaluated against the cost of keeping larger stock levels. What affects fill rate?A better fill rate depends on the kind of products you sell, the level of market competition and customer loyalty. You can clearly see your stock levels and how they affect the health of your company by conducting an inventory study. What is an OTIF score?On-time, in-full or OTIF is the capacity of a supplier to deliver goods to distribution centers measured by this benchmark, by which retailers evaluate suppliers within specified delivery windows and in full quantities. Sellers mostly measure OTIF scores monthly or quarterly.

July 20, 2022

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