The most challenging aspect of e-commerce logistics is supply chain management, which demands intensive resources and top-notch supervision, putting huge pressure on the operational machinery of the e-commerce firm.
Therefore, the majority of large and small-scale e-commerce companies prefer to outsource their logistics requirements to third-party logistics providers in order to save time and resources these days. 3PL providers enable time-efficient and highly-coordinated logistics services to e-commerce firms, in order to ensure full-fledged customer satisfaction.
What is Outsourcing in E-commerce?
Engaging a third-party logistics company to carry out logistics operations, that would otherwise be done internally by a company's employees is basically called outsourcing in e-commerce.
But before you decide to partner with a 3PL provider or logistics aggregator for your business, it is important to know the pros and cons of outsourcing:
Pros of Outsourcing Your E-commerce Logistics
Minimizes the difficulty of back-office management
The systems and staff needed for the back-end tasks will be available from 3PL outsourcing service providers, cutting off the load of too much paperwork. Logistics outsourcing can handle the regular tasks, freeing up the company to concentrate on other priorities by assigning a dispatch note, doing physical verification, and checking that all shipment paperwork is in order.
2. The benefits of logistical reach
The majority of 3PL providers have a widely dispersed network of carriers and fleets that enable them to quickly travel to any location. Due to the role being outsourced, it is simple to expand or decrease your company's logistical reach without having to put up a dedicated infrastructure and staff on your own.
3. Inventory access in real-time
Professional logistic outsourcing service providers track inventory in real-time using cloud-based Warehouse Management Systems. For supply chain management planning, the service provider may also offer this data on a regular basis.
4. Skilful management of documentation
Providers of logistics outsourcing services have the specialised knowledge and experience needed to handle all the associated paperwork, such as interconnected carrier contracts, insurance certificates, certificates of origin, etc.
Cons of Outsourcing Your E-commerce Logistics
Outsourcing without an adequate evaluation procedure
Finding a reliable logistics partner is difficult. The actual appraisal procedure will involve getting estimates, completing quality reports to see if the service complies with benchmark requirements, and other steps. Rushing through the tendering process without following a well-thought-out procedure will cause problems later.
2. Absence of Custom Packaging
The fact that certain 3PLs won't allow you to utilise your own custom packaging is one of the main disadvantages of outsourcing fulfilment. Many 3PLs (particularly the bigger ones) require clients to adhere to their rigorous packaging standards, leaving no room for your own unique packaging.
3. There can be unpredicted expenses.
Taxes, delivery costs, and other undisclosed charges could occasionally get out of control. Some 3PLs charge additional hidden fees for labelling, pick-and-pack, packing, and other services.
4. Differences in platforms and software types
It's crucial to be able to monitor your inventory levels, product performance information, and order status. However, each 3PL provider will have a unique platform and software programme for online courier service. This implies that rather than getting a single comprehensive report, you will have to gather information from several sources and build a report on your own, which can be difficult and time-consuming.
Also read: Why Your eCommerce Needs a Blog Booster Shot
Conclusion
In order to enhance your company’s e-commerce logistics, it is important to carefully evaluate and analyse the various facets of outsourcing fulfilment, so that you make the best decision with respect to your business needs, by choosing a reliable online courier service provider.
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