Expanding into the eCommerce world can easily overwhelm your existing business. It is not easy to provide your customers the service level they expect with an acceptable operational cost. In general, customers expect:
- To order your goods at a competitive price
- The goods to ship the same or next day
- Tracking information to be emailed or texted as soon as the goods are shipped
- The goods to arrive on time and as ordered
This channel is typically very distinct from a B2B channel and may require a completely different system and inventory management solution. If you are leaning towards implementing an omni-channel experience, it is important to understand how to adopt the solutions and processes needed to ensure the desired customer experience. While the concept of creating a separate set of processes and system solutions is difficult to implement in sales and delivery, it is particularly difficult to provide a similar omni-experience in the return and repair business. Any new solution should be fully vetted before implemented. Partial implementations could be costly and a disastrous experience for the consumers. You may end up asking yourself, “why didn’t we just give our customer better visibility?” Below is a simplified view of an eCommerce solution that can work for both B2C and B2B channels.
In addition to implementing the right solution that can handle multiple channels, managing your inventory well can save your company millions of dollars. It is standard operational practice to make decisions on how much to stock and where to store it. But making more complex decisions on the type of inventory to store can enable real operational efficiencies. For example, when transportation costs are relatively low, shipping finished goods from China into the US for distribution may be the easiest, lowest cost solution. But, if it is predicted that transportation costs may be going up or sales kit packaging is getting bigger to enable more shelf presence, postponement strategies can yield the best results. See the image below showing each scenario where increased transportation costs can shift the delivery model towards postponement.