How to manage the logistics of an omnichannel industry

Omnichannel management strategies are the order of the day, as they offer a more complete shopping experience across channels such as physical stores, online stores, apps, among others. In addition to that, according to the Spanish Confederation of Commerce (CEC), more than 50% of consumers have visited both physical and online channels. Therefore, for the logistics department, an additional layer of complexity is applied so that it can meet its objectives smoothly.

In general, to adapt operations towards omni-channel logistics, the strategy must be customer-centric and linked to other departments such as sales and marketing. But the question is whether omni-channel logistics differs much from other more conventional strategies.

In order to know the ways to manage omnichannel logistics, the following points have to be taken into account:

System digitization

Once an omnichannel strategy is established for the company, it is essential to have a centralized logistics management system to keep all data on inventory, orders and shipments up to date and to receive them in real time. This is known as logistics 4.0.

To do this, it is necessary to look carefully or rely on experts in the field to choose the best solution that connects and keeps all the data updated with the database systems that the company already has. Whether it is an ERP with logistics modules or a more specific solution such as an inventory manager or a WMS, or even, to optimize transport management, a TMS.

Omnichannel order picking

The growing trend of e-commerce and, therefore, omni-channel logistics has marked a turning point in the way orders are prepared. It mainly consists of adapting picking and packing strategies to focus mainly on the preparation of orders to customers without relying on the distribution channel.

For example, boxes have become the packaging of choice for direct shipments and for multi-unit orders, i.e. orders of multiple different items and small quantities. Another important element to consider is the distribution centers or logistics nodes through which orders must be prepared that are closest to the customers, even when reverse logistics must be managed.

Flexibility in shipments

If you decide to apply an omnichannel strategy in both the sale and distribution of orders, you must offer the customer the option of different shipping options. Among these options, the most frequent are the following:

• Home delivery: This is undoubtedly the most popular option of all, both on the part of the customer and on the part of the transport services, but the most expensive in terms of fuel and delivery attempts. Your service can range from standard delivery to express delivery.
• Pick up at physical store: Known as Click & Collect, this is a more economical option in which the physical store of the customer's choice receives the product and it is the customer himself who goes to pick it up. It reduces last mile costs and has the potential to offer a more satisfying shopping experience.
• Convenience points or smart lockers: Similar to physical store pickup, with the difference that third parties outside the store pick up the product and hold it for a period of time until it is picked up. They consist of other stores outside the e-commerce or smart lockers.

The combination of different shipping options aims to offer an omnichannel shopping experience to customers. Apart from that, it has its advantages to leverage both online and offline distribution channels.

Suitable transportation and logistics options

If previously one or two transport companies were used to make deliveries, when implementing an omnichannel strategy, more options of logistics operators are needed to cover the sales channels.

To do this you have to take into account the different ways that direct delivery can be given. It may be that the shipment is made from the distribution center, a store near the customer or opt for a method such as dropshipping and is sent directly from an external supplier.

Monitoring and follow-up

Geolocating shipments and monitoring their current status is essential to ensure that deliveries arrive on time. Particularly when there is an omni-channel strategy and orders are shipped through multiple channels.

This is because omnichannel is customer-centric and the demand demands transparency and knowledge of the status of their shipment 24 hours a day. In addition, tracking provides more agility when it comes to resolving any possible incidents that may arise in the shipment.

Conclusion

As we have seen, effective omni-channel logistics management requires a combination of technology, processes and innovative strategies, just like any other 4.0 logistics strategy. However, it must be kept in mind that all logistics is focused on the customer and meeting their needs.

At Hedyla we adapt the software to any specific use case, providing the necessary tools to both staff and carriers to report and have full control of the transport management.