the cost of capital increases. It also adds complexity. Rather than predict one set of demand, companies have to predict multiple sets. Companies can consider other ways to accelerate order speed. One is streamlining processing and ful llment, so orders quickly move out the door. Another is negotiating with carriers to hand off orders later into the evening. “If you get these right, you can overcome other competitors that have more resources,” says Chris Ball, chief executive of cer with BW Retail Solutions, which offers end-to-end e-commerce solutions. SUPPLY CHAIN CONTROL Just how much control do e-commerce retailers need over their own supply chains? “It’s incredibly valuable to control your own supply chain and your own infrastructure,” Ball says. That’s especially true as companies increasingly need to capture consumers wherever they are, whether that’s social media, online marketplaces, or brick- and-mortar stores. Yet, for all but the largest e-commerce companies, complete vertical integration is unrealistic. The investment required to own all the supply chain infrastructure will be outside most budgets. Companies also need to consider how quickly they need to scale their operations. If their time frame is tight, they’ll likely nd working with a logistics provider a practical strategy. Companies can work closely with their logistics providers to align expectations. Shopify found that 44% of brands were investing in closer collaboration with their supply chain partners. Caraway, for instance, treats ITS Logistics as its partner. “We are vocal and transparent about what we expect,” Riskowitz says. “At the same time, we treat our partners the same way we treat our customers.” Along with boosting ef ciency within a warehouse or distribution center, successful e-commerce companies need to move orders to consumers quickly and accurately.
calculable costs that are hard to ignore. Advancing inventory management solutions can provide accurate, updated inventory records, lowering the risk of both dead inventory and stock-outs. For instance, RFID scanners embedded in the ceiling of a store or warehouse can count inventory units out tted with RFID tags at a rate of 12,000 to 18,000 per hour. “It’s a high-speed way of counting,” Nuce says. CENTRALIZE OR DE-CENTRALIZE? Allocating inventory across multiple locations can help supply chain organizations meet increasingly tight delivery time frames. For example, Hairbro.com, which offers hairpieces and wigs to customers globally, is boosting the number of its last-mile delivery centers by 10 to 15%. These centers are responsible for moving goods from warehouses to their nal destinations. The company is also establishing small, automated micro-ful llment centers that can offer same-day delivery service. “As more individuals shop online, companies need to have a speedy and effective way to supply their products,” says Adam Gar eld, Hairbro’s marketing director. At the same time, distributing inventory is expensive, particularly as
trade show leads, has seen business grow signi cantly in the past year, resulting in many time-consuming, repetitive tasks. To address this, Trade Show Labs is implementing software that will introduce automation to collecting and tracking inventory, assessing compliance, and scheduling updates, among other functions. “It eliminates human errors and allows people to focus their time and efforts on actually running their business,” says Maria Britton, the rm’s chief executive of cer . CONSIDERING RISK Before the pandemic, many organizations “had ne-tuned just- in-time inventory management like a Maserati,” says Ed Romaine, vice president, marketing and business development with Conveyco, a provider of warehouse automation. They slashed costs but were vulnerable to disruptions. Since disruptions likely will continue, organizations have to consider just-in- time inventory management through a lens of risk, including the risk of lost sales because they lack inventory. The challenge? The customer dissatisfaction that results from lost sales is dif cult to calculate, but it can kill a business. Conversely, holding extra inventory imposes bottom-line,
As sales jump and labor costs rise, e-commerce companies increasingly turn to automation, such as autonomous mobile robots, to help manage inventory and process orders.
January 2023 • Inbound Logistics 105
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