Tuesday, 14 May 2013

Online Retailing and Order Retailing

Chain management has become a major challenge for many online retailers since the online shopping boom took off. Chain management and supply chains in general may differ from business to business, but similarities are often found in their common characteristics.

·    High Visibility 
Visibility is vital for all areas of the business and for the customer. With the help of information technology, supply chains are more visible, data are collected virtually on the moment the order is placed till it is delivered. The data are available to all those in-need in real time.

·    Logistics & Trust Building 
Retailers need the trust from their customers. Delivery speed is one of the factors that helps to build-up trust and retain customers. Without a reliable logistics, customers are not likely to continue the business relationship.

·    Large Scale Operations
With the limitation on floor size for stock storage, it becomes a fundamental factor to be considered for warehousing and distribution stocks on retailing.

·    Assembly of Order
To reduce the delivery costs, retailers/customers often assemble the order to one shipment which they could profit by bundling the order and sending one shipment.

·    Delay in Demand Fulfilment 
Online retailers could exploit the time between the demand of the customer and the final shipment to increase profits. Hence, retailers are able to use more time to explore alternate means of delivery to reduce shipment cost.

Logistics·    Retailer-oriented Demand Allocation.
An online portal is the only channel for customer to buy from online retailers. 

Customers often have no control over the experience and demand on how the items purchased are delivered. Retailers have advantage by using different warehouse and shippers options available to reduce operation cost to meet different delivery demands.

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