How Logistics Remains The Last Barrier To eCommerce Domination

I think there is a general misconception that eCommerce is all about design and marketing. While that is somewhat true, I really believe the key to eCommerce lies in great operations.

If you can’t ship the product out fast and cheap, your costs will either be too high to be profitable or you will be too slow to keep customers happy. Ultimately you’re competing against Amazon-level convenience which is a daunting task. A great product might help, but many consumers will even choose a lesser product or pay more for convenience.

Why is logistics the last barrier? Simple. Last-mile delivery is expensive. Last-mile delivery as well as shipping larger items is simply tough and expensive. Even companies like UPS use USPS for last-mile delivery.

So What are your options?

Your Own Warehouse:

Some companies have their own warehouse or warehouses and the ability to ship products themselves. If you have your own warehouse this can provide a local advantage for last-mile delivery.

3rd party Warehouse Providers

3rd Party logistics companies that provide warehouse and shipping services such as ShipBob and Ruby Has can expand your logistics capabilities without having to invest massive costs into your own warehouses.

FedEx, DHL, UPS, USPS

Obviously, the major carriers should play a role in your shipping process. They can help augment your own shipping if you have them and give you the flexibility to choose the best rates among the top 4 providers.

Smaller Carriers

There are many smaller carriers like old dominion that may have competitive advantages in localized regions. You can use these to beat competitors in specific regions by offering more options and perhaps a more competitive option for those areas.

Your Own Shipping Carriers

Having your own shipping is obviously the best advantage if you can afford it. Unfortunately, it is very expensive to do this well. Perhaps focus on specific areas you can excel at like a local region or type of transportation.

New Technologies For Last Mile

I believe we will see more last-mile delivery technology advancing than ever before. Between automated cars and robots to Uber-like networks, we will see a revolution in last-mile delivery. Keep an eye out for whats new, and the early adopters may be the ones that completely transform their business online.