Commerce Trends

by Manhattan Associates

The Profitable E-Commerce Order Fulfilment Challenge


Hannah Watkins, Senior Consultant from Manhattan Associates shares her thoughts….

In an increasingly globalized supply chain landscape, the ability to provide efficient and effective e-commerce order fulfilment is still a high priority for many businesses. However by entering a competitive e-commerce arena, there are several significant challenges that must be overcome to also make e-commerce order fulfilment profitable.

Product Availability and Returns

istock_000015191658mediumVisibility of inventory and product availability throughout the supply chain is of course always important, yet this becomes critical when fulfilling e-commerce orders. Maintaining accurate inventory levels ensures that once a customer’s order is placed, the chances of not being able to ship it due to stock unavailability are greatly reduced. Being able to meet the customer promise consistently and reliably, strengthens customer loyalty and increases repeat orders.

However, this is just one half of the battle. Successfully reverse engineering a supply chain to seamlessly manage the inherent higher rate of e-commerce returns is still a substantial obstacle. Making best use of this returned inventory wherever possible and as quickly as possible is vital in driving maximum inventory profitability.

Maximizing Productivity

With an increase in low quantity, multi-item orders the total effort to fulfil a single e-commerce order is increased. Add to this significantly reduced lead times and the need for supply chains to be more flexible becomes essential. Often the additional challenge of integrating e-commerce operations with more traditional store order fulfilment channels adds a further layer of complexity.

Moreover, e-commerce overall order volumes are less predictable and can fluctuate throughout the week, season or year. Being able to scale, manage and track progress quickly allows agile supply chains to react in the most efficient way. This is fundamental in driving profitability when an e-commerce order waves hits.

Customer Experience

Ensuring that the end consumer is at least satisfied with all customer facing aspects of the supply chain process and where possible exceeding expectations is the ultimate aim of any e-commerce offering. Providing additional services, such as transparent shipping so that the customer can track or change their order and value added activities like gift wrapping or personalization are becoming more commonplace and central to supply chain processes. It is no longer enough to simply ship the inventory to the customer.

Furthermore with an increase in e-commerce delivery options such as instore collection, drop off points or home delivery, combined with various challenging delivery time frames, flexible shipment planning is key in maximizing e-commerce order shipping capabilities.  Often referred to as the ‘Last Mile’, this is an opportunity where e-commerce profitability can be won whilst meeting increasingly demanding customer order delivery expectations.

Find out more about how Manhattan Associates can help drive e-commerce profitability in an omni-channel supply chain by visiting our website