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Solution for E-Commerce Logistics Concerns, Problems and Complaints
E-commerce is evolving, and as e-commerce evolves, so do the concerns, issues and complaints about the logistics performance of e-commerce.
Concerns, Problems, Complaints about E-commerce Logistics
According to TUIK data, the most important concerns of e-commerce customers are delivery cost, delivery speed and returns, which are directly related to the logistics performance of e-commerce, while the most important problems related to e-commerce are slower than specified delivery, high delivery cost and delivery of wrong or damaged products, which are also directly related to the logistics performance of e-commerce.
According to Şikayetvar data, e-commerce and cargo-shipping sectors are among the top three most complained about sectors, and complaints related to the logistics performance of e-commerce such as returns, non-delivery of the product, incomplete or incorrect product delivery, damage and loss of products, long delivery time, prolonged delivery time or delayed delivery, failure of the products to reach the address, behavior of cargo personnel come to the fore and these complaints increase especially during the “Legendary Discounts” periods.
The Performance of Logistics Affects the Performance of E-Commerce
The basic three processes of e-commerce are receiving the order from the customer, preparing the order and delivering the ordered goods to the consumer.
The second process, order preparation or, in popular parlance, fulfillment, is a process that starts with the customer placing an order, continues in the warehouse and ends with delivery, and includes the storage of goods and picking of orders, value-added services if necessary, packaging (special packaging such as gift wrapping if necessary), preparation of the order for delivery, and the third process, order delivery or, in popular parlance, Last Mile Delivery, involves the delivery of the products (order) to the consumer.
Two of these three processes, namely the preparation of the order and delivery to the consumer, include logistics activities for e-commerce, so it would not be wrong to say that 90% of e-commerce involves logistics activities (e-commerce is actually logistics) and that the performance of e-commerce is positively or negatively affected by the performance of logistics.
The performance of logistics activities, which constitute the majority of e-commerce, affects the performance of e-commerce, and perhaps due to logistics-related problems, the customer does not completely give up traditional retail shopping. This is because in traditional shopping, the customer uses (enjoys) the product that he/she has paid to the store immediately and can return it to the store immediately. In e-commerce, on the other hand, the customer waits for a few days to use (enjoy) the product they have paid for and experiences many difficulties in returning it.
Unless there is irradiation, the ordered goods must be stored somewhere and somehow transported and delivered to the consumer. Therefore, the logistics of e-commerce is the process by which “virtual” trade, i.e. e-commerce, becomes “real”. Trade can be “virtual” but logistics cannot be “virtual” until teleportation is invented.
Customers’ Preferences (Wants)
Today, customers, who have started to attach importance to delivery conditions as well as the price of the product, leave the website of e-commerce sellers (marketplace, independent site) with high delivery costs and long delivery times compared to alternatives, or do not shop again from e-commerce sellers who cannot deliver the product within the promised time. In addition to delivery conditions, customers who experience difficulties in the return processes of the product do not shop from companies that cause difficulties.
Favorable delivery terms can increase the potential customer’s conversion rate (Conversion Rate) and decrease the potential customer’s abandonment rate (Card Abandonment). If the promised delivery terms are met, Customer Lifetime Value may increase and the customer may continue to shop with the same e-commerce merchant.
E-commerce customers may prefer those that offer more sustainable and green delivery options; they may buy brands that offer environmentally responsible delivery options, pay extra for environmentally responsible delivery(or even forego free delivery).
Customers who used to buy based on screenshots (and comments, if any) and pay in advance are now asking and demanding “how soon can I get it?” and “how environmentally friendly are the products and their delivery?”.
As retail evolves, the logistics of e-commerce must also be restructured to address direct concerns about logistics performance, avoid problems and complaints, and respond to customers’ preferences for cheaper, faster, greener choices.
Existing Logistics Practices
Unfortunately, the concerns, problems and complaints directly related to the logistics performance of e-commerce increase significantly every year compared to the previous year, indicating that the current logistics practices for e-commerce are inadequate and different logistics solutions are required.
Is it possible with current logistics practices to eliminate concerns, prevent problems, avoid complaints, make e-commerce more profitable, and also, for example, delivery within a maximum of 2 hours, zero environmental, air, noise pollution due to product delivery, instant exchange of returns, almost zero damage, instant response to order changes (delivery location, delivery time, quantity, size, color, etc.), and no notifications such as “We were not at home”?
Customers want quicker responses to order changes, shorter delivery times, environmentally responsible logistics and hassle-free returns. E-commerce companies must meet these demands, but unfortunately these demands are very difficult to meet with current e-commerce logistics practices.
Both in Turkey and around the world, e-commerce companies and cargo distribution companies are trying to find solutions by focusing only on the “wheel turning” part defined as “Last Mile Delivery”. However, solutions should be developed and implemented by looking at the whole of the second and third processes mentioned above.
E-commerce companies, virtual fitting, Internet of Sense, Search and Order by Voice, Search by Image, VR (Virtual Reality) shopping, Artificial Intelligence Chatboks (AI Chatbots), etc. In addition to these, customers should focus on and implement logistics solutions that will enable “delivery within maximum 2 hours (or even 30 minutes)”, “free delivery”, “hassle-free, effortless, instant return”, “zero environmental, air, noise pollution due to product delivery” that customers will say “no way Lebron”.
The current logistics practices and logistics structure are not sufficient to address the aforementioned concerns, to prevent problems, to avoid complaints, and to respond to customers’ demands for “cheaper”, “shorter time” and “greener”. Different, radical and technology-oriented solutions must be developed and implemented to address these concerns and even to make customers say “No more Lebron”. This solution could be the “Last Mile Storage” model created by DepOrtak.
Gains with Last Mile Storage
Last Mile Warehousing can be the solution to address existing concerns, prevent problems and ensure no complaints, as well as better, easier and leaner management of distribution and returns for e-commerce.
E-commerce customers’ desire for “shorter time” and “greener” can be realized with Last Mile Storage.
The Last Mile Warehousing solution enables delivery to be made at the time or location requested by the customer, rather than leaving a “We’re here but you’re not home” note on the door, and the consumer can even pick it up themselves from micro e-commerce warehouses within walking distance if they wish.
Last Mile Warehousing simplifies the returns process and can be a hassle-free and fast solution for returns. If the consumer wishes, they can bring the product they want to return to the micro e-commerce warehouse within walking distance, where it will be checked by experts and an immediate exchange can be provided.
Product costs can be reduced with Last Mile Warehousing. By shortening the process of existing e-commerce logistics and reducing the cost of these processes, the Order Cycle time can also be shortened and the cost of the Order Cycle can be reduced. Packaging costs can be reduced by the fact that products can be delivered only in sales packaging instead of e-commerce parcel boxes or bags used to prevent damage due to the products being on the road for a long time and handled at different transshipment points. As a result of the shortening of the logistics process and especially the removal of cargo transshipment, the risks such as delay, damage, loss and the costs related to these risks can be eliminated as it will shorten the movement time and distance of the products. In addition, the order delivery process can be simplified and leaned by shortening the distance and time of product movement and eliminating waste in the process.
Risks can be reduced with Last Mile Warehousing. As a result of the shortening of the logistics process and especially as a result of the removal of cargo transshipment, risks such as delay, damage, loss and the costs associated with these risks can be zeroed as it will shorten the movement time and distance of the products.
With Last Mile Warehousing, the order delivery process can be simplified and streamlined by reducing the distance and time of product movement and eliminating potential waste in the process.
By reducing the cost of carrying inventory, Last Mile Warehousing can reduce the total cost of the entire process from order placement to delivery.
Last Mile Warehousing can increase e-commerce sales by improving customer satisfaction with 2-hour delivery and effortless fast returns, as a logistics solution for regional marketing or sales at events (for people coming to the city for a match…) or Livestream Shopping, and by increasing the conversion rate of website visits to sales.
The most important benefit of Last Mile Warehousing is that it supports individuals and micro or small companies who want to do e-commerce to work more easily and accurately. Thus, individuals and micro or small companies can have logistical competence.
Last Mile Storage with DepOrtak
Last Mile Warehousing is the creation and distribution of micro-ecommerce warehouses close to the consumer that enable delivery within a maximum of 2 hours of order placement. These micro e-commerce warehouses will provide warehousing services like the large fufillment centers currently in use, provide value-added services, deliver products (orders) from there to the consumer, and also act as a returns management center.
NOTE: A customer is the person or organization that purchases the good by making a payment, while a consumer is the person or organization that uses the good. A customer need not be a consumer, while a consumer can also be a customer.
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