Drop-shipping is a useful type of e-commerce fulfillment service where the retailer (you) purchases products and sends them to customers in response to orders—without using a standing inventory. Since you don’t have to maintain inventory stores, drop-shipping margins are usually higher than other methods. However, businesses that use drop-shipping will also face certain challenges that other types of fulfillment services do not readily encounter. Here are two of the more common challenges that drop-shipping can face, as well as the most apt solutions.

Order Visibility

Many challenges with drop-shipping arise in some fashion due to the lack of control you have over the vendor or manufacturer. This can create disconnects in information and make it hard to give customers the visibility on their order that they might want or expect. Solving this challenge, therefore, involves fostering communications between you and the supplier.

Get Clear Lead Times and Availability

Customers will appreciate being told upfront what their expected delivery time might be. In order to provide this information, you need accurate lead times and product availability data from your vendors. Devising systems that can collect this information and update delivery estimates and availability based on these inventory feeds can help inform customers at the point of purchase.

Sync Up

Your order management system has a large role in keeping you informed of what is going on with your vendors. Ideally, you will be able to get vendors to confirm purchase orders and verify your estimated delivery dates. This information can then be put into your own systems and shared with the customer.

Be Proactive

It is imperative that a part of your drop-shipping procedures is to track and follow up on any orders that become late. Contact your vendor and find out what the status is and the new delivery estimate. You also need to contact the customer as soon as possible since they will know when the order is late and some proactive action on your part can go a long way to retaining their good will.

Limited Branding

Since your engagement with the customer effectively ends once they make the purchase, it can be tricky to establish a clear branding image when using drop-shipping. This is an issue since branding your order fulfillment services helps build repeat customers. Without strong branding, you limit your ability to stick in your customer’s mind even if the service itself is excellent. Fortunately, there are ways to overcome this challenge.

Packaging Inserts

Including marketing inserts in your shipments, such as catalogues, brochures, coupons, etc., can help reinforce your brand while offering a sort of call-to-action towards future business. Another approach is to include something fun that can express your brand’s personality and put a smile on a customer’s face. What that “something fun” might be, of course, is up to you, but one example might be seasonal cards or holiday wishes.

Customized Packaging

If your vendor allows it, arrange for custom elements in your packaging. This can include things like labels and package tape bearing your logo or even offering your own custom-printed packaging materials. At minimum, you should be able to include a branded packing slip that contains your logo, contact information, and shipping policies.

Follow Up

Taking the time to follow up with your customer can help offer a more personal interaction with your brand. A follow-up can be in the form of a survey, courtesy call or e-mail, thank-you note, or other method you consider appropriate. In addition to possibly garnering useful feedback, follow-ups help keep your brand at the forefront of the customer’s mind and make you stand out better against competitors.

Look to Lean Supply Solutions for Drop-Shipping Success

Lean Supply Solutions is a third-party logistics (3PL) order fulfillment company in Toronto whose operations are based around the Lean Methodology, a proven philosophy focused on eliminating any operations, equipment, or resources that are not capable of adding value to clients’ supply chains. By striving to ensure that the right products are provided to the right customers at the right time, Lean Supply Solutions is able to offer consistent, accurate, and quality results.

To learn more about the Lean Methodology, outsourcing to Lean Supply Solutions, or to ask any questions, give us a call at 905-482-2590.

“Big data” is the term used to describe data sets that defy traditional methods of analysis due to their complexity, and often, the way they represent human behaviours. Although the crunching of these types of numbers can be daunting, big data analytics has a key role in modern supply chains. Big data is just one part of the rapid rise of technology in supply chain services, and when used properly, it can help inform future demands and optimize current supply chain practices for better efficiency. Here are just some of the ways that big data analytics can shape your supply chain solutions.

Create a Unique Brand Experience

One of the most significant impacts of big data on supply chains is how it can offer information on the customer experience. Call centre logs, loyalty programs, customer surveys, web logs, mobile data, and more can all come together through analytics to create a 360-degree image of your customer’s needs and expectations. By taking these findings and using them to shape your processes and activities, you can deliver a stronger brand experience to your customers. This could be as simple as offering different shipping options and prices or as complex as redesigning delivery routes to more closely align with where the majority of orders are coming from.

Enhances Traceability

The use of data analysis in supply chain management is particularly well-suited for enhancing the traceability of your products. One of the most time and money-intensive activities a company can perform is trying to integrate and process disparate databases in order to track down products that have to be recalled or retrofitted. This is an intensely data-driven activity by definition and it is therefore fortunate that big data analysis is designed to work with such large, normally unwieldy sets of information. When used in this manner, big data will help to reduce the level of risk exposure in your supply chain.

Offers Stronger Demand Forecasts

Big data analysis pulls information from a multitude of sources in order to produce reliable and accurate findings, predictions, and demand forecasts that might otherwise get missed. For example, big data elements like on-shelf-availability, transaction data, purchase orders, competitor pricing, and social media monitoring can combine to detect shifts in customer demand and make appropriate forecasts about how this will impact orders down the line. This information can then be used to adjust inventory levels or production in order to avoid shortages or overstocking.

Look to Lean Supply Solutions to Harness Big Data Analytics in Chain Management

Lean Supply Solutions is a third-party order fulfillment company in Toronto whose operations are based around the Lean Methodology, a proven philosophy focused on eliminating any operations, equipment, or resources that are not capable of adding value to clients’ supply chains. By striving to ensure that the right products are provided to the right customers at the right time, Lean Supply Solutions is able to offer consistent, accurate, and quality results.

To learn more about the Lean Methodology, outsourcing to Lean Supply Solutions, or to ask any questions, give us a call at 905-482-2590.

Supply chains continually grow alongside your business, and the two typically build on top of one another over time. While effective, this tendency can lead to situations where processes and systems are not able to keep up with the eventual scale of your operations. Another problem is that solutions and arrangements that made sense at their time of implementation can begin to struggle with more modern realities. An important part of supply chain management is being able to recognize when this time has arrived and to take the steps necessary to bring about a revolution. By revising, replacing, and rejuvenating your supply chain, you can stay on the cutting edge of business success.

Enhance the Tech Side of Your Supply Chain

The technology used in your supply chain plays a large role in how agile and responsive operations can be. Even if you already have existing digital supply chain systems, it’s worth considering whether they are still up to the task or can stand to be improved or replaced. Take the time to do your research into in-house or best-of-breed, or third-party options and see what can meet your needs (present and predicted future) best. When making a technological transition, it is also important to make sure to get as many parties as possible on board. This can include your own workers as well as suppliers. Change is naturally disruptive, so everyone needs to understand the little bumps that will occur before the system is fully implemented and smoothed out.

Get Real-Time Visibility

This is a subset of the above point, but it’s worth emphasizing on its own. Being able to have real-time visibility of your supply chain is an advantage that cannot be underestimated. Not only does it let you spot and react to orders and events in real time, but you can use this information to keep customers better apprised of the status of their purchase. Between letting you stay agile and keeping customers happy, it’s easy to see why real-time visibility is going to become an expected feature of supply chains.

Collect Supporting Data

In addition to it simply being a good idea to have a data backup, collecting supporting metrics is often the first step in improving your supply chain. Without knowing information like inventory order rates, warehousing costs, inventory costs, data on shipping routes, and so on, you can’t find the spots that are most in need of improvement. Having this information on hand also makes it reusable so you can incorporate it into your new systems and/or future projects. Knowledge is power, after all.

Make Sustainability Part of the Supply Chain Strategy

The idea of a sustainable supply chain is worth embracing as part of your revolution both from public relations and practical standpoints. Taking steps to minimize energy consumption, packaging materials, and maintaining a robust reverse logistics process are all able to help you save and recoup costs while doing a bit more to help the environment. These achievements can, in turn be used to enhance your appeal among customers and garner goodwill and interest.

Look to Lean Supply Solutions for Effective Supply Chain Management

Lean Supply Solutions is a third-party order fulfillment company in Toronto whose operations are based around the Lean Methodology, a proven philosophy focused on eliminating any operations, equipment, or resources that are not capable of adding value to clients’ supply chain. By striving to ensure that the right products are provided to the right customers at the right time, Lean Supply Solutions is able to offer consistent, accurate, and quality results.

To learn more about the Lean Methodology, outsourcing to Lean Supply Solutions, or to ask any questions, give us a call at 905-482-2590.

Risk is an unavoidable element in any enterprise, and shipping and warehousing operations are no exception. Although there are many ways to reduce your exposure to different types of risk, these potential sources go up dramatically the larger and further-reaching your supply chain becomes. Global supply chains come with an inordinate amount of moving parts, each of which is subject to different risk factors. As the size of the supply chain services grow, so too does the cost of any one part going down or suffering fault. Consequently, it is integral to have a risk management process for your global supply chain that can not only reduce your vulnerability to risk but also let you recover quickly should an adverse event arise.

Upgrade Your Warehouse

Two of the larger risks in global supply chain management concern quality and inventory. Long global supply lines make it harder to respond quickly to quality concerns since tracking down the problem becomes a more involved process. A long global supply chain can also cause a surprising amount of additional inventory that can catch warehouse operators by surprise.

Upgrading your warehousing operations helps manage both of these sources of risk. Quality control is part of inventory management during warehousing, so enhancing this area of logistics management will let you recognize potential problems before they reach customers and start the investigative process promptly. Warehousing upgrades also help manage excessive inventory. This can be accomplished by expanding storage space or by devising more efficient means of handling goods. In both cases, your costs associated with the extra inventory will manage to go down.

Get a Disaster Response Plan

Chances are, you already have a response plan in place if your main warehouse or similar location is struck by a flood, earthquake, fire, or other disaster, but what about the rest of your supply chain? Proper supply chain management means taking a good, hard look at the flow of goods throughout your chain and identifying points of vulnerability from natural disasters like earthquakes or tsunamis, especially in Asia if the past five years are any indication. You won’t be able to avoid getting hurt if part of your supply chain is struck by disaster, but you should not be left scrambling to come up with a response since “in the moment” is one of the worst times to have to formulate a plan.

Use Real-Time Tracking and Visibility

This is related to the above point about disasters. Information is crucial to recognizing and solving problems, and delays in obtaining that information can dramatically increase the cost of any given risk. Being able to harness visibility tools for global shipment and component tracking, ideally in real time, lets you get an immediate view on your current situation. Should a risk manifest itself, being able to get accurate, real-time data of when, where, and how much of your supplies are impacted is key to reacting appropriately.

Work with Strong, Competent Suppliers

Global supply chains are, by definition, subject to the market conditions of multiple countries. Your suppliers may do business with you, but they are as vulnerable to local factors as anyone else. One of the risks that supply chain management must address is the potential impact of this vulnerability. Working with suppliers you trust and know to be well run and financially sound helps reduce the uncertainty associated with this additional risk. Being able to trust that your supplier will still be able to operate in the event of market shocks or legislative changes helps maintain the integrity of your overall supply line.

Look to Lean Supply Solutions for Effective Supply Chain Management

Lean Supply Solutions is a third-party order fulfillment company in Toronto whose operations are based around the Lean Methodology, a proven philosophy focused on eliminating any operations, equipment, or resources that are not capable of adding value to clients’ supply chains. By striving to ensure that the right products are provided to the right customers at the right time, Lean Supply Solutions is able to offer consistent, accurate, and quality results.

To learn more about the Lean Methodology, outsourcing to Lean Supply Solutions, or to ask any questions, give us a call at 905-482-2590.