E-commerce poses many challenges

As a multi-channel service provider, we have to master services such as the daily inspection of goods, receipt of goods, reconditioning, return to the available goods cycle, customer account discharge and complaints processing as standard and solve them quickly and competently in the interests of the client," answers Thomas Krüger, Managing Director of BLG Handelslogistik, when asked what ideas his company wants to use to score points as a partner to e-commerce companies.

"In our logistics center in Frankfurt, we have been using a mobile, scalable and efficient storage and picking solution for our customer from the workware sector since 2014, which we use to process some of the returns for our customer. As fast returns processing increases customer satisfaction and improves the availability of goods, we were the first company in Europe to implement a robot-supported logistics concept in which people no longer go to the shelves, but the shelves with the goods come to the people," reports the manager proudly.

"We have to master all the services in demand"

Thomas Krüger Managing Director of BLG Handelslogistik Photo: Jan Meier

The decisive criterion for the installation was the scalability of the system. Customers expect ever shorter delivery times, which also makes same-day delivery important: "We assume that the option of time slot delivery and delivery within an hour will be a crucial part of the shopping experience in the medium term. As we also expect a shift towards regional structures as a result, we are currently designing and implementing regional solutions in many customer projects," says Krüger.

Enormous potential for logistics service providers

Tobias Lenhart, responsible for e-commerce solutions product development at DB Schenker, sees enormous potential for retailers and manufacturers in e-commerce. As a long-standing, reliable partner in the consumer goods market, DB Schenker already offers sophisticated, high-quality solutions for this market, which it intends to gradually expand in 2018. "The focus is on the needs of the customer. Whether a pure player with purely contract logistics needs, a medium-sized company on its way into digital markets or a start-up with high growth expectations - DB Schenker offers the right services and does not limit itself to pure logistics. In 2018, customers can choose from various services ranging from logistics and returns management to individual web stores. The modern solution from a single source offers many advantages: A simplified IT landscape, short communication channels and a fast go-live. The consistently high quality and flexibility of the processes ensure that online shopping is a positive experience for customers and retailers," Lenhart outlines the logistics service provider's strategy in an interview with materialfluss.

"The focus is on the customer's needs."

Tobias Lenhart DB Schenker Photo: DB Schenker

"Click & collect, click & reserve, order in store, same-day delivery or dropshipment with individualized products for the end customer - these are just a few of the requirements that retailers and brands are constantly faced with. Amazon sends its regards, sets the standard and takes the sales. Best practice is all well and good, but the strategies and opportunities contained in the eCommerce potpourri pose many a challenge for logistics and the balance sheet," says Lars Feldscher, Senior Vice President at Hellmann eCommerce.

There are also questions such as "Fulfill from store? Stock available in store? Split orders? Return to store?" Customer centricity and happy customers are important, but often have a negative impact on the profit and loss account. That doesn't have to be the case. Ann-Kathrin Käuper, Junior Sales Manager and colleague of Lard Feldscher, describes the following example of customer focus and cost reduction: "Let's take a closer look at the Click & Collect consolidation in the omnichannel area, which we implemented for one of our largest eCommerce customers. The actual situation was as follows: Several Click & Collect orders per store are regularly sent individually to the stores each day. Shipping and cardboard packaging costs are incurred for each package. With the help of our order management system (OMS), which guarantees e-commerce processes, we merged the Click&Collect orders per store in the warehouse and thus only sent one parcel per store. The end customer orders were pre-sorted in advance and individually packed in polybags, including all shipping documents. Consolidation in the warehouse allows us to combine up to 30 percent of all Click&Collect orders, saving us several 100,000 euros a year in transportation costs alone. Added to this are the packaging materials that are no longer required."

"Consolidation saves many hundreds of thousands of euros in transport costs."

Ann-Kathrin Käuper Junior Sales Manager Photo: Hellmann eCommerce

Another example is the dropship process with individualized products - be it with your own first name, favourite color, logo - are more popular than ever and are driving up sales figures. As well as the logistical effort. "Here too, our OMS has enabled us to develop a process for our international eCommerce customer that allows us to customize the product directly in the manufacturing factory. From there, the order is sent directly to the customer without incurring storage or other transportation costs," reports Käuper.

"Amazon sends its regards, sets the standard and takes the sales."

Lars Feldscher Senior Vice President at Hellmann eCommerce Photo: Hellmann eCommerce

"We help to turn returns into a business"

The huge losses that well-known online giants have been making for years indicate a system error that is not exactly making e-commerce scream with happiness, explains Matthias Schadler, Managing Director of pfenning logistics. It is a well-known fact that the extremely high returns rates are what is ruining business for the players. Studies show that four out of ten orders in Germany are returned to the sender. In fashion mail order, up to 50 percent of goods are even returned by consumers.

"Our strategy is to think about the supply chain from the end, i.e. from the recipient's perspective. What should packaging look like to enable problem-free returns and ensure that the goods reach their destination undamaged? How informative are product descriptions? Are virtual try-ons or 360-degree views possible? Can payment systems be used to ensure more "order discipline" for online customers?