Supply chain as part of Customer Service strategy fuels E-tailing

E-tailing (electronic retailing) has revamped shopping experience by transforming it to a ubiquitous anytime activity through digital channels providing an efficient and cost effective customer experience. With global retail e-commerce forecasts showing impressive growth over the next few years within both large and emerging markets, it is indeed necessary that companies revive their supply chain and logistics tactics and management as it is a major e-tailing enabler. In other words, the underlying backbone of e-retail is the supply chain strategy. The concept of supply chain encompasses vertical and horizontal integration with parties involved such as manufacturers, transporters, warehouses, retailers and customers, and functional units like new product development, marketing, distribution, customer service, operations and finance.

According to a research, State of the Retail Supply Chain (SRSC) Report 2015, strategic priorities that retail supply chain executives identified for the current market scenario are :-

• Enabling omni-channel growth – With escalation of mobile commerce, the e-tailing landscape is changing faster than ever before with retail taking an omni-channel approach. So, the trend is changing on how companies need to handle the orders and therefore, the delivery process. 
  

• Establishing essential infrastructure – Redesigning a more dynamic supply chain requires infrastructure demand alignment via building of fulfilment networks, improving the existent one for better utilisation through automation or using the store network as distribution points. IT systems and capabilities need to ensure a seamless and visible end-to-end supply chain process.
  
• Maintaining smooth transportation flows – Cutting down supply chain costs has been a pain for companies and logistics takes the centre stage with increased geographical reach and economic & political anxieties.
  

• Facilitating inventory access – Keeping inventory is a large and expensive investment. The “one inventory” concept is gaining traction as supply chain executives seek to increase inventory access, productivity, and velocity ensuring that inventory is readily available for cross-channel deployment. 
  

For companies to increase the productivity and in turn, leverage this e-tail growth, they have to cater and at times anticipate their customers’ needs in an attempt to lead the competition and simultaneously generate profits. When a customer requirement is triggered and recorded via an order, that very moment the supply chain activities start rolling. Still when companies are looking for cost-saving, customer service often takes the blow as compared to supply chain activities. By having a well planned order processing, invoicing, and product delivery management processes, companies can not only improve customer experience by delivering the right product at the right costs at the right place at right time and in the right condition, but hit the bottom line positively as well. In case of companies running out of stock or urgent delivery demands, inventory control, warehouses and tie-ups with logistic partners are necessary to fulfill the consumers’ needs. For instance, since February 2014, India’s leading e-tailer Flipkart is allowing its logistics arm, eKart Logistics, to deliver competitors’ packages. By having an effective reverse logistics as a customer service practice, companies can satisfy the operational aspects of returns and manage any customer retention issues. The ease with which a customer encounters returns strengthens their long-term relationship with a company. By spending money upfront to develop reverse logistics, companies establish customer service best practices throughout a product's life cycle reduce spending and boost revenue all at the same time.

Consequently, customers can drive revenues through advocacy and attract future customers through recommendations which further helps in establishing the brand. The standard of customer service and how successfully a company has implemented the services across the supply chain is therefore directly reflected on the profit margin. With the shift in focus to transform the customer services unit from cost centres to value centre and then to profit centres – companies must make sure that their supply chains are incorporated with the latest technologies, while blending harmoniously with the customer experience strategies.


Author: Debaleena Debnath 
Debaleena is a digital media consultant @ speradigital.
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