September 22, 2020

The war to deliver the order faster | Fortune



With electronic commerce, stores remain open 24 hours a day. This implies a series of conditions, which make this channel be conceived as something more than the simple fact of making a purchase, since a service is also contracted. This is what the marketing professor of Deusto Business School Imanol Torres, who details that in the last five years, especially in retail, when an online purchase is made there is a double axis to take into account: “on the one hand, greater comfort, the operation is very easy to do, and on the other hand, saving time ”.

This means that in addition to save on travel, the process from when the purchase is completed until it is received should be as short as possible. And here it comes into play, especially it has been revealed with the pandemic, logistics, with the new operators, Amazon or Alibaba, which also act as giants of commerce. “They offer a very sophisticated service, they have been improving in this convenience service, since you know that if you find any product you will receive it in record time. That is the value, for example, of Amazon, in electronic commerce, ”says Torres, who highlights that in addition to offering this service, it is linked to a specific buyer, a premium customer, and that is one way any other to build customer loyalty.

It has been precisely in this health crisis, points out Óscar Martínez, commercial director of Value Added Logistics of the group Berge, when this area that “had already been treated as fundamental in the management of supply chains in a global-local environment, mainly with regard to deadlines, times and inventory management” has become more relevant, due “to the need to guarantee supply of food, health and pharmaceutical products, and fuels, in addition to generating efficient inventory management and optimal maintenance of stocks that guarantee this supply ”.

Moreover, he believes that this crisis has made the sector advance over time. “We are facing a new paradigm where the consumer has very high demands in terms of delivery times. All this makes stock management and last mile logistics are essential in a market that aspires to have weight in industrial logistics, which will mean greater infrastructure needs for the management of the supply chain and will allow operators to be present throughout the process until delivery to the end customer ”, explains Martínez.

Technology and innovation are key to meeting the growing demand for electronic commerce, “because they help manage very tense flows, plan based on forecasts and historical data, working with algorithms that help manage stocks or optimize delivery routes ”, adds the Bergé executive, who believes that the integration of the supply chain makes the management and delivery of the product to the customer more efficient.

The war over delivery deadlines is open, says the Deusto Business School teacher, who cites cases such as Amazon, “challenging, since it makes the industry nervous globally”, or Walmart, which are triggering a race for the fastest delivery. “They are raising the level of demand within the industry, especially in distributors who come from the physical world, relying on their own stores and offering services similar to those of their competitors,” continues Torres.

In fact, he cites the advance of artificial intelligence at the service of the last mile, that is, initiatives that seek to transform the delivery method of electronic commerce orders, and incidentally contribute to modifying the landscape of cities, through drone deliveries by Jeff Bezos’ company, or the use of autonomous vehicles by the American discount department store giant. All of this remains to be seen if it works, since every 10 innovation projects there is a very low percentage that is consolidated. “The greater the disruption, the greater the possibility of failure”, warns Torres, who also cites the case of Inditex, as an example of the ability of a distributor to adapt to the new times, since it has been an accelerator of the transition from the physical store to the online, focusing on the collection and return of the garments at the premises.

Among the keys to guaranteeing a good logistical operation, according to the Bergé group manager are the optimal management of sustainability, technology and innovation, as well as flexibility, in order to be able to serve the market in the best conditions. But Martínez clarifies that, perhaps, sustainability is one of the most pressing problems, but not only as a consequence of the transport of the merchandise, but also of the packaging or the mass consumption of products. “Electronic commerce must manage from improvements in its types of packaging to more ecological mobility models,” he says, while ensuring that flexibility is essential, since the world’s needs are very changing, not only due to continued growth that is experiencing online, but also due to current situations, “which make the supply chain processes activities of utmost importance to guarantee a proper functioning of our world.”

On the other hand, he points out that the commerce is aware that, with the volumes that electronic commerce is taking, the logistics from the store has certain disadvantages and this causes a rethinking the model towards one of proximity which requires investments in platforms, where inventory management and the last mile are the two big challenges.

In fact, Martínez continues, “during the pandemic large companies have launched or announced investments in platforms. Where before the physical commerce had a network of stores to be able to sell, the online one has a logistics network to materialize the sale ”. In this sense, he points out that the role of the logistics operator is key.

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