6 points e-commerce firms should consider while selecting their logistics partner

Choosing the right logistics partner is amongst the most important decisions an e-commerce platform will ever make.
6 points e-commerce firms should consider while selecting their logistics partner

Running an e-commerce platform is no easy task. Competition is intense and often cut-throat, and the smallest of complications can rapidly propel a business down a slippery slope. Although this is true the world over, it’s especially apparent in the online Indian marketplace that’s crowded with global behemoths such as Amazon and local unicorns like Flipkart.

In the face of this competition, an e-commerce firm that hopes to survive and thrive must constantly remain in top form. Every aspect of its business must run like clockwork. And while many companies do attain this level of precision, where most stumble is the final stretch, the delivery of an ordered item to the customer.

That’s where a logistics partner comes in. Under their purview is everything that happens from the moment an order is placed to the moment it is delivered safely into the hands of the consumer. In technical terms, the post-purchase experience.

While this may initially seem a simple enough task, give it a little thought and you’ll rapidly realise the scale of the job. A logistics partner is directly responsible for transportation, warehousing, security, and last-mile logistics, to name just a few of their responsibilities.

As such, choosing the right logistics partner is amongst the most important decisions an e-commerce platform will ever make. To help smoothen the process, here are a few things to look for when making the choice:

1. Serviceability

A large and growing e-commerce business is likely to have customers from all across India. In order to ensure their deliveries are fulfilled in an efficient and timely manner, it’s vital that the logistics partner you choose have a network that’s just as widespread. It’s especially important to ensure that their core delivery areas overlap with your primary target markets.

For example, if the majority of your orders come from metros, it makes sense to choose a partner that has a strong distribution presence in major cities. Similarly, a platform whose customer base is rural-centric should opt for a logistics service that has a widespread network across the country, with a proven record of efficient operations in smaller cities and towns. 

2. Performance Rate and Efficiency

While there’s no arguing with the need for a logistics provider, it’s important to remember that a poor performing partner can do your business more harm than not having a partner at all. That’s why the performance rate of a logistics business, i.e. the rate at which they’re able to deliver their assigned orders, is one of the most important metrics to take into consideration when making a choice.

The efficiency and speed of logistics service is another key factor, especially in a time when speed delivery has become the norm when shopping online. To satisfy this need for instant gratification, go for a partner with the capability to offer same-day, one-day, and 48-hour delivery options, your customers will thank you for it.

3. Customer Service

A customer is unlikely to differentiate between an e-commerce platform and their logistics partner when tracking their order or speaking to a delivery person. To them, the two are one and the same. A logistics partner is, for all intents and purposes, an extension of your business. As such, it’s vital to ensure that they make the best impression possible.

Choose a partner with a reputation for excellence, and that’s known for its quick responsiveness, fluid communication, and effective solutions to any issues that might arise, at both the business and consumer end. Good customer service is a force multiplier and can help your platform make a name for itself in an overcrowded field with a great post-purchase experience.

4. Technology

Every year brings new advancements in technology and innovation, and this holds true in the field of logistics as well. The integration of the latest technological advancements helps optimise the functioning of the business, enables the company to reduce operating costs, and boosts the efficiency of the delivery process.

While choosing a logistics partner that recognises the importance of staying up-to-date with the latest digital breakthroughs is important, platforms should also examine their ability to integrate their systems with third-party services such as logistics intelligence solutions providers. Through these tie-ups, e-commerce platforms can further streamline their operational flow, proactively communicate with customers through order status notifications, and offer an even smoother experience to the end customer.

5. Pricing

Logistics companies offer a vital service, and it’s only fair that they charge accordingly. While it may be tempting to opt for the lowest price in an attempt to cut costs, that may not always be the best option. A lower price can often be an indicator of overstretched staff, cut corners, and poor service offerings – none of which justify the savings that come with this option. As in so many other cases, you ultimately get what you pay for.

Another key consideration is to ensure that the logistics company provides a full accounting of the services it offers and the costs each incurs. By insisting on transparency, you can safeguard yourself from any hidden charges and avoid a price when you receive your bill. The costing list should always include transportation, receiving, warehousing, pick-and-pack, shipping, account set-up, and monthly minimums. If all of these factors are accounted for upfront, you can be sure that you’re in good hands.

6. Reputation

The field of logistics is vast and complex, and only a select few logistics partners are qualified to handle every aspect of the sector. Some might have a regional specialisation, while others offer a countrywide presence. Certain businesses might have dedicated themselves to the fashion and apparel industry, while others might be better equipped to deliver produce. Whatever the case may be, it is imperative that a platform do their due diligence and select a logistics partner that has the experience and infrastructure that best complements their business.

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