How Small Retailers Can Compete with Retail Giants
Q: What is the biggest thing for shippers to consider in their supply chain?
A: The one constant trend is the growth in the way we reach consumers. E-commerce sales increased 15.6 percent in 2016, and there are no signs that this trend will slow in the future. Direct to consumer is here for the long run. How we manage that process to give consumers what they want is critical.
Q: How can small to mid-size e-commerce and retailers partner to compete logistically against giants such as Amazon and Walmart?
A: To compete in today’s environment, small to medium players need to offer competitive supply chain and delivery services, and they need to find those solutions in the market, since they don’t have the scale to replicate them on their own. Today’s third-party logistics (3PL) providers and leveraged platforms are offering more shared services to help these shippers. Pick a partner who has experience in a global and local environment.
The number-one thing for the small to mid-size shipper to understand is that they don’t have the critical mass to recreate what the largest entities can.
Q: Why 3PLs?
A: Today’s 3PLs are leveraging their buying power, carrier and supplier relationships and software to put together seamless packages for clients. In a perfect world, the 3PL can handle all the pieces from international shipping to the United States; U.S.-based fulfillment, and final delivery—from small package and parcel to full white-glove delivery. This gives the client a couple of essential advantages: cost and visibility in a single solution.
Q: What are some of the other advantages for shippers?
A: In a shared environment, leveraged platforms are the best at connecting shippers with the best-fit solutions. Without critical mass to generate your own dedicated environment, 3PLs can create a repeatable and reliable process for delivery. An example for white-glove delivery would be having multiple delivery networks that are capable for the particular product. Without critical mass and repetition, consistency and quality are difficult to maintain. A 3PL that has multiple relationships can have a final-mile network that works for gun safes, and another that works for furniture.
Q: What do you see as one of the biggest challenges for white-glove shippers?
A: In addition to free shipping, the biggest item that the consumer wants today is speed. Most consumers don’t understand, or care to understand, the difference between two-day small parcel and four-week furniture deliveries. The 3PLs that offer quick transit solutions for their clients will help them win more customers. That could range from a faster line haul portion to forward inventory deployment of inventory in key markets. Small to medium size e-commerce players can compete with the big guys; they need to make sure they pick the right partner to help them succeed.