The supply chain is an integral part of any business’s strength and growth. The importance of the supply chain was always acknowledged by businesses across the globe. However, during the pandemic covid-19, the importance of supply chain management increased further. The world has seen a lot of delays, port congestion, container shortages that led to shortages or delays of certain products. Companies around the world are now focusing on supply chain management to increase the availability of their product. 

The trend e-commerce business is flourishing during the pandemic covid-19. The growth in the e-commerce business is further opened new challenges in inventory management. The growth of e-commerce business ideas is further enhancing the requirement of proper inventory management through supply chain management.

Managing the logistics of any company is an important factor in not only making available the product but also contributing to higher customer satisfaction levels. Proper logistics planning can also help a company in reducing the cost of the supply chain. In today’s blog, we will discuss in detail logistics planning, and how it can help a company in its growth. Logistic planning has become an integral part of supply chain management.

LOGISTICS PLANNING:

It is a system of logistics through which the business can improve its management. It can overcome supply chain disruption and delays, in a cost-effective and time-efficient method. The basic purpose of logistic planning is to get the product delivered to the end consumer, at the least cost and fastest time.

Logistic planning revolves around the three basics of supply chain management procurement, production, and logistics. The logistics planning is different for a different type of business, depending upon their nature of business. Each different type of business requires a separate set of logistics planning, for better inventory management and supply chain management. Logistics planning also involves the warehousing of the product, fulfillment of the orders to the customer, sales returns from the customer.

Importance of logistics planning for e-commerce:

Logistics planning plays a vital role in e-commerce businesses. Proper logistics planning assures the growth and sustainability of the e-commerce business. Few importance of logistics planning for an e-commerce business is as follows

Reduce supply chain cost:

The foremost important benefit of logistics planning for an e-commerce business is the fact that it reduces the supply chain cost of the business. Proper logistics planning will lead to smooth working in the supply chain process, which will result in reducing any disruption or delays in the supply chain process. With the smooth flow of the supply chain process, the business will not have to pay higher for speedy deliveries. Reduction in cost will also help in higher sales of the product. A low sale rate will also help in better competition with the competitors of the product. Proper logistics planning can also involve hiring the services of 3pl third-party logistics. It can also help in reducing the cost of the supply chain process.

Increase revenue:

The second important aspect of logistics planning is the fact that it helps in increasing the revenue of the e-commerce business. the proper logistics planning will help the business in the effective and efficient delivery of products to the customer. Logistic planning help in two ways of increasing the revenue of e-commerce businesses. Firstly, it reduces the cost of the supply chain process and secondly, it increases the revenue of the company by increasing the sales of the product, due to the fact of fastly deliveries to the consumer.

Increase sales of an e-commerce business:

The third important aspect of logistics planning is the fact it helps the e-commerce business in increasing the sales of their product. Logistics planning increases the customer satisfaction level by fastly and streamlined deliveries to the customer. The result of a satisfied customer is increased sales volume of the e-commerce business.

How to improve the growth of the E-commerce business by improving logistics planning?

Logistics planning is very supportive in the growth and achieving the stability of e-commerce businesses. The e-commerce entrepreneur can always apply special tips in logistics planning to increase their e-commerce business.

Demand forecasting of the products:

The ability of any company to properly demand forecast has the potential of properly doing the inventory management of their product. Thus demand forecasting will help in improving the logistics planning for any e-commerce business. If a company is unable to do the forecasting of their product, that will result in poor management of stock management. Proper demand forecast e will always help the company in establishing the fact how much stock, is required at which warehouse.

Demand forecasting will also help the e-commerce businesses in increasing the customer satisfaction level of the customer. It is true through the fact that the demand forecasting will enable the e-commerce business to place their stock properly at the warehouse location where customer demand is expected to remain high. The company on basis of the demand forecast can also manage the logistics planning according to season and festivals.

Hiring Multiple logistics carrier

Logistics planning can be done more effectively through the fact that a company has multiple options for the logistics carries of the products. A successful e-commerce business should always engage in multiple carriers so that if one carrier is unable to provide them the services they require, they might hire the service of another carrier. Multiple carriers might also help them in better rates.

Apart from multiple carrier options, the e-commerce business should also engage in multiple carrier types such as air, sea, land. By engaging in all types of carriers the e-commerce business will be in better execution of their logistics planning.

Use of modern technology:

A successful e-commerce business will always engage modern technology and software in its supply chain process. The use of modern technology and software will help e-commerce businesses in proper logistics planning of their products. Modern technology and software will also help e-commerce businesses in gathering the data for demand forecasting and planning. These all aspects in return will help e-commerce in proper logistics planning.

Multiple warehousing facilities:

The use of multiple warehousing will help in managing a distributed inventory of the e-commerce business, the distributed inventory will have a dual effect, firstly it will reduce the logistics cost for delivering the product to the customer, and secondly help in timely delivery of the product to the customer. Thus multiple warehousing will always help the business in better logistics planning for the e-commerce businesses.

CONCLUSION:

E-commerce is a futuristic way of doing business. In order to succeed in the e-commerce business, the entrepreneur needs to do proper logistics planning. Proper logistic planning involves multiple stages such as procurement of the raw material. And shipping of the product to the customer and managing the sales return from the customer. Logistics planning will always help the business in cost-effectively delivering the product to the customer, in the least lead time for the delivery of the product. The success of an e-commerce business will always be dependent on successful logistics planning. So we can say that supply chain management is highly dependent on the logistics planning of the e-commerce business to excel successfully.