Simon Wright from Parcelhub Limited knows a thing or two about logistics. At the moment various carriers are stretched to capacity and it makes sense to have multiple carrier contracts to support your business. Today Simon writes about how ecommerce is changing and what companies like Parcelhub can do to help retailers manage their business:
Shipping is the most crucial stage in ensuring your ecommerce business builds a strong reputation. It’s key to delivering class leading levels of service to your audience. To be competitive, many e-retail firms use a wholesale shipping provider, giving access to discounted parcel delivery and improved customer service through bespoke software. This post explains the relevance of ‘shipping software’, and whether your business has sufficient scale to reap the rewards on offer.
The ecommerce climate in 2014
Not only is the UK the largest ecommerce sector in the EU, it’s also one of the fastest growing. From various studies, 2014 growth has been reported at anywhere from 15% to as much as 20%.
One source has even found that ecommerce is growing ten times faster than any other channel in the UK. This phenomenal growth is down to a number of factors:
- Increased accessibility of the internet across different devices (tablets, phones)
- Increased investment by retailers in mobile friendly sites
- Improved internet speeds
- Increased adoption rate with the aged
Online retailers are also focussing on international markets, with Internet Retailing reporting that the UK ecommerce export market could treble in size to £45bn by 2020. Because of the opportunities this change presents, retailers are thirsty for innovation and are searching for more competitive rates on their parcel delivery.
The impact of this growth on ecommerce delivery
You are probably shipping products not just locally, but internationally as well, meaning you have to manage multiple contracts with different carriers, depending on where the said carrier’s core competency lies. For example, one carrier’s services may be geared towards cost effective local deliveries of small items, whereas another will be more cost effective for international shipments.
The inefficiency of managing multiple contracts yourself
The problem with managing (and setting up) multiple contracts with different carriers is that not only does this take up a lot of time (and paperwork), small business volumes are unlikely to be high enough to qualify for discounted rates with mainstream carriers, especially if you share volumes between multiple carriers.
Firms such as Parcelhub address this issue. With a multitude of carrier partners, added in with the fact that they ship more than 250,000 parcels a month on behalf of more than 500 growing businesses, multiple carrier shipping providers give growing businesses access to ‘pooled volume discounts’ – Effectively this is a buying group for parcel delivery.
Having the power to access multiple carrier services, print labels and track orders from a single dashboard gives growing businesses a competitive advantage, whether the business is generating sales through eBay, Amazon, various eCommerce platforms (such as Magento, Linnworks, ChannelAdvisor) or a combination of these.
Integration with your ecommerce platform
Multi-carrier Shipping Software can be installed on your PC, server or accessed via the internet, enabling you to import your sales data from your eCommerce platform on a regular basis.
Once imported, the software processes your customers’ personal information (shipping address, phone number, email address, carriage option) and automatically chooses the most suitable service from a range of carriers. From this point you can print labels out for your parcels, and Parcelhub will collect your items to send from your business premises.
The cost savings on offer
Expect cost savings of 20% and more; much cheaper than typical ad-hoc shipping providers, however bear in mind that this figure varies widely depending on which locations your business services, volumes and insurance agreements. To be cost effective for the shipping provider and for you, a general requirement is that you are currently sending 10 or more parcels per day. Due to the cost savings on offer through pooled volume networks such as these, this business model is favoured by large scale retailers.
Aside from the impressive growth in demand for bulk shipping solutions, many emerging online retailers are demanding a comprehensive eCommerce fulfilment solution. Parcelhub’s sister company Mail Workshop provides picking and packing services, storage, catalogue distribution and bulk mailing. Fulfilment outsourcing saves the online business time, allowing them to focus more on marketing their brand, suppliers and engaging website visitors.