Millions of Canadians shop online because it makes their lives easier, but most are unaware of what goes on behind the scenes of an e-commerce website. What might strike them as an easy and painless process – just a click – is actually pretty intricate.
A lot of coordination and moving parts are involved in processing an order and delivering it to a customer’s door. If you’re an e-commerce merchant, you know all too well that your backend operations team is constantly working hard to fulfill promises, and that every stage of the workflow is critical.
The key to keeping customers happy is pretty straightforward: the better your backend operations, the better the customer experience. But establishing and maintaining a high standard in that regard is easier said than done. Many e-commerce merchants are inundated with urgent day-to-day demands that distract them from the task of optimizing their operations in the first place, but it’s critical to make time for strategic improvement.
Understanding the shopper path to purchase
If you intend to optimize your e-commerce operations, it’s important to familiarize yourself with the shopper path to purchase.
The customer journey typically involves: brand discovery, browsing, ordering, receiving – and potentially returning. Your business’ backend operations greatly impact this journey for the customer. To motivate customers to click the buy button, especially more than once, near-flawless execution in your e-commerce operations is critical. After all, the entire end-to-end process – from receiving an order to processing a return – is about delivering on your promises.
Make and keep your delivery promises
A delivery promise can be the start of a beautiful relationship. It’s a powerful driver for customer acquisition and retention and should be clearly communicated to potential customers before they even arrive at checkout. Before placing their order, a shopper should know (and usually wants to know) when and how they will receive their package. Your delivery promises, and your ability to follow through on them, will depend on the effectiveness of your e-commerce operations.
Optimize your e-commerce operations workflow
Instituting an optimized workflow is the key to keeping your delivery promises. The time that you’ll invest in establishing and maintaining an efficient process for your business is time well spent, so don’t delay. Here are the most critical processes to optimize in your e-commerce operations:
Receiving and managing orders
Whether you’re selling directly from your own website, in-store, on an online marketplace or via third parties, optimizing order-processing is the first step in satisfying your customers.
Receiving an order starts the clock on fulfilling your delivery promises. Your business’ ability to manage and quickly process its orders will shape brand perception for your company. Ensuring consistently efficient order processing is a great way to establish a competitive advantage for your business.
Many e-commerce platforms offer basic inventory management to help you manage and process your orders. As your business grows, you may need to invest in additional technology to sync inventory across multiple channels. The more this process can be automated for your business, the better.
Managing orders begins with sorting them. You’ll need to prioritize your efforts at the pick-and-pack stage. Some standard sorting options include:
- First-in-first-out (FIFO): Ship orders placed the previous evening until your cut-off time. Ideal for processing a handful of orders.
- Speed: Prioritize next-day-delivery orders, and possibly those that have to travel further (for example Vancouver to Atlantic Canada).
- Customer-service focused: Prioritize exchanges or replacements. Or delight your most loyal customers.
- Product deliverability: Ship when all items in an order are in stock.
Where and how you fulfill your company’s orders is key, and you have a lot of options in this regard. Make sure your fulfillment space is suitable for optimal operations – both in the present and the not-too-distant future. If your current space isn’t cutting it, you’ll need to find a new space to fit the bill:
- Upgrading your space – If you’ve outgrown your initial fulfillment setup, you’ll need to move to a bigger space. Before you move, consider your forecasted growth. You don’t want to outgrow the new space too fast, or lease more space than you need.
- Outsourcing – Some retailers engage third-party logistics (3PL) to manage their e-commerce fulfillment. While managing your own warehouse operations gives you control of your distribution processes, using an established 3PL provider allows you to focus more closely on other areas of your business.
- Picking and packing – Effective pick-and-pack processes are all about managing cost, minimizing errors and meeting customer expectations. Picking and packing takes time and is a crucial component of fulfillment to handle quickly – especially considering 45% of shoppers expect their orders to be fulfilled within a day. To optimize this aspect of order fulfillment, it’s critical to determine which picking method is right for you:
- Basic – for a single order
- Batch – software-driven for several orders
- Zone – tech-enabled for a larger warehouse
How well you pick and pack depends on how you access your inventory, how you optimize your packaging for your product mix, and how you organize the right tools and spaces to process your orders.
Choosing the right packaging can also be a challenge. You need to optimize the number of boxes in use, protect items in transit and minimize extra space which can increase shipping costs.
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In order to fulfill your orders like a pro, and meet or exceed your customers’ expectations, you’ll really need to fine-tune your workflow.
It’s all in the details
It’s critical to think strategically about how to receive your incoming inventory, where to store it, the location of packing stations and how to separate outgoing orders. Here are some useful tips:
Keep your hottest items on hand
Place your fastest-moving products in an area that’s easy to access and quick to replenish. This will ensure that those items fly out the door without hesitation when an order comes in.
Be ready to go go go
Stock your packing station with supplies and tools and ensure they are easily within reach for your packers. Assemble shipping boxes in advance. This will help your packers move fast and avoid making mistakes.
Streamline your supplies
If you sell a variety of products, you may have three or four box sizes. If your product range is limited, one or two may suffice. Using the smallest number of packing options that makes sense for your business will save you money on supplies and take some of the guesswork out of packing, saving you time on order fulfillment.
How you ship matters
Offering efficient and convenient shipping is your last opportunity to ensure an exceptional delivery experience for your customers.
At this stage, it’s all about printing labels and managing logistics.
There are free online shipping tools that can help you that are generally available through your shipping or e-commerce partner. These tools can help you print labels quickly and effectively.
As you grow and contend with increased volumes of orders, it’s important to consolidate your cross-channel orders and batch-print labels. At this stage, you may benefit from using more sophisticated shipping solutions.
Many merchants start out using an office printer to generate labels. Thermal printers are best for large batches. You will also need a scale to weigh parcels and measuring tape. Many merchants, who ship only a few parcels per week, bring their orders to the post office themselves. Once your business generates enough volume, a pickup service will save you a lot of time getting your parcels out the door.
Make these changes now
The efficiency of your e-commerce operations workflow is critical to the success of your business. How you communicate with website visitors, and how you process, fulfill and ship orders to your customers, will heavily influence their perception of your business and whether or not they’ll shop with you. Don’t neglect the backend operations of your business. Now is the time to optimize them.
Canada Post. 2018 Canadian Online Shopper Study. CPC 18-200, April 2018.
Canada Post. 2016 Canadian Online Shopper Study, CPC 16-202, April 2016.
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