5 Keys to be able to handle the logistics of electronic commerce

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By: Gustavo Zapata Talledo, Business Unit Manager

Although the beginnings of electronic commerce in Peru date back to the nineties with experiences such as Rosatel or the extinct Mallperu, to give some examples; Online sales have started to gain momentum only in recent years. Thus, according to estimates of the Foreign Trade Company (Comex Peru) these transactions would reach US $ 2,500 million in 2018, which would represent a 47% growth from 2013 to the present year.

The Chamber of Commerce of Lima is a little more optimistic and estimates revenues of US $ 3,000 million for this year, explained by purchases made by six million people. From the government, the Minister of Production, Raúl Pérez-Reyes, estimates that electronic commerce already represents 7% of total sales in Peru, when practically its participation was close to zero three years ago.

And is that, according to estimates of Cash Payment, about 1,000 companies are added annually to electronic commerce in the country. Of these, many players come from physical retail and another important part are pure ventures. In that sense, this online wave no longer only includes the big brands, but also medium and small businesses that have decided to venture into this market.

With figures as of September 2018, Kantar Wolrdpanel found that 38% of Peruvian families have searched or bought an item online in recent years. Considering the online purchases made in the so-called Cyber ​​Days, the company Linio points out that the Peruvian consumer demands mainly cell phones (smartphones, portable batteries, smartwatch and headphones), computer products (hard drives and laptops), as well as consoles, videogames and fashion (shoes and watches).

On the other hand, for Visanet, some additional factors that have contributed to this phenomenon have been the hiring of taxis, as well as the contracting of music services or videos, through mobile applications using credit or debit cards.


Key strategies

This is how the expansion of online sales is one of the two phenomena that are changing the national logistics market (the other is the aggressive expansion of convenience stores). Well, we move to small volumes, to a large number of deliveries and much faster, which means that logistics operators must transform their practices in the areas of warehouse and distribution.

Similarly, there are many retail companies with online presence that have a large number of products (references or SKUs, Stock-Keeping Unit, for its acronym in English) and have a large number of likely destinations for delivery.

For all this, to manage an efficient logistics it is important to take into account 5 keys:

1.- Migrate the storage infrastructure of bay racks or complete pallets to have increasingly smaller warehouse locations, such as half pallets, planks or bines because all customers are migrating to omnichannel: to sell in the retail channel to wholesalers and in a virtual store.

2.- Transform the typical thought of supply by lot for a fractionation of order to a continuous process by event, where the order arrives to the system, it is immediately worked by the personnel.

3.- Having a competitive cost in the transfer, for this it is important to plan more efficiently the capacity of the transport units by means of adequate calculations of the volumetric of the SKUs and orders.

4.- Achieve a sequencing and programming of the routes to have a delivery in a time window, because now the customers are not willing to wait 8 hours, but an hour or maximum 2 hours of rank to be able to receive the order; GPS location being key and implementing a router.

5.- Visibility and information in real time. Clients need information and status of their loads at all times, for this only it is only important to have websites and apps, but that the information shown is 100% reliable.

Thus, this effervescence of electronic commerce must have an adequate logistic strategy if it is not that the bad experiences of the clients do not wreck the online adventure to which the various Peruvian companies are venturing. And the logistics operators are a perfect ally for the experience, scale, infrastructure and technologies they handle.

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