Logistics challenges for eCommerce giants

Customers are becoming more demanding, competition is increasing and the international trade situation is changing. The logistics challenges for the eCommerce giants in the near future are significant, and to address them successfully, decisions have to start being made.

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Although the ability to improvise is an asset among managers, anything that can be planned, foreseen and organised in advance is always more likely to work out better. Being prepared for eventualities and adaptability does not mean making improvised decisions, but being able to foresee in advance what may happen and what will be the best possible decisions in those potential emergency situations. VALL sells and rents demountable logistics warehouses for large international e-commerce companies.

And what are the biggest challenges?

Peak demand from online retail giants starts as early as November and in some cases extends almost until February. The increase in purchases is brutal and many include shipping to different destinations, a practice typical of customers who buy Christmas gifts online. Being able to deliver on time for deliveries on Black Friday, Cyber Monday, Christmas, January sales, Singles' Day or Valentine's Day is one of the logistics challenges for eCommerce giants.  Did you know that in the last five years, around this time of peak sales, the world's largest e-commerce companies have hired 11% more employees? These are distributed in different sections such as transport or warehouse work.  In many cases, during the weeks of peak demand, storage space requirements increase. And it is necessary to have storage buildings and industrial warehouses at strategic points for distribution or delivery that can be dismantled after these dates. 

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Another major logistics challenge for eCommerce giants has to do with congestion in cities. Not only in the world's big cities. Increasingly also in medium-sized cities.  Access to them is already difficult, especially at peak times. Delivery driver congestion is increasing as online shopping for home delivery grows. And the configuration of cities with more one-way streets and more pedestrian areas complicates the work of the delivery driver. In order to be able to deliver parcels on time, logistics centres need to be closer and closer to the cities. In some cases, late deliveries are penalised financially or involve a return, which in turn needs to be managed and stored in a suitable space.  In addition to all this, there has been an increase in the number of urgent or fast delivery purchases. In this type of delivery, it takes only a few hours from purchase to delivery. And both the distribution and delivery warehouses must be located and organised in such a way that this work can be dealt with in the required time. When Amazon first started selling, it was a bookstore selling books. Today it is a giant marketplace with a catalogue of products that includes all kinds of goods and merchandise. From food and wine to motor vehicles, from cleaning products to digital devices, from cosmetics to clothing.  Some of the goods sold by eCommerce giants have specific storage requirements for optimal preservation. There are foods, potentially dangerous products or products that can be damaged at certain temperatures. They must be stored in spaces with the right conditions of impermeability and temperature.  This is a challenge for logistics warehousing, as it means that both its permanent warehouses and its temporary storage and distribution halls must meet certain conditions. The demands are high. And dealing with it quickly and successfully is essential.

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In the last two years and a bit, the world, which has always been in a state of continuous transformation, has been changing at breakneck speed. And for large eCommerce companies, this has meant a brutal logistical challenge.  The reactivation of international trade after the pandemic made it necessary to make changes after having already adapted to the shortage of some supplies or goods. The increase in the price of energy resources in Europe and much of the world, together with the increase in areas at risk of conflict, made it necessary to adopt more efficient routes and adapt the map of warehouses to the new reality. The risk of shortages of some products due to energy problems means that there is an increased need to keep large stocks of products in stock. In some countries where e-commerce is widely established, such as Germany or Great Britain, the authorities have already warned of possible power cuts at some point in the coming months.  And that may mean that large eCommerce companies will require support to distribute to these countries from neighbouring countries by reinforcing their presence there. And these are just the main logistics challenges for eCommerce giants. Preparing to address them successfully is something that can't wait. That's why the help of companies like VALL that can provide secure and operational logistics warehouses in a short time is so important. Sources: https://www.diarioelcanal.com/los-7-retos-de-la-logistica-del-e-commerce/ https://blog.seur.com/retos-oportunidades-logistica-ecommerce/ https://www.thenewnow.es/negocio/retos-transporte-y-logistica-comercio-online-protagonistas/ https://www.mascontainer.com/los-nuevos-retos-para-la-logistica-del-e-commerce-evolucion-y-consecuencias/