The Role of Fulfillment Services in E-commerce

Fulfillment Services and how It relates to E-commerce.

Well, lets start with the Basics.  So what exactly Is E-commerce?

E-commerce is the transacting or facilitating of business on the Internet that often involves fulfillment services. E-commerce is short for "electronic commerce." Popular examples of e-commerce revolve around buying and selling online. But the e-commerce universe contains other types of activities as well. Any form of business transaction conducted electronically is commerce.  One Example of E-commerce is Online Shopping.  Buying and selling goods on the Internet is one of the most popular examples of e-commerce. Sellers create storefronts that are the online equivalents of retail outlets. Buyers browse and purchase products with mouse clicks. Though Amazon.com is not the pioneer of online shopping, it is arguably the most famous online shopping destination.  Another example of e-commerce is Electronic Payments.  For example, when you are buying goods online, there needs to be a mechanism to pay online too. That is where payment processors and payment gateways come into the picture.  Electronic payments reduce the inefficiency associated with writing and mailing checks. It also does away with many of the safety issues that arise due to payment made in currency notes.  Online Auctions are another form of e-commerce.  Most likely, when you think online auction, you think eBay. Physical auctions predate online auctions, but the Internet made auctions accessible to a large number of buyers and sellers. Online auctions are an efficient mechanism for price discovery. Many buyers find the auction shopping mechanism much interesting than regular storefront shopping. Internet Banking is also considered e-commerce.  Today it is possible for you to perform the entire gamut of banking operations without visiting a physical bank branch. Interfacing of websites with bank accounts, and by extension credit cards, was the biggest driver of e-commerce.  Lastly, Online Ticketing is another very popular form of e-commerce.  Air tickets, movie tickets, train tickets, play tickets, tickets to sporting events, and just about any kind of tickets can be booked online. Online ticketing does away with the need to queue up at ticket counters.

Types of E-commerce fulfillment services deal with

E-commerce fulfillment services can be classified based on the type of participants in the transaction.  For example Business to Business e-commerce transactions are those where both the transacting parties are businesses, like manufacturers, traders, or retailers.  Business to Consumer e-commerce is when businesses sell electronically to end-consumers.  Lastly, fulfillment services deal with Consumer to Consumer

e-commerc.  Some of the earliest transactions in the global economic system involved barter -- a type of consumer to consumer transaction. However, these transactions were virtually non-existent in recent times until the advent of e-commerce. Auction sites are a good example of consumer to consumer e-commerce.

TAKE ADVANTAGE OF THE BENEFITS OF E-COMMERCE BY USING A FULFILLMENT SERVICES

The primary benefits of ecommerce revolve around the fact that it eliminates limitations of time and geographical distance. In the process, ecommerce usually streamlines operations and lowers costs.  This is furthered by using third party logistics such as fulfillment services.Specialized Forms of E-commerce may effect the need for fulfillment services

On some platforms, ecommerce has shown the promise of explosive growth. Two such examples are M-commerce and F-commerce.  M-commerce is short for "mobile commerce." The rapid penetration of mobile devices with Internet access has opened new avenues of e-commerce for retailers.  F-commerce is short for "Facebook commerce." The immense popularity of Facebook provides a captive audience to transact business.

Issues for e-commerce and fulfillment services alike

Many e-commerce businesses have to deal with their customers receiving the wrong item, not receiving anything at all or in the worst case for fulfillment services, a damaged item.  When left unresolved, they issues can sound the death knell for any business, e-commerce or otherwise.  But therein lies the existential dilemma for e-commerce. To begin with, people expect better prices, if not "deals" in online purchases. That shaves the margins of many e-commerce businesses to single-digits. So how would they be able to afford outstanding and personalized customer service?

Where Fulfillment services aid E-commerce

Akin to physical retail, ecommerce too works on maximizing visitors to their store. But unlike physical retail, an ecommerce merchant cannot simply hand over the merchandise to the customer over the counter. The goods need to be packed and shipped, often across state and national boundaries. As if that was not enough, issues dealing with returned goods, or reverse logistics in general can be especially irritating for ecommerce businesses, as they do not have a physical location where goods can be returned.
There are two important trends that will help you better understand issues pertaining to ecommerce fulfillment.  First, the trend of third Party Logistics fulfillment services.  Online businesses are fueled by efficiency. As ever-improving technology and devices work better, even business processes need to improve. This necessitates specialization as a way of life -- which presents a compelling rationale to outsource e-commerce logistics.  Third party logistics fulfillment services providers are now available across boundaries. They can not just deliver with a high degree of accuracy, but also manage costs to the point where in-house logistics becomes illogical.  Yet another driver for outsourcing logistics is the fact that most e-commerce businesses do not have the scale where they can afford the huge costs of cutting edge software required to remain competitive. And as computing goes increasingly mobile, the investment in latest technology is only bound to increase. This makes a compelling case for large format, multi-location, specialist third party logistics fulfillment serivces providers.

The effects of Reverse fulfillment services Logistics on e-commerce

Many ecommerce businesses would prefer to wish away the need for reverse logistics. As if the strain of creating and fulfilling demand was not enough, ecommerce professionals have to find means to deal with goods that move in the reverse direction -- from the customer to the business. There are many drivers of reverse logistics and fulfillment service, such as returned, undelivered, and damaged goods. But not all reverse logistics is driven by error or accident. For instance, in the case of exchange-offers, e-commerce businesses actual fuel the need for reverse logistics. However, the business model of a reverse logistics unit is quite different from that of the logistics and fulfillment services unit.

How Effective Ecommerce Fulfillment services will operate

For fulfillment services to be effective, an ecommerce business must pay attention to several aspects of the business such as speed, accuracy, scalability and surge.  Speed means that the goods must not just get there, but they must get there in time, every time.  Accuracy means that the goods must get there, but not just any goods. The exact goods that were ordered must get there.  Scalability, means that you can get the goods there now, but that as you grow  your fulfillment services can grow with you? Surge has to do with the holiday season and the other occasions that cause surges in shopper traffic and your dependency on fulfillment services. You have probably ensured that your website withstands the surge, but does your fulfillment services do the same? Or will the Christmas gift be delivered after Christmas? Just another way in which e-commerce and fulfillment services are directly linked

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