A logistics network is a key component of the ecommerce supply chain. Tracking the movement of goods from the supplier to the customer’s doorstep is something businesses have to get right. It may not be the most exciting aspect of running an ecommerce business, but a high-performing logistics network can be a game-changer for continuous growth.
If you want to compete with Amazon or become an ecommerce success story, you have to meet customer demand for fast and affordable shipping. But not every direct-to-consumer (DTC) brand has access to a robust logistics infrastructure and technology. That’s where a third-party logistics (3PL) company like ShipBob can help.
What is a logistics network?
A logistics network consists of moving finished goods, starting from the manufacturer or supplier and moving to the end user. This includes managing ecommerce inventory, and fulfilling and shipping orders. Inventory and order management, warehousing, and fulfillment all play a key role in creating a strong logistics network.
3PL logistics networks streamline your supply chain workflow
Managing your own logistics network can be challenging, expensive, and time-consuming. If one thing goes wrong, it can break your entire supply chain and lead to unhappy customers.
That’s why many fast-growing ecommerce brands partner with a 3PL like ShipBob. We provide the fulfillment network, technology, and expertise needed to help your business grow.
Here’s an overview of how 3PLs like ShipBob can help you streamline your supply chain workflow.
1. A scalable network
If you want to create a best-in-class ecommerce logistics network, it’s going to take time and money. You need to rent warehouse space, hire and train labor, negotiate volume discounts with carriers, find local carrier partners, and so much more.
With a 3PL, everything you need to create a well-run logistics operation is already in place, so you can focus your time and energy on growing your business.
2. Advanced inventory tracking technology
3PLs goes beyond simple inventory tracking. They offer advanced features like inventory reorder points so you know when to reorder products based on historical order data. Other powerful inventory tracking features provided by 3PLs include:
- Tracking inventory by channel and fulfillment center
- Historical product demand
- Products not selling (dead stock)
- Seasonal inventory performance
As your business grows, inventory tracking becomes much more complicated — especially if inventory is in multiple locations that may be using different software. With a 3PL, everything is standardized to make inventory management an easier process.
3. Distributed warehouses and inventory management
While it may seem convenient to only have your products in one location (often close to home), the reality is that you’re going to spend more on retail fulfillment with only one warehouse location. With inventory distribution, your products are located closer to your potential customers.
For example, if your business operates out of New York, but you have a high number of orders coming in from California, you’re going to spend a lot of money on shipping across the country. With your inventory split across fulfillment centers across the US, you can optimize shipping, reduce shipping costs, and offer faster more affordable shipping for your customers.
4. 2-day shipping capabilities
Offering shipping incentives such as 2-day shipping can help reduce cart abandonment and build customer loyalty. To compete with larger brands and marketplaces, you can outsource fulfillment to a 3PL that offers a robust fulfillment network. If a customer is located in the a fulfillment location’s surrounding area, they will have the option to have an order delivered in two days.
Take advantage of ShipBob’s ever-growing global logistics network
As a tech-enabled 3PL, ShipBob operates one of the leading and most robust logistics networks for ecommerce businesses. With multiple locations in the United States, Canada, and Ireland, you can choose which locations to store inventory in to reduce shipping costs and speed up last-mile delivery.
The best part? We keep expanding into additional locations worldwide, which allows your business to scale.
If your business only sells in the US, we have a coast-to-coast network of fulfillment centers to help you save on logistics costs and improve delivery speeds. With our global fulfillment network, you can ship internationally or store a bulk of inventory in one of our international fulfillment locations to better serve customers abroad.
“Last July, Prymal reached $40,000 in revenue. After switching to ShipBob just four months later in November, we are reaching $160,000 a month in revenue — that’s 300% growth. We’re also saving $8,000 per month in fulfillment costs.”
Courtney Lee, founder of Prymal
All of our fulfillment centers are powered by our proprietary tech stack, so there are no discrepancies with inventory or order tracking, and you can track the entire fulfillment process from one dashboard.
ShipBob also offers fulfillment and shipping insights to identify how quickly orders are being fulfilled and shipped, how much inventory you need to order (and when) to meet demand, and where to store inventory geographically based on where your customers are located, and much more.
“ShipBob’s analytics tool is really cool. It helps us a lot with planning inventory reorders, seeing when SKUs are going to run out, and we can even set up email notifications so that we’re alerted when a SKU has less than a certain quantity left.”
Oded Harth, CEO & Co-Founder of MDacne
How ShipBob takes improving ecommerce logistics to the next level
ShipBob is one of the leading 3PLs for ecommerce businesses. Some of the fastest-growing brands have worked with us to not only handle fulfillment but to grow their business.
Here are just a few reasons why you should consider working with ShipBob to improve your logistics network:
1. Automated inventory management
Want to see which products need to be reordered soon? Not sure how much inventory you should order based for the holidays based on past performance? We got it covered. With ShipBob’s built-in inventory management tools, you get insights into your inventory 24/7 and not have to worry about stockouts ever again.
“ShipBob’s analytics tool has been great to have. We can see inventory reconciliations and easily view SKU velocity, transit times, and inventory distribution recommendations.”
Pablo Gabatto, Business Operations Manager at Ample Foods
2. Automated warehouse systems
At ShipBob, our fulfillment centers use our proprietary warehouse management software (WMS) to automate warehousing. Unlike on-demand warehousing platforms, with our technology, you will know what’s going on in the ShipBob warehouses where your products are stored at all times.
You can search orders by tracking number, destination country, the number of items it contains, filter by sales channel, fulfillment center location, as well as get full transparency into performance such as fulfillment speed, orders fulfilled on time, error rates, orders shipped claim-free, and much more.
“My favorite aspect of ShipBob is how easy it is. The software is pretty intuitive, and everything is where you think it would be. The ease of access and automation has helped us sell on our store.”
Josh Hollings, Founder & CEO of Drop FX
3. Advanced analytics and reporting
ShipBob is all about transparency. With our advanced data and analytics reporting tools, you can track and measure the performance of your orders and inventory with ease. With pre-built reports and a user-friendly dashboard, you can use your fulfillment data to give yourself a competitive advantage.
Get insights into which fulfillment centers you should stock, days of inventory left before you run out, impact of promotions on stock levels, each shipping method’s average cart value, shipping cost, and days in transit, your fulfillment cost per order, storage cost per unit, and much more.
“I am a bit of an analytics nerd, so I love the ShipBob dashboard because I didn’t have access to this level of visibility before. It is so cool to see how all the shipments move through the process so quickly and how fast the whole fulfillment process happens. I also love the ability to see remaining inventory — that’s so huge”
Andrea Hamilton, founder of The Finer Things 1920
You can also ShipBob’s performance to see how we’re performing against our SLAs, so you know your customers are getting their orders without delay.
4. A consistent experience
All of our fulfillment centers are powered by the same technology and follow the same SLAs and fulfillment best practices. We control what goes on inside our warehouses to ensure every merchant is given the same retail fulfillment experience no matter what ShipBob fulfillment center location(s) they store their inventory in.
“ShipBob is consistent and reliable. I know if an order is imported before noon, it will be fulfilled the same day. I don’t have to play the guessing game with ShipBob. I also appreciate that if they make a mistake, I can reach out to support and it’s not an excuse, but them owning up to it, apologizing, and taking care of it immediately.”
Torii Rowe, COO & Co-Founder of MANSSION
Your logistics network is crucial to get right. With a high-performing logistics network, orders can be delivered to customers in record time to help grow your ecommerce business. While logistics can be complicated, mastering it can be a key competitive advantage for your growing business.
“With the new fulfillment network, we had to rely on a game of telephone and someone else to do this for us. When trying to leave the fulfillment network to return back to ShipBob, the fulfillment network had 1,500 units of missing inventory that they couldn’t find.
Because of a lack of ownership of the entire fulfillment stack, it’s been difficult to rectify, unlike with ShipBob who owns the entire stack: inventory and order management system, warehouse management system, and their fulfillment centers.”
Gerard Ecker, Founder & CEO of Ocean & Co.
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Logistics network FAQs
Here are some of the common questions we’ve been asked by our customers about logistics network:
What is a logistics network?
A logistics network consists of moving finished goods, starting from the manufacturer or supplier and moving to the end user. This includes managing ecommerce inventory, and fulfilling and shipping orders. Inventory and order management, warehousing, and fulfillment all play a key role in optimizing creating a strong logistics network.
What is network design in logistics?
Network design refers to the setup of logistics operation to streamline the inventory management and fulfillment process. A well-designed logistics network consists of inventory stored in one or more warehouses closest to customers to reduce shippings and offer faster shipping, while keeping logistics costs low.
How do I optimize a logistics network?
There are several ways to optimize logistics. But many ecommerce businesses prefer to outsource logistics to a 3PL to optimize their network. For instance, ShipBob is a 3PL that offers distributed inventory, which helps businesses reduce shipping costs while offering affordable shipping to their customers by storing inventory in strategic locations.