International Logistics and Supply Chain Management

International Logistics and Supply Chain Management
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Table of Contents TOC \o "1-3" \h \z \u 1.0 Introduction PAGEREF _Toc507671867 \h 32.0 Information Flow PAGEREF _Toc507671868 \h 33.0 Material flow PAGEREF _Toc507671869 \h 44.0 Management of Warehouses PAGEREF _Toc507671870 \h 65.0 Unqualified Management of Physical Goods PAGEREF _Toc507671871 \h 86.0 Recommendations PAGEREF _Toc507671872 \h 96.1 Flow of Information PAGEREF _Toc507671873 \h 127.0 Conclusion PAGEREF _Toc507671874 \h 12Bibliography PAGEREF _Toc507671875 \h 14
International Logistics and Supply Chain Management
1.0 Introduction
Numerous challenges have been reported concerning Black Friday and Cyber Monday online shopping, with customers having to wait for many hours before orders are delivered and sometimes being told that the inventory has been depleted or they receive expired stock. Furthermore, shoppers are often exposed to stampedes when doing physical shopping, especially when they want to get the great offers at low prices that are offered during Black Friday (Goldman, 2016). In e-commerce, evidence suggests that the fabulous and low prices are some of the areas that are often exposed to numerous challenges, including the competitiveness of each transaction. This paper critically analyzes the logistical challenges associated with Black Friday online shopping. Some of the problems that will be analyzed include management of warehouses, untimely logistic information, unqualified management of physical goods, product quality, product damage, and irregular online information.
2.0 Information Flow
To meet the expectations of consumers during Black Friday (BF) and Cyber Monday (CM), online and physical operations should be made flexible, integrated, and seamless to enhance the efficiency of its operations. Studies have revealed that the modern day consumers demand higher visibility of the logistic operations, faster delivery times, notification and tracking of shipments, and better customization of product variety (Lopez, 2017). Nevertheless, evidence has revealed that customers are exposed to numerous problems, especially when it comes to online shopping, since e-commerce logistics are yet to be effectively managed. It is evident that the whole shopping season, which includes BF and CM, shines a spotlight on the complexities and challenges associated with e-commerce. Therefore, supply chain experts should be prepared and concentrate on improving the consumer experience by ensuring that the supply chain is optimized with standardized automation and processes.
The chief sales and marketing officer at DX Paul Doble says that retailers during the Christmas shopping season should be able to focus on accurate estimation of the volumes that will be needed during this period. Retailers should have the capacity of working with their logistics partners to ensure that there is accurate estimation. However, the greatest challenge that online shoppers face includes poor communication, inaccurate planning, and demand outstrips capacity, weather conditions that are unanticipated, and other problems that cause businesses to be unable to fulfill the promises they make to online customers (Procurious, 2014). He adds that several problems are commonly exacerbated after businesses attempt to maximize their e-commerce shopping platform. This also happens when retailers push back their BF deadline orders and thus radically raising the risks of having their deliveries delayed (singpost.com, 2014). This also takes place during bad weather conditions as well as different factors that may lead to supply chain disruptions.
3.0 Material Flow
Retailers should be able to ask themselves how prepared are their delivery strategies during BF to avoid the risks of negative publicity and disgruntled online shoppers. This is because shoppers bear the brunt when deliveries are delayed because of poor logistics and efficient delivery plans. Statistics released by Visa revealed that close to £360,000 was spent every minute during BF, with additional £281 million being spent through online shopping in one of the busiest days (Procurious, 2014). BF is also recognized as America’s traditional shopping bonanza with more than $2.48 billion being spent through online shopping. E-commerce is also predicted to increase by 15% to 2.6 billion. Nevertheless, the challenges that consumers face are associated with untimely delivery as well as the sale of expired and damaged products that do not meet customer expectations. Delivery times tend to slow down from 2 days to more than one week. The omni-channel has increasingly been exposed to many complexities and this has caused supply chains to become more complex, but this provides retailers with an opportunity of implementing a well-prepared operations. Logistical challenges are some of the greatest problems that most retailers face when it comes to fulfilling online demands from shoppers during BF and CM. According to Schimidt (2017), BF is considered as the most profitable shopping period in the year across the world. Incredible discounts and special deals that are offered by retailers provide shoppers with an opportunity of buying goods in bulk. However, evidence shows that during this period, online shoppers increasingly complain about substandard goods that do not fulfill their quality specifications.
Some of the distributed products are usually of poor quality, damaged, or they are not delivered on time. Statistics indicate that in 2016, Germany alone generated sales of €1.1 billion (Schimidt, 2017). This has been made possible by the increase in the number of customers who want to make online purchases. According to business analysts, the increase in e-commerce has drastically changed the way cities operate, yet logistical challenge has hampered the efficient provision of services from retailers. The challenges are also associated with the dynamic rise in freight transport and traffic, particularly because of a sharp increase in online sales. Although retailers increase the number of their staff to make deliveries, studies have revealed that increased demand leads to delays as well and sale of poor quality products. There are numerous factors that make efficient delivery more challenging (Lucas, 2015). For instance, when a product is delivered after an online purchase, the owner may not be around, thus forcing the retailer to make a second and even third trip. This implies that the entire traffic volume will drastically increase. Furthermore, another challenge is that numerous cities have not been designed to handle such kind of traffic and there is a scarce and limited parking space. This places the delivery team under intense time pressure since they are forced to park on bicycle paths and pavements, thus causing new forms of traffic obstruction. Studies have also shown that it is extremely challenging to establish interplay between representatives of the public sector who act for the citizen interests and providers of logistic services whose focus is on the transportation of goods (Rouquet, 2017). Furthermore, it is difficult to integrate the services of the retail sector who aims at ensuring that their products are delivered at the right time and the right place.
4.0 Management of Warehouses
Black Friday and Cyber Monday are shopping periods in which retailers witness a surge in sales and demands, which requires retailers to increase the volume of their stocks. For this to be possible, the volume of stock that is stored in warehouses increases significantly and this implies that the logistics of managing this area tends to be placed under massive pressures and challenges. Studies have also revealed that most retailers are unable to provide adequate warehousing services as well as efficient management of these places. According to George-Parkin (2017), UPS hired 95,000 extra employees during BF while Amazon employed 120,000, but still consumers continued to experience delays lasting up to one week. Shopping on different online platforms should be a seamless and smooth experience, but customers continue to experience delays because of many factors. Poor management of warehouses plays an instrumental role in delays as well as delivery of damaged goods. It is also important to note that even when online stores appear to offer slick services, there is a gargantuan logistic system required to power all the associated functions of warehouses. They include a network of supply chain managers, postal employees, robots, and top executives who sometimes become finite and fallible (Donaldson, 2017). Studies have also shown that most shoppers during BF as well as CM have realized there are numerous warehouse delays and shipping challenges that cause orders to be delayed for several days.
For instance, a customer for Shopbop said that there were many complaints from customers who attacked the social media pages of the brand for lack of feedback from customer service employees. The customer argued that certain orders have been upheld since Thanksgiving and they were still under “processing” (Jancsa, Takas & Cseresnyes, 2017) The Twitter customer service for H&H started to direct its clients to the online platform of the company since the phones had been swamped with unending calls. This is a clear indication of the challenges that retailers go through when the warehouse department fails to offer efficient services. Studies have also shown that both online and in-store shoppers during BF and CM are usually faced with a variety of challenges because of the influx of orders that are yet to be processed. This is directly related to warehouse services that are unable to meet the growing demand that originate from online shoppers. During this period, delivery times end up being extended to ensure that retailers are able to meet the growing demand (Seth & Amer, 2016, p.3). Although the normal delivery times are usually 3 to 5 days for standard orders, BF delivery time end up being extended to more than one week. Evidence indicates that even businesses such as Shopbop, which is owned by Amazon, whose services are hinged on free and fast shipping, has experienced numerous hiccups and challenges in terms of dealing with an increase in online transactions (Nahata, 2017).
Data provided by Hitwise indicates that the retailer was associated with close to 50% online transactions for BF as well as Thanksgiving, but most clients argue that their 2-day Prime deliveries did not meet their target, with some deliveries passing the one-week mark (George-Parkin, 2017). A Twitter survey has also revealed that numerous other brands have also been exposed to warehouse delays as well as a backlog of complaints at the customer service. Such companies include Sephora, ASOS, Fashion Nova, Yoox, and Ssense. When products are released from the warehouse, they are usually exposed to a myriad of challenges, from transportation, traffic, breakages, and untimely delivery. According to articles published in the Wall Street Journal, UPS said that the ...