Stage is where you outline how you’re going to manage the various elements in order to ensure the right products are in the right place at the right time. As well as meeting customer demand, you’ll want to design a plan that helps you maximize revenue.
Your plan should be based on a set of measurable metrics and benchmarks for success, which in turn should be based on your business goals and your resources. For example, is it feasible to offer next-day delivery? Is there a contingency plan for events like power outages? Which software system will you use?
Supply chain, the next stage is when you source raw materials and/or suppliers. You might need to source components for creating products, or just the finished goods. Either way, it pays to select reliable partners and build strong relationships with them.
It makes sense to use local suppliers where possible to reduce transportation costs. As well as working with several different suppliers in case one of them has a problem but not so many that it’s hard to keep track. You’ll need to negotiate prices, payment terms, and shipping logistics.
Depending on your business model, the goods may be delivered from the supplier to your own warehouse for processing and onward distribution, to a retail store for sale, or direct to customers.
This is sometimes called the logistics stage, where you and your partners (suppliers, shipping carriers, 3PL providers) work together with your in-house teams to get the goods out on time. Here, a robust order fulfillment system encompassing picking, packing, and transportation can transform your business’ supply chain.
The most obvious reason is that the goods were damaged or faulty, but e-commerce customers may return items that arrived too late, or because they ordered multiple options.
Returns may arrive by mail or to a physical store, even if they were bought online. You need a robust system for processing them—ensuring that customers are reimbursed quickly, undamaged products go back into your inventory, and non-resalable items are disposed of or recycled. Your customer service team should also be ready to deal with customer queries and complaints.