Seasonal peaks are no longer a problem with logistics solution by Fulfillment by FHB Group.

7 Biggest Challenges for E-Commerce Logistics and Fulfillment Centers

One of the most important experiences for a customer with an e-shop is the time from placing the order to its delivery. Speed and flawlessness are therefore primary factors in maintaining customer loyalty in the future and preventing them from switching to competitors.

The e-shop must therefore focus not only on its own presentation, but also on ensuring the most thorough logistics services for products and making the purchase as pleasant as possible for customers. However, there are many more challenges for e-commerce logistics than just ensuring fast delivery and flawless packaging.

In addition, both consumer behavior and customer expectations for added value in e-commerce stores are constantly evolving, with new ones emerging. To be successful and competitive, an e-commerce business must regularly monitor these changes and adapt accordingly.

The online space is full of competition, which is multiplied by the increasing internationalization of the e-commerce environment in recent years. We will delve further into the most prominent challenges for e-commerce logistics in the following points in the article.

1. Delivery Delays

Swift delivery of parcels has become a necessity nowadays. Many customers decide whether to make repeat purchases from an e-commerce seller based on delivery speed.

Currently, the logistics standard is to ensure delivery within 24 to 48 hours from the time of order placement. This poses a significant challenge for e-shops, as meeting this deadline requires the use of costly technologies and an adequate workforce.

Established players in the market with fast delivery services do not face this problem since they can afford to invest in their own logistics. Another option is for e-commerce businesses to outsource part or all of their logistics to third parties. They will solve these problems for them, and situations such as seasonal peaks are no longer a problem.

2. International Delivery

The online space offers numerous opportunities, making it disadvantageous for an e-commerce store to focus only on one market. The e-commerce environment is becoming increasingly international, and not expanding can mean missed opportunities for a company.

The challenge for an e-shop is not only to localize its website for broader and foreign audiences but also to ensure that deliveries to other countries are fast and, most importantly, flawless. However, this presents a significant challenge for small and medium-sized enterprises, as they lack the necessary know-how, advantageous agreements with couriers, and other essential resources.

One solution is, therefore, to use a fulfillment company that has experience in delivering around the world. Such a company can provide international logistics under more favorable conditions and in a shorter time.

3. Localization

The challenge of having properly localized warehouses is closely related to the previous point. To promptly process shipments and achieve 24-hour delivery, it is crucial to have appropriately localized warehouses in multiple countries.

For instance, if an e-shop aims to sell across Europe, an ideal solution would be to have a warehouse centrally located in Europe. Economically efficient delivery within 24 hours, such as from Bulgaria to Spain or Portugal, would otherwise be very challenging.

When outsourcing logistics, e-shops must carefully consider where they plan to sell their products and choose a partner with advantageous warehouse locations accordingly.

4. Transparency and Security of Shipment

Real-time tracking of shipments is a growing trend among customers. They want to know the current location of their package and the progress of their order.

Furthermore, an e-commerce business must ensure the security of the package to prevent any damage to the product. Therefore, great attention should be given to handling packages during the packaging process and transportation.

Damaged or lost goods disappoint customers, and such unnecessary errors influence their future purchasing decisions. Ensuring the most transparent delivery process is a challenge for e-shops, and the selection of couriers and their last-mile capabilities should not be underestimated.

5. Lack of Branding Opportunities

The delivered package is the customer’s first physical interaction with an e-commerce store’s services. The initial impression from the package presentation is, therefore, crucial for online store branding.

There are many opportunities for an e-commerce business to promote itself or enhance the customer experience through product packaging. However, many e-shops do not take advantage of this possibility due to the potential costs and time involved.

The result is evident, as several e-commerce stores immediately seize opportunities to improve the consumer experience, giving them a slight competitive advantage. This creates a challenge for other e-shops to catch up with other businesses.

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6. Customer Support

In many cases, customers need assistance with their orders, and this is where customer support comes into play. Customer support can address issues related to order inaccuracies or various problems that may arise.

Efficient customer support enhances the consumer experience and aids the customer’s decision-making process for future purchases. Conversely, poor or absent customer support, particularly for expanding e-commerce stores, can lead to unpleasant experiences.

In this case, the challenge for e-shops is to provide at least a Q&A section in multiple languages or respond to emails within one business day. In more advanced cases, telephone customer support may be necessary, but serving multiple foreign countries requires additional staffing arrangements.

7. Complicated Product Returns

Another significant challenge for online stores is ensuring that the return process is understandable and straightforward for customers. According to Invesp, up to 92 percent of customers would make a repeat purchase if the return process were easy.

Approximately one-third of products purchased online are returned by consumers, whether due to a change of mind or unsatisfactory items. It is the e-shop’s task to simplify this process as much as possible or provide conditions to reduce the percentage of returned products.

Potential solutions include incorporating various online testing methods on the website or improving product presentations. However, it is impossible to entirely avoid returns, so return management should proceed as smoothly as possible.

If an e-shop lacks the means to handle return management, one option could be to delegate this responsibility to third-party logistics providers.

Facing Challenges at Fulfillment by FHB Group

We also acknowledge the challenges faced by e-commerce businesses in Fulfillment by FHB Group. Our fulfillment services aim to provide e-shops with the best possible logistics conditions for their operations and customers.

These services include fast and flawless order processing, international delivery within 24 to 48 hours, additional branding options, customer service, and complete management of returned products. We continuously work on improving and modernizing our services, enabling us to offer solutions for the latest trends to our clients.

We regularly invest in process automation and digitalization to provide customers with the best possible consumer experience, ensuring that they have visibility into the status of their orders from the moment they are placed. With years of experience, modern facilities, and expanded warehouses in the heart of Europe, we offer an ideal combination for flawless and fast delivery worldwide.

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