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Packaging in Ecommerce

Ordered a couple of items yesterday from 2 different sites: Myntra.com and Zovi.com.

Both companies took the exact same amount of time for delivery: a day and a half. Overall the experience with both of them was pretty good. Except that when I got the ordered items, I was a lot happier with the Myntra.com experience. Why? Mostly because their packaging was a lot better than Zovi.com’s.

This is what I got from Myntra.com. As a package it was colourful, and was promising of good quality items inside. It made you want to open it.

Zovi.com’s looked like they had sent me a bunch of documents. This is what it looked like. I’m not sure why, but I felt disappointed the minute I got this small brown paper packet which supposedly had my t-shirt inside.

 

So the point here is not to bicker about something that seems a relatively small issue. But its’ about the fact that a company cares enough that they want every aspect of the customer interaction to meet a particular quality, right down to the packaging.

And packaging is actually the first real interaction that the customer has with the product that they have just bought. It’ll be good for the Indian ecommerce companies to learn a lesson or two from the focus that world leading brands like Apple have put into this.

Yes, packaging costs are important to keep under control, but lets see some good innovation in this area. Looking forward for more exciting deliveries.:)

 

 

Murali Balan is the CEO of Tenovia Solutions, an Ecommerce product and services company. When he’s not discussing Ecommerce stuff with a retailer, he loves to go for long runs. 

Distribution Systems Evolving in Ecommerce

The landscape of Supply Chain in E-tailing is drastically changing for the better. Here is a look at some of the improvements taking place at the leading online retailers in India.

Large distribution centers: Improves order fulfilment with higher inventory levels that are directly under your control compared to a 3rd party.

Improved technologies: Deeper integrations with supplier inventory reduces the chances of received orders not getting fulfilled because of stock unavailability.

Better tools and systems: Better scanners, conveyer belts, automated packaging systems, automated labelling systems have decreased the time taken at multiple points of procuring and packaging.

Smarter Analytics: Predictive analysis is being used increasingly to anticipate customer order patterns and stock accordingly.

Production Panning: Increasingly, Ecommerce companies, who are more aggregators than manufacturers, are planning their sales and promotions and going directly to the manufacturers with a set of orders and an delivery schedule based on demand. This backward integration has not only cut out the middlemen, but also given better controls to the Ecommerce companies.

Infrastructure-as-a-Service: The TATAs own a company called Drive India, which basically provides large scale infrastructure to any company that requires it. I believe this IaaS model will grow in the Ecommerce industry.

Better talent: As the Indian Ecommerce market matures and customer orders increase and the investments pour in, better talent is getting attracted to the sector. And with the influx of better talent, the supply chain built around the Ecommerce trade is constantly improving in quality.

Sustainable Packaging in Ecommerce

Was at Coonoor (a gorgeous-sleepy hill station town in the Nilgiris) over the weekend, and was amazed at how the entire town, and increasingly the entire region, is saying no to plastic.

They have the same retail chains who dole out plastic bags across India, providing cloth / paper bags at the checkout counters. Incredible. Amazing what a little firm initiative from the local government can do.

Makes me wonder when the same focus is going to come into the world of Ecommerce. Today some of the leading online retailers are still dumping the customer with excessive non-sustainable packaging. Its time all of us in the industry looked into this and did something about it.

I’m starting today by trying to find vendors who supply sustainable packaging materials so that I can recommend them to our clients.

I’m convinced that it will make a difference for the customers as well to know that the company that they shop with is green. It should be a differentiator and for those e-retailers complying with it should be making some noise about it.

Ecommerce Logistics – The essentials

Picking a courier company / logistics partner is probably one of the most critical decisions for an Ecommerce company. They are the last mile of your interaction with the customer, and as a result you need to be really careful about that experience. So please consider the following points as you select one or more logistics partners for your ecommerce business.

1. Pin Codes covered - The more the merrier.  You would be surprised the remote corners your customers can come from.

2. Delivery times for Tier 1, Tier 2, Tier 3 and Tier 4 cities / regions - Most of your customers are going to be from Tier 1 and Tier 2 cities. So ensure that your logistics provider commits to delivering your products in these cities in super quick time. Ideally next day. Worst case within 48 hours.

3. Own Network vs 3rd Party Network - Ask your logistics provider about details of the network they cover. How much of the pincodes that they cover is by their own fleet, and how much is outsourced to a local 3rd party provider. The difference in quality would be stark between the two, as will be the accountability.

4. Dedicated Relationship Manager – Demand for one. You need someone senior to service your account. Depends on the size of your business, but still demand it and get it.

5. Rates - The all important one. Shop around and consider all the factors on this list, and not just this one. Yes it needs to make sense for your business. But you don’t want to pinch pennies here at the cost of your customer’s experience.

6. Technology support – Check out how much information they can provide you and your customers with their technologies. Courier tracking and on demand status are the minimal service they should provide. They should also provide your customer support team to find the status of a bunch of Airway Bill Numbers.

7. Reconcilliation – This one is crucial to your accountant. Make sure they offer you on-demand reports of how many packages were picked up, how many delivered, send you the proof of delivery receipts, as well as all cash collections for Cash-on-Delivery orders. Also settle with your logistics company once every fortnight. In my experience, the longer the period of settlements the more the number of issues that crop up.

8. Damage and Return policy - Read this part of any contract you sign very carefully. Who is liable in case of damages to the products? What is the maximum amount of liability taken by the logistics partner? What is the insurance coverage provided? Please factor in these points when you publish your return and refunds policy.

9. Weight vs Rate – When you are considering a logistic partner, please check how their rates goes up with respect to the weights of the shipment. Does the increase seem justified? Or do they plan to make a killing when the shipment weight goes up? When you formulate your own shipping policies please factor in these costs.

10. Cash on Delivery – Extremely important in India. COD is still the preferred method of payment for many online customers. So please pick a logistics partner that provides you this service. Also do the homework in checking out the reputation of your partner when it comes to settlement of the COD amounts. This is really crucial as they become your collection agents and any delays on the logistic partners’ part in settling payments would then impact your cash flows. But still this is extremely important. And cannot be ignored.