7 Supply Chain Challenges

for E-Commerce Retailers in

India
 Published on June 26, 2015
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Vipul Mathur, CPIM

FollowVipul Mathur, CPIM
Supply Chain Professional

Though the list is not exhaustive, but here are 7 challenges that Indian
E-Commerce retailers may face while they establish the business in
India. Some of the taxation issues are still evolving and may need
edits later on.

Challenge 1: Complicated Indian Tax Regulations

Strange to know that in few states the current tax regime do not allow
material to be sold to an individual, when it is being directly shipped
to him/ her from another state, without the completion of tedious
VAT formalities. Though currently, while most e-commerce
shipments are being treated as an exception by VAT authorities as the
product is being bought for individual consumption, the legality of an
inter-state transactions is still a big question for Retailers. On top of
that, there are other taxes like Octroi and Entry Tax applicable in
many states and municipal limits levied on the shipments bought from
outside, which is then collected later from the customer at the time of
deliver – and this doesn’t go easy with some customers. Maybe a
seamless GST could be a long-awaited answer to all the worries, but
how effective would that be remain a doubt that industrialists have
started contemplating.

Challenge 2: Road Distribution Network

Due to complicated state tax regulations and the inability of last-mile

delivery companies to provide solutions that fit the Indian legal
framework, companies are resorting towards using costly air services
for interstate movement, which means higher cost of shipping for
companies who are unable to pass on to their customers. A robust and
pan-India road network is critical to the evolution of the e-commerce
companies as they expand their product base and their customer base
to the deepest parts of the country. The road infrastructure and
warehouse capabilities still need bigger investments from organized
players to make it lucrative for retailers.

Challenge 3: Inventory Deployment

Customers are pampered by Retailers and thus their expectations from

Retailers have increased manifold. With around 30,000 Pin Codes in
India that retailers can serve the customers with thousands of SKUs,
managing the stock inventory is a huge problem. Keeping high
service levels and managing multiple inventories mean higher safety
stock as well.

Challenge 4: Reverse Logistics

Statistics says for all the shipments delivered successfully around

10% of shipments are returned back due to various reasons – product
defect, customer dissatisfaction or simply a change of mind within the
‘free return’ period. E-commerce companies have started to take this
challenge very seriously. For the return proper packaging is a prime
concern, as the original box may no longer exists or may not be transit
worthy. Also there is issue of authenticity of the product and its actual
physical condition. A robust reverse logistics network is just as key to
the success of e-commerce as a forward distribution network is.

Challenge 5: Skilled Manpower

With exponential growth in B2C businesses across the country, there

is a serious shortage of skilled supply chain talent. B2C or e-
commerce requires a very unique supply chain setup and the
corresponding skill gap is widening fast. Also in the nascent stage of
this industry, no one is able to quite comprehend what skills are
actually required!! With the shortage of skilled manpower and high
attrition rate, it hampers the stability of operations and scale ramp-up.

Challenge 6: Visibility of Supply Chain

Creating infrastructure for enhancing visibility and tracking of the

shipments has become paramount agenda for retailers. Thousands of
SKUs are being shipped across several destinations by skilled and
unskilled agents. It is imperative for retailers to ensure that their
shipments reach customer in good condition and in time, and well
within customers’ patience limit !!

Challenge 7: Cash On Delivery

Despite of having up to 70% of all sales happening through this COD,

the legality of the entire transaction remains again under a cloud. As
per RBI rules, a collection agent / logistics service provider can
collect cash from a customer, however the exact monetary
instruments collected (same ‘note’) must be handed over directly to
the e-commerce company. This means this money cannot be
deposited in the service provider’s own account before being
transferred to the company. Further, there is an issue of change of title
as well, leading to a VAT liability. The solution to both these cases is
to collect on behalf of the e-commerce company and deposit directly
in their bank, but leading to huge hassles of reconciliation across
various delivery locations and a risk of banking errors, fraud and a
huge wastage of human effort.
In my previous blog, I highlighted the factors which helped e-commerce retailing develop in India. Today
consumers are powered with loads of choices for selection of the product they are looking for. They are actually
able to compare the products, look for availability of the product, get detailed information about the product,
check prices at various online websites selling the specific product and also look for attractive offers. Consumers
get their choice of goods as well get satisfied with the price they pay. Now from e-retailers perspective, above are
the must have in order to be competitive and increase sales. But for e-retailers to survive they also need to
maintain healthy profitability month on month by creating awareness among customers to visit their website and
convert visits into sales. There are some of the major challenges which e-retailers face in India to be competitive
in their business.

Margins -
All e-retailers want to maintain good margin on all categories of products. But due to intense competition and
getting higher sales, they tend to decrease their margins and offer the products at discounted rates to customers.
Basically they sell the products at Market Operating Price (MOP) or slightly higher. MOP is the least price set by
brands at which dealer or retailer can sell the product. In a way this provides customer more savings in their
basket. But from e-retailers point of view it gets challenging to continuously offer products at low prices though on
the other hand they are able to keep sales ticking with these prices.
E-retailers always negotiate hard with distributors so that they can garner higher margin. But if they continue
selling at MOP they would lesser their leverage of profitability and will have to depend on the funding to scale
their business.
Availability of Products -
Online customers are target oriented shoppers. If they don't find what they are looking for they would immediately
switch to another website. E-retailers tie up with different distributors to make sure they can get stock of products
when they require. There is high value items for which the demand is unpredictable. It would be highly unlikely e-
retailers would order high value items in bulk from supplier and stock at their warehouse. In such cases they keep
only limited stock of high value items or in some cases no stock and tie up with distributors/ vendors to have
stock, so that if high value item orders are placed it can be fulfilled on time. The challenge arises when the
regular distributors or supplier does not have the stock, and it has to be arranged from other distributors.
There must be forecasting done for each of the products. Based on this e-retailers can have at least minimum
stock maintained at distributors to avoid stock out situation.
Logistics and supply constraint for e-retailers -
There are orders from metro cities and also from far off places. Increase in supply of products and lack of
logistics in far off places can be a challenge for e-retailers. Few e-retailers have their own logistics network for
intra-city and rely on third party services for inter-city. Others depend totally upon Third Party Service Providers
(TPSP). Having warehouse at all places is also not cost effective solution. TPSP mostly use surface network to
deliver the goods as this is the choice provided by e-retailers to keep their distribution cost low. Utilizing air
network for delivery would be more costly.

The challenge for e-retailer is to provide timely delivery at far off places. Each TPSP have their own strength
based on their delivery network and serviceable locations. Some pin codes can only be serviced by few TPSP. It
would make sense for the e-retailer to tie up with 3 or 4 service provider based on his serviceable location pin
code. E-retailers can carry out a one to one mapping for pin-code and service providers, which would be unique.
Hence when the customer places the orders, based on his address pin-code automatically a delivery request will
be directed to the concerned TPSP. Customer could eventually track their orders in third party service provider's
website by providing the Way Bill number or Order number.

The above are my views. Please fill free to write about other challenges from your experience or views which the
online retailers are facing.

Supply chain in an e-commerce business is more complex than it seems. It is a major

controlling factor when it comes to bottom line of the business. Supply chain of e-
commerce consists of 3 major components:

1. Movement of goods
2. Movement of money
3. Movement of information
Any e-commerce business can be of 3 types viz. Inventory model

market place model

hybrid model.

So we will try to understand the supply chain model considering the 3 components
and 1 business model.

You can learn about these models from other resources in detail. But market place
model is used majorly. So in market place model, movement of goods is from retailer
to customer. So in this model, the e-com company does not hold any inventory and
the order is fulfilled directly by the retailer. So challenge in this model is to assure
quality of goods and timely delivery as the lead time completely depends on the
retailer.

The relation between order cycle and challenges is as follows:

1. Order is placed online by customer: the challenge here is to convey the right
and detail information to the retailer. Here, a strong IT network must be
setup between retailers and ecomm company. Many retailers fail to comply
 with the required IT infra. So the challenge here is to establish a fool proof
communication system.
2. The retailer packs the goods and keeps it ready to be picked up: challenge
here, is to assure that the right product is packed and packed properly. The
delivery fleet of the ecomm company that goes to pick up the order has to
check all these things. Its a challenge again as most of the times, ecomm
companies have third party logistic service provider. So you can clearly
imagin the challenge.
3. Goods reach to the customers: This part of the supply chain is mostly
outsourced by any e-comm company. The major challenge here is to
monitor costs incurred as in-transit loss of goods is a major factor in this
stage.
4. Reverse logistics: pain! If the customer wants to return or exhange the
items, there is no bigger pain than this in ecomm industry. It really takes
smartly designed or outsourced reverse logistics system at place.
5. Money: the main part! In the case of online payment, the money is
transferred to ecomm company first ( here the ecom company loses certain
percentage as convenience charges from payment gateway). Then the ecom
company transfers it to the retailer. Now if the goods are returned, the its a
challenge to take the money back from the retailer. Thus, many ecomm
companies dont pay retailers untill the exchange or return period is over.
This creates even bigger challenge as every transaction made or delayed is
again a cost to the company.
So overall, supply chain management in ecomm is really a challenging task. Afterall,
supply chain is the only major cost head and the only major function in any ecom
business.

5 Challenges For Supply Chain and E-

Commerce Growth
Thanks to the World Wide Web, the way we shop, pay and how long we’re willing to
wait for delivery have changed in every imaginable way. Blame it on Amazon and it’s
ability to get customers every conceivable product possible within two days, or
sometimes, even in the same day. As a result of the rise of e-commerce,
unprecedented demands are now placed on asset management systems. Companies
that refuse to adapt end up with weak links in their supply chain and find themselves
unable to meet the challenges of e-commerce growth.

So, as warehouses continue to grow and become more complex, what should
businesses be thinking about as they enter 2017? Consider starting with these five
factors—or risk being cut from global competition:

Automation, automation, automation

This isn’t the first time you’ve heard about automation, so why do we keep talking
about it? Because a proper automated inventory tracking software will balance your
inventory ratio, costs of goods sold divided by average inventory, in real-time. Think
about how big and complex distribution centers are today. Think about how fast
consumers want their purchases. Now think about how much money you’re losing if
your business’ ratio is too low, meaning you’re spending too much on inventory and
not selling fast enough, or if ratio is too high, meaning you have insufficient
inventory. Having an automated system makes it easier to switch and ramp up or
slow down and strategize, when needed.
Related Article: Barcodes and Asset Management Along the Global Supply
Chain
An important part of automation is the usage of barcode scanners which can significantly
streamline processes, turn sluggish sales around and achieve productivity and profitability.
In fact, a VDC Report found that the “the average annual growth in the 2D imaging sector is
likely to be in the region of 17 to 22 percent.” Using an effective barcode scanning system in
your warehouse can expedite processing and correspond accurate data in real-time—
everything from price, available inventory and sometimes even photos or instructions—so
you now know everything that’s moving in your warehouse for an error-free process.

Mobility is the new normal

According to eMarketer, there was an estimated 1.75 billion smartphone users in
2015, which is about 25 percent of the total population. By 2017, that number is
expected to reach closer to 40 percent of the total population. When we think about
the impact of smartphones, then it’s easy to ask: why wouldn’t mobile play a role in
supply chain management? That’s what Wal-Mart asked itself when losing $3
billion in 2013 after years of inadequate supply chains leading to excess goods
surging past sales. Something needed to change, so earlier this year, the retail giant
launched My Productivity app, which allows managers to access real-time data from
their smartphones. This means that without leaving the sales floor, managers are
able to restock items and access sales.
There was an estimated 1.75 billion smartphone
users in 2015.
CLICK TO TWEET
If businesses are going to understand customers, they need to get the way they
think and behave. Today’s consumers are browsing and making purchases anytime,
anywhere, and they’re increasingly doing it on mobile devices every year. So why
wouldn’t business also be conducted this way? (Read this article for more on
barcode scanners for iPhone and Android)

Continuity of customer experience

The future of commerce is all about creating a connected customer experience.
From laptops to tablets to smartphones, customers want the same seamless,
personalized experience—without interruptions—when they go from one device to
another. For instance, if you start watching a Netflix movie on your laptop, but later
want to finish the movie on your tablet, you’d want to be able to pick up right where
you left off. Supply chains should also be built and managed with continuity in mind.
Whether a customer is shopping on their laptop or mobile device, their customer
experience with your business should remain the same. This means wherever they
are in the world, whatever business location they’re shopping from, it shouldn’t be a
problem. This is a harder than it sounds for larger businesses with multiple
warehouses across the country or globe. If you have separate inventories, you need
a proper asset management system to coordinate experience and communication.

Robotics are coming for your goods

According to market research and consulting firm IDC, 40 percent of manufacturers
will be investing in robotics and autonomous guided vehicles (AGVs) in their
warehouses by 2018. That’s a big percentage, and it makes a lot of sense. Think of
how much success Amazon has experienced since their $775 million purchase of
Kiva robots in 2012. Amazon started using these advanced robots, now simply called
Amazon robots, in July 2014 and as of January 2016, the retail giant reportedly
had 30,000 robots in its warehouses. At 16-inches tall, these robots zoom swiftly
through large, complex warehouses without bumping into one another, pick up
shelves a few inches from the floor and bring the goods to employees.
But like the innovative company Amazon is, it’s not done with robots just because it
has them working in its warehouses. For years, Amazon has brought up the idea of
using drones to deliver products to consumers. This may sound like an idea years
away from reality, but the truth is, flying drones are closer than we think. And when
it comes to inventory management, drones will do a lot for supply chains. For
instance, DroneScan is a company that connects yesterday’s barcode scanning
technology with new drone technology. With DroneScone’s technology, drones can
fly freely around warehouses scanning barcodes applied to shelves and products in
order to update inventory systems and send alerts when goods are running low or
have remained on shelves past its lifespan.

Proper warehouse layout for improving supply chain

If we have all this technology, then why do we need to think about something that
sounds as archaic as warehouse layout? Because systems matter, and the more
complex and competitive the world gets, the more companies need to utilize
warehouse spaces as effectively as possible. For instance, think about IKEA’s rows of
meticulously stacked boxes. Putting items in specific rows and columns was not an
accident. That was a strategic supply chain decision that resulted in a kind of
efficiency that’s never been seen before IKEA came along. The company separates
its products into high-flow and low-flow facilities to drive down costs-per-touch, an
asset management tactic that says the more hands that touch a product, the higher
that product’s costs. The result? IKEA was given a brand value of $11.8 billion in
2015 by Forbes’ list of the world’s most valuable brands(Read more about IKEA’s
inventory system here).
Here’s what else IDC predicts for manufacturing supply chains in the near future:
 By the end of 2016, the majority of all manufacturers will be actively employing
commerce networks in their supply chains to facilitate either demand, supply, or the
development of new products.
  By the end of 2018, 25% of manufacturers will have implemented a micro-logistics
strategy within part or all of their business to support a more distributed inventory
management strategy.
 By 2018, 75% of manufacturers will coordinate enterprise-wide planning activities
under the umbrella of rapid integrated business planning.
 By 2019, 50% of manufacturers will have modernized their logistics network to
leverage 3D printing, robotics, and cognitive computing to support innovative
postponement strategies.
 By the end of 2019, enterprise-wide improvements in resiliency and visibility will
have rendered short-term forecasting moot for 50% of all consumer products
manufacturers and 25% of all others.
 By the end of 2016, one-third of all manufacturers will be actively integrating their
“traditional” supply chain processes with product and network design,
manufacturing, and service.
 By the end of 2017, the need for visibility, scalability, and flexibility across the value
chain will drive 60% of manufacturers to invest in cloud-based WMS and TMS
solutions aligned to their trade partner networks.
 By 2018, 40% of manufacturers will be investing in robotics, autonomous guided
vehicles (AGVs) and associated systems within their warehousing operations to drive
automation into their fulfillment processes.
 By 2018, proliferation of advanced, purpose-built, analytic applications aligned to
the Internet of Things (IoT) will result in 15% productivity improvements for
manufacturing supply chains.
 By 2020, 50% of the operational jobs in the supply chain will have evolved into
“knowledge” roles required to support new technologies like cognitive computing
and modern robotics

What started as a straightforward ecommerce site

or maybe just an experiment in taking your retail
store online … has grown. Not just a little. A lot.

It’s every founder’s dream.

Unfortunately, high-volume growth can be a

logistical nightmare. You now face the
challenges of managing products across channels,
aligning inventory and delivery, coordinating
with suppliers and manufacturers, as well as
connecting in-store purchases and pickups with
online orders and even international demands.
 Every success presents unique obstacles, and all
of them cry out to be solved.

It’s time to figure out those solutions.

What is Omni-Channel Logistics?

Accenture’s Retail Consumer Research recently
discovered not only how interconnected and
seamless consumers now want their shopping
experience to be but also how the majority of click-
and-mortar retailers are falling short:

 58% of global retailers have smartphone apps with

purchase capabilities
 Only 28% of retailers provide store-specific stock
availability online
 And less than half of retailers — 46% —
enable store staff to order out of stock items for
customers
In addition, customers expect a product to arrive
as soon as possible and also want the freedom
to try it out or try it on either in store or at home.

Serving this always-connected consumer may look

like the following:

1. A potential customer sees an advertisement for

jeans on their smartphone traveling home from
work.
2. At home, they use their desktop to Google your
brand.
3. Once on site, they decide to buy a pair but select
in-store pick up to try them on first.
4. As soon as the buyer arrives in store, a clerk picks
up the jeans and sets up a dressing room with a
few shirts to match.
5. The customer likes the jeans and two of the shirts.
6. Unfortunately, their shirt sizes are out of stock.
7. However, instead of losing the additional sale, the
clerk places an order online for the right sized
shirts to be delivered to the customer's home.
8. The shirts arrive within a day, and the buyer is
delighted.

That process is now becoming standard and

allows you to tailor how a product is experienced,
purchased, and delivered. By optimizing the
locations, sourcing, and fulfillment of your products
…

Omni-channel logistics ensure reduced costs,

faster delivery, and a better customer experience.

When we discuss omni-channel logistics at my

company Sourcify, we ensure we have the
following bases covered:
 An online purchase sent directly to a consumer
(inventory visibility).
 An online order sent for in-store pick up (channel
specific process).
 Cross channel fulfillment options (speed of
delivery).
 Reverse each scenario whenever a product is
returned (ease of return).
When your customer moves across channels, a
traditional multi-channel approach to logistics can
come up short in regards to the information
availability, delivery speed, and personalized
experience that modern shoppers expect.

Moreover, optimizing each channel individually

breeds competition between them.

For example, products fulfilled by FBA often move

faster than your own warehouse or 3PL. This can
create variations in your customer experience,
product information, pricing, and service levels.

For an ecommerce brand, omni-channel logistics

will help you improve efficiency, cut shipping times
and costs, and enable you to manage your
inventory across channels and fulfillment centers.
This all adds up to a seamless experience across
consumer touch points to simultaneously create
both a diverse product flow as well as a
consistently positive purchase.

To do this, four challenges present themselves …

Challenge 1: Inventory Visibility

Knowing the status of your inventory is at the core
of a strong omni-channel approach.

In a traditional model, you will dedicate inventory

by channel and have little to no cross-channel
inventory visibility.

The last thing you want is to promise next-day

delivery to your customers and not be able to
follow through. This is a challenge for a retailer
that sells across channels, especially during peak
holiday seasons.

To address this challenge, develop an efficient

order fulfillment process that works via an
optimized warehouse management system. By
using inventory visibility as a forecaster of future
demand, you can plan your supply chain activities
accordingly.

Once you scale out your inventory visibility, you

may get to the point where you can sell orders
online without ever taking physical possession of
your product.
Your ecommerce and order management systems
will be synced up in a way where an order through
your Shopify store will trigger your closest omni-
channel distribution center, and fulfillment will be
carried out by your outsourced or in-house party
responsible for that channel.

By setting up a measure for inventory visibility,

your store will be more capable of having a
smooth customer experience while staying on top
of its supply chain.

Challenge 2: Channel-Specific Processes

The next flaw businesses fall victim to is focusing
on channels independently. Your supply chain
needs to be integrated across your own Shopify
store, retailers, and other online sales channels
like Amazon.

Though in some cases you will have to adhere to

distribution guidelines set by FBA, you can still
implement a system that integrates these
channels.

This will ensure you make the most of your

channel specific warehouses and have a dynamic
outlook towards space allocation.

Implementing an omni-channel process will also

enable you to use spaces variably. Warehouses
can act as showrooms. Ikea, for example, uses
this model for a highly cost-efficient supply chain.

Challenge 3: Speed of Delivery

One of the hardest parts in selling across channels
is ensuring speedy delivery. When a customer
buys online, they expect that order to come within
a few days … at most.

In addition to creating clear expectations for each

channel, utilizing physical stores as fulfillment
centers is a must. In fact, given the rising desire
among customers, stores should serve as both
pickup locations for online orders — buy online,
pick up in-store — and fulfillment locations for
deliveries (ship-from-store).

Allowing customers to buy online and pick up in

store saves both the customer and the company
money. Also, when a customer is picking up an
order, they often make additional purchases.

As a creative example, Walmart recently

announced plans to let its employees fulfill local
orders by paying employees extra to deliver online
orders headed to destinations along their normal
route home.
That said, most retail stores are not set up to fulfill
orders and most lack good inventory visibility.
Their backroom space is limited, and store
employees are trained to sell, not fulfill orders.

Challenge 4: Ease of Return

Handling the return of orders should be a crucial
consideration when setting up your omni-channel
logistics system. If you truly want to be integrated
across platforms, you should aim to enable returns
from different platforms as well.

If a customer purchases one of your products

online, can they return it to a retail location?
Customers need to feel like they have the ease of
returning their purchases or your conversion rates
will suffer.

The implementation of a sound reverse logistics

system will be imperative to good customer service
within your omni-channel strategy.

Though these challenges are big, your return on

investment will greatly outweigh these initial
problems.

Omni-Channel Logistics in Action

When Ryan and Andrew Beltran launched Original
Grain on Kickstarter in early 2013, they had their
goals set high. In their first crowdfunding
campaign, they raised nearly $400,000 and
realized firsthand that their logistics and supply
chain would be the backbone of their company.
Flash forward four years, Original Grain has hit the
eight-figure sales mark while selling across various
channels like brick-and-mortar retail, Amazon, and
their own Shopify Plus store.

They took an omni-channel logistics and supply

chain approach early on and, as a result, have
earned five-star reviews across channels.

Their Amazon store provides free same-day

shipping through FBA. On Shopify Plus, they detail
their shipping process on a designated shipping
page. These two channels are intertwined on their
backend to easily keep track of inventory levels.

When shipping from their Shopify store, they work

with a third party logistics partner who batches
shipments within a one or two day period. This
enables them to optimize the actual fulfillment
process by shipping similar products at the same
time.

A Bird’s Eye View of Omni-Channel Logistics

The key to implementing an omni-channel logistics
strategy in your company is to focus on the
customer journey.

Amazing interactions at every touch point will

ensure a smooth process and — in today’s review
based ecommerce space — maintaining a
stellar reputation can’t be underestimated.

Your approach should align with your shoppers.

Implementing an omni-channel logistics and

supply chain system may seem complex, yet by
mapping it out around your customer journeys,
you’ll be able to create a seamless process.

Today costumers seems to be tired of crowded marts, long

checkout line, infuriating road traffic and all the interrelated
shopping hassles. Have you ever wondered how better a
shopping idea could be if only these hassles are eliminated with
some clicks ! In today’s world customer prefers to switch to the
best option with least effort therefore the best option for such
customers is online shopping.

As we all are aware that it’s the end of year and thus the
shopping season would soon be at its full bloom, So attention
online retailers a great opportunity is again at your door step to
attract more costumers this season with some easy n handy
tactics. Here on this blog I would be sharing some of the useful
tips that would make your costumer go for your site every time
he feels the need to shop.
SUPPLY AND LOGISTIC CONSTRAINTS WITH E -
RETAILERS -
There are orders from metro cities and also from far off places.
Increase in supply of products and lack of logistics in far off
places can be a challenge for e-retailers. Few e-retailers have
their own logistics network for intra-city and rely on third party
services for inter-city. Others depend totally upon Third Party
Service Providers (TPSP). Having warehouse at all places is also
not cost effective solution. TPSP mostly use surface network to
deliver the goods as this is the choice provided by e-retailers to
keep their distribution cost low. Utilizing air network for
delivery would be more costly. The challenge for e-retailer is to
provide timely delivery at far off places.

Each TPSP have their own strength based on their delivery

network and serviceable locations. Some pin codes can only be
serviced by few TPSP. It would make sense for the e-retailer to
tie up with 3 or 4 service provider based on his serviceable
location pin code. E-retailers can carry out a one to one
mapping for pin-code and service providers, which would be
unique. Hence when the customer places the orders, based on
his address pin-code automatically a delivery request will be
directed to the concerned TPSP. Customer could eventually
track their orders in third party service provider’s website by
providing the Way Bill number or Order number.

INVENTORY MANAGEMENT:
Online customers are target oriented shoppers. If they don’t find
what they are looking for they would immediately switch to
another website. E-retailers tie up with different distributors to
make sure they can get stock of products when they require.
There is high value items for which the demand is
unpredictable. It would be highly unlikely e-retailers would
order high value items in bulk from supplier and stock at their
warehouse. In such cases they keep only limited stock of high
value items or in some cases no stock and tie up with
distributors/ vendors to have stock, so that if high value item
orders are placed it can be fulfilled on time. The challenge arises
when the regular distributors or supplier does not have the
stock, and it has to be arranged from other distributors.
There must be forecasting done for each of the products. Based
on this e-retailers can have at least minimum stock maintained
at distributors to avoid stock out situation.

SUPPLIER SOURCE IDENTIFICATION:

If you are setting up an e-commerce business, you probably
have some thoughts on sourcing. Even if that is not the case, you
could start by reading trade magazines to find companies
manufacturing products you are interested in. You could also
attend the relevant trade shows. You could also contact trade
organizations that are associated with the products you want to
deal in, making valuable contact with their members. In fact,
these organizations aim to connect manufacturers and retailers,
even if they are from different countries. It is not difficult to
locate relevant associations. You could simply look up a
directory of trade associations.

Sourcing Directly From Manufacturers Is Desirable

But Difficult for Small Players
A manufacturer usually does not want to fuss with small
retailers. Wholesalers have a sales force, and resources, in place
specifically for distributing the products to e-commerce
businesses that will retail the products. Also, the manufacturer
wants to sell very large quantities that are usually beyond the
reach of smaller e-commerce players. If a manufacturer is
willing to work directly with you, it is most likely because they
are too small of a fish to catch the attention of wholesale
distributors. They cannot keep up with volume demands and
need to live life in the slow lane. The risk is that they will not be
able to provide you with product every time you need it.

PRODUCT REVIEWS:
Since we know that word of mouth has been playing as a great
advocate for any of your market product therefore keeping a
room for costumer reviews on your page about your service,
product quality and order delivery will definitely make your
those costumers motivated who are still confused whether to
buy a certain product or not. Allowing your customers to review
products they’ve bought lets them express how they felt about
the overall experience and the product itself is the perfect way to
get your products validated by a third party.

PICTURE QUALITY OF YOUR PRODUCT:

When buying a product online we want to make sure about all
the related features we are looking for in a product and its
quality, therefore adding a quality picture from a profession
camera or a smart phone with HD results would definitely help
your costumer to make a mind of that product appearance,
therefore a nice and clear image with all the angles would be an
edge for your product sale. For more information about taking
quality shots, CNET suggests the following:

• Clean your lens

• Shot with lots of light available
• Try different angles
• Increase your resolution
• Check out specialty shooting modes
• Get help from apps (my personal favorite is Camera+ on iOS)

TRENDING OR RECOMMENDED PRODUCTS:

Previewing recommendations and trending product will help
your costumers to broaden his option list, therefore suggesting
some product based on your clients interest at the end will make
a chance for another product purchase for example a costumer
is buying a pair of heels from your page while he is making a
click for details make an auto recommendation for a matching
bag, you never know that he might be looking for a bag already
from other page. If its so he will purchase bag as well. Therefore
recommendation plays a handy role for you product sale.
EXCELLENT PRODUCT DESCRIPTION:
Describing your product completely is the moat essential tool
for your sale, describe each and every part of your product
including its size, color, most importantly price, weight and
every thing that is important for your product therefore there is
no ambiguity left in your costumers mind about its purchase. All
you have to do is to focus on product benefits, avoid any jargons
or in other words make it as simple as possible, add its USP, use
motivating language for describing your product.

CONVENIENT PAYMENT AND CHECKOUT OPTIONS:

Your checkout page is the final stop on people’s shopping
journey. And one of the best ways to increase conversions and
sales is to make it hilariously easy for folks to pay you. After all,
it’s the place where visitor finally become your customers. To
help make your payment process as easy and simple as possible,
follow these six tips:
• Have several payment methods available
• Don’t force people to sign up
• Make sure your checkout page matches the rest of your store
• Don’t redirect people
• Make errors easy to fix
• Don’t ask for unnecessary information

CUSTOMER SERVICE:
Simply a customer is not only one time job the major emphasis
when selling a product is to make your customer as happy that
he will always go for your name when it comes to shop therefore
Providing customer support, valuing their feedback, and
providing them all access to negotiate about there product will
make you to approach a never losing customer therefore
customer support is a key to your after sale service word of
mouth.
Once you have applied these simple six strategies to your online
shop you will be watching an improved sale and attracted
costumers on your page. Let these spells work on your E-
business to make their way toward success!