Online Retail VS Physical Retail: Logistics Varies

Because online retailing has the characteristics of super space time, cross region and low cost, it is more in line with the consumption habits of contemporary consumers and poses a direct challenge to traditional physical retailing.

Faced with such challenges, traditional retailers can not avoid and concession.

If the traditional retail enterprises want to foster strengths and circumvent weaknesses and go out of the road of innovation, we first need to identify the differences and characteristics between ourselves and our competitors.

Logistics characteristics of online retailing and physical retailing

The main differences between online retailing and physical retailing are commodity form, trading location, paction mode, and delivery form.

In the form of online retailing, goods are virtualized and space display is diversified, and commodity categories are wide and complete, but consumers can not get the goods, but can not even touch them. They must rely on the distribution of goods to the consumers and settle the accounts on the spot.

In the form of physical retailing, goods are furnished in kind, and consumers can see and get them.

Moreover, the consumer completes the business paction after the sales site checkout.

As a result, the most important difference between online retailing and physical retailing is the form of delivery of goods to customers. Therefore, "last mile City Distribution" has become the key to the success of online retailing.

Therefore, careful analysis of online retail and physical retail.

The most important difference between online retailing and physical retailing is the form of delivery of goods to customers. Therefore, the "last mile urban distribution" has become the key to the success of online retailing.

Commodity flow direction

Compared with physical retail, online retails use the convenience of the Internet to display virtual goods and all kinds of related information to terminal customers, and directly receive customers' orders from the Internet, and then use the way of directly distributing goods ordered by customers to the terminal customers, thus saving the traditional logistics distribution links from the distribution center to the retail outlets.

However, compared with online retailing, physical retailing does not distribute the final order to the logistics distribution link of the terminal customers, but uses the way that customers arrive at stores and directly choose physical goods.

Although the "home delivery" mode of online retailing provides convenience for customers, the complex distribution of goods, which greatly increases the cost of logistics distribution and the difficulty of logistics management, will be specified in the fourth part.

Two. Inventory management

1. varieties

Physical retailing is a demand - oriented balance between supply and demand.

The ABC attribute of goods refers to the frequent conversion of goods.

2. quantity

Under the restriction of purchasing cycle and supplier logistics level, physical retail must maintain a certain safety stock. However, for C products or unsalable D products, they can minimize inventory or even do not stock.

Compared with physical retail, although online retailing is also restricted by the purchasing cycle and supplier logistics level, it needs to maintain a certain safety stock. However, it is also necessary to maintain inventory for C products or unsalable D products.

This characteristic is defined as the "long tail phenomenon" in the industry.

As a result, the base of retail products in online retailing is huge, and the number of days in store is long. But the average stock of each variety needs to be kept low, so long as there is "yes".

For a class of commodities, mainly refers to those who apply the principle of "2/8" distribution of goods distribution, and with the increase of varieties and sales trend is more obvious.

At the same time, there is still a big stockpile / promotional shipment.

3. volume

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However, in online retailing, the size of commodity packaging is very wide because of the large variety of commodities and the comprehensiveness of categories.

Although the main products are similar to the size of notebook computers, the possibility of super small and super large items is also great.

For the logistics of online retailing, the packaging rules of commodities are also important. The probability of irregular commodities will increase correspondingly when the number of varieties increases.

Thus, under the network retail, logistics will face the following problems:

(1) how should we deal with dispersed packaging sizes and irregular commodity factors?

(2) the size of small and medium size goods may be several times the same size. If a uniform standard medium container is used to load a large number of small items, the loading rate of containers will be reduced, and it will lead to manual picking.

So, how to solve this problem?

(3) how can we adapt to all kinds of packaging containers when the shelves and storage spaces are relatively fixed? We can conclude that the above 3 factors can be compared with physical retail.

Emphasis is placed on the pre classification of goods with different specifications and loose sales, and different inventory models are defined according to different classifications.

4. order processing

(1) shipping unit

In physical retail, according to the scale of different retail stores, the ordering units of retail stores are divided into whole pallets (batch), box type (whole box) and scattered (unpacking).

When ordering, the distribution center will operate differently according to the different unit of shipment.

In online retailing, most of the ordering units are scattered mainly because of the distribution of individuals.

The distribution center must carry out the whole product zero sorting operation.

(2) order size

In the physical retail, the order shop of the retail store order (the number of order varieties) is more than 10 in most cases (except for special emergency cargo), for example, the order goods of the hypermarket may reach hundreds of varieties. The order quantity of each commodity variety depends on the sales scale of the stores, but most of them are in the whole box.

In online retail, the buying habits of individual customers are generally reflected in fewer varieties and fewer quantities. More than 50% of the personal customers will not purchase more than 5 products 1 times.

However, with the rapid expansion of the varieties of marketable marketable varieties, the category of customers can choose to be comprehensive, and logistics needs to deal with the expansion and changes of the following consumption habits:

Will there be a rapid increase in the number and quantity of orders ordered by A.?

How is the distribution of B. orders in each category?

Is the growth trend of C. cross category orders obvious?

5. personalization

(1) processing

Online retail is a way of determining promotion for different individual customers, such as buying gifts, bundling sales, and so on.

This requires that the distribution center must make two different processing (including physical and systematic processing) for the sale of goods.

The simple processing of physical goods, such as wrapping different items of goods purchased with tape, can be handled by two ways: first, no processing; second, using BOM (Bill of Materials logistics list) to convert various original goods (as raw materials) into new sales products.