How to manage multi-channel logistics?

The rise of e-commerce has marked the widespread adoption of the multi-channel logistics strategy. Thus, many companies choose to expand by offering a physical shop, an e-commerce entity, an app, etc., creating different distribution channels. Operating in a multi-channel way increases the sales possibilities. Nevertheless, for this strategy to work well, the retailer must implement a reliable distribution system.

What is the difference between multichannel and omnichannel logistics?

In a multi-channel logistics, the retailer provides consumers with different autonomous shopping channels. They therefore have no interaction with each other, and each follows a separate supply chain: this is a silo organisation.

Multichannel can be used by shops wishing to sell their products via the internet. The reverse is also true for companies specialising in e-commerce, which in this case open physical shops. The aim is to increase the points of contact with customers.

The omnichannel logistics, on the other hand, implies a fusion of online and offline shopping. Thus, the difference with multichannel lies in the real-time availability of all channels, with a unified view of stocks. So there is a notion of coordination between the different distribution channels.

How to ensure good multichannel inventory management

To ensure an effective multichannel strategy, it is crucial to establish good inventory management of the different sales channels. To do this, you need to :

• define a minimum stock level: replenishment should only take place when the quantity of products in stock falls below the defined level. This corresponds to your reorder point;
• maintain relationships with suppliers: this is important in the event of a rush order, a product return, or a manufacturing problem. Suppliers are thus better able to respond to your request;
• control stocks frequently: regularly compare your actual stock with your theoretical stock, especially if you encounter frequent discrepancies during your inventories;
• manage products with ABC analysis: this method is a must for managing your stock in multi-channel logistics. Class A represents your best products and generates 80% of the turnover. It is therefore one of the priorities. Intermediate products are contained in class B (15% of turnover), and finally, the least sold products (5% of turnover) are included in class C.

How to organise a multi-channel warehouse

The organisation of the multi-channel warehouse must allow for the fluid preparation of orders from the various channels. The objective is also to optimise preparation time. In order to reach the customer regardless of their purchasing channel, it is therefore necessary to :

• position the warehouse strategically to optimise product delivery;
• create global logistics within the multi-channel warehouse to keep inventory visibility at all times;
• use automation and computerisation processes for order processing to offer fast deliveries depending on the purchasing channel.

Thus, a multi-channel warehouse must be able to manage its inventory to meet customer demands, whether they want to be delivered in-store or at home.

How to ensure efficient multichannel deliveries

Customer satisfaction is at the heart of retailers’ concerns. This is heavily dependent on the delivery of goods, so multichannel logistics must incorporate this into its strategy. To provide customers with an optimal delivery experience, make sure you :

• Choose the right partners: it is best to opt for a delivery service that offers a tracking number to monitor deliveries. Similarly, if orders are to arrive on time, the condition of the package is also important. Choose a quality provider to ensure deliveries.
• Offer different delivery methods: A strategic element, the choice of delivery must be sufficiently developed to offer the best possible user experience. Home delivery is particularly popular, so it is imperative that you offer this option. In order to keep your customers and offer them less expensive delivery services, you can also offer click and collect, delivery in a relay point, in a locker, or directly in shop.
• Optimise delivery times: speed is now a criterion of choice for consumers. Fast delivery is a major issue for customer satisfaction. Depending on the service provider ensuring delivery, you can offer express deliveries, in 24 to 48 hours, which are particularly appreciated.
• Automate delivery notes: the printing and application of delivery notes must be accurate to limit the risk of errors. Opting to automate these processes allows for better identification of the package, in addition to speeding up shipping.

How to optimise your multi-channel logistics costs

In order not to generate too high costs with multi-channel management, the important thing is to carry out a precise follow-up. This involves, on the one hand, controlling the budget dedicated to the logistics part, and on the other hand, controlling the budget dedicated to transport.

Several actions can help you optimise costs in multichannel. This is particularly the case for :

• the use of a single warehouse to store your goods: although the different channels used by customers operate independently, the overall management of the business can take place within a single warehouse. This avoids the additional costs associated with multiple storage points. Costs are optimised through simplified and central use of the various technological tools needed for the business, but also of the machines and personnel essential for the smooth running of the chain;
• the implementation of a communication between all channels of your sales system;
• a strategic choice in packaging to drive down the cost of transport: ideally, you should be able to ship products in the smallest and lightest possible packaging;
• the automation of the packaging chain, an ideal process to save time on the packing phase.

Successful multi-channel distribution therefore requires the implementation of a clear and precise strategy. By allowing the consumer to buy your products from different sales and distribution channels, you optimise your chances of converting new customers.