Facing Omnichannel Obstacles, Shippers Turn to Logistics Network Optimization to Connect the Dots

As the digital revolution transforms the retail industry, omnichannel shipping has become crucial to providing customers with a seamless shopping experience. Customers now expect so much of the shopping experience, including online ordering, in-store pickup, and same-day delivery. However, implementing a successful omnichannel strategy is easier said than done. Shippers face many obstacles, such as managing inventory across various locations, optimizing shipping routes, and ensuring timely delivery across diverse channels. 

Fortunately, shippers can leverage Intelligent Audit's suite of logistics network optimization tools to streamline complex omnichannel supply chains and remove obstacles to provide successful omnichannel shipping. This article dives into shippers' challenges when implementing an omnichannel shipping strategy. It also explores how Intelligent Audit's platform can help shippers connect the dots in their supply chains, streamline their logistics processes, and meet customer demands with unprecedented ease.

Omnichannel Shipping Provides Its Fair Share of Challenges

An omnichannel supply chain is one that focuses on providing customers with a seamless, integrated shopping experience across multiple channels, such as brick-and-mortar stores, online platforms, curbside pickup, and various delivery options. As companies embrace this approach, they must also optimize their omnichannel fulfillment networks to reduce costs and maintain service levels. 

Here are some of the challenges facing omnichannel shippers:

Fragmented Supply Chain Processes

One of the significant challenges facing omnichannel shippers is the lack of interoperability caused by fragmented supply chain processes. This can create siloes within the supply chain, which hinder communication, decrease efficiency, and increase finger-pointing. This makes it challenging to develop a robust omnichannel logistics ecosystem.

Inventory Management

Accurately tracking inventory proves challenging due to a myriad of order channels and upstream suppliers. Shippers who lack visibility and control risk errors, delays, and inaccurate information about available stock. Poor inventory management can lead to missed sales opportunities, unhappy customers, overpaying for expedited shipping, and unnecessary fire drills for your team. 

Manual Fulfillment Processes

Traditional omnichannel fulfillment processes lacking technology are prone to delays, manual route planning, and high overhead costs. This slows operations and can interfere with providing a seamless customer experience.

Inefficient Reverse Logistics

Effective reverse logistics processes are crucial to maintain efficiency and customer satisfaction in omnichannel operations. The beauty is that customers can utilize multiple channels to make returns even if the initial purchase was made from a different store or channel. 

Inefficient reverse logistics processes can delay returns processing, lowering customer satisfaction. Delays may later result in the mishandling of inventories, causing overstocks or stockouts that can hurt the business's revenue stream.

Lack of Data

A lack of data results in poor visibility and potential challenges such as customer complaints, decreased customer retention rates, and delays in shipping/delivery. Leveraging data promotes fact-based decision-making, enabling management by exception and strategic transportation optimization.

Applying analytics leveraging holistic supply chain and shipping data can drive more value in transportation networks while improving throughput at distribution centers. Advanced analytics and omnichannel software can offer retailers better tracking of labor, vendors, and scheduling efficiency. This leads to end-to-end visibility, network optimization, and precise ROI projections.

Omnichannel shipping provides its fair share of challenges, but many solutions exist. By leveraging advanced analytics, optimizing logistics operations, and implementing a robust omnichannel supply chain strategy and omnichannel software, shippers can deliver a seamless customer experience and drive revenue growth.

As Obstacles Abound for Omnichannel Shipping, Logistics Network Optimization Connects the Dots

An omnichannel supply chain offers convenient one-touch integration to provide a streamlined customer experience. The closings and reopenings due to the pandemic made retailers realize an omnichannel supply chain strategy was needed to integrate e-commerce into their plans. Contactless pickup and delivery options are still in high demand, and customers prefer convenience and flexibility in their shopping experience.

With the rise of omnichannel shipping, many companies are experiencing new challenges that require innovative solutions. As the industry evolves and shippers adjust to their new normal, they must adopt strategies and tactics to optimize logistics networks and overcome obstacles. 

Here are some ways logistics network optimization can help:

Demand Forecasting

When shippers can accurately predict what consumers want, they can avoid frustrating stock-outs and ensure adequate inventory. And let's face it: nothing is worse than telling a customer, "Sorry, we're fresh out." But demand forecasting isn't just about avoiding angry customers. Demand forecasting involves predicting consumer demand before it happens, and it is critical to optimizing logistics networks. 

Shippers can make informed decisions and minimize risk by leveraging advanced analytics and omnichannel shipping software. With accurate demand forecasting, shippers can improve inventory management, avoid stock-outs, and reduce costs. It's like having a crystal ball that tells you exactly what you must do to keep your business running smoothly. And who wouldn't want that? 

Inventory Optimization

Effective inventory management is essential for optimizing logistics networks. Supply and demand trends directly impact peak-season inventory management and fulfillment. To strengthen the supply chain, managers must closely monitor inventory sourcing, demand planning, warehousing management, inventory management, and customer service. Strategies for successful peak season preparation include:

  • Striking the right inventory balance
  • Stress-testing operations and procedures
  • Communicating with vendors and team members
  • Embracing digital marketing and shipping tools
  • Adapting quickly to changing trends
  • Using modern technology for real-time tracking and monitoring of data
  • Utilizing analytics to improve inbound movements

Order Routing & Fulfillment 

Petco, a leading pet supply retailer with a network of brick-and-mortar stores and distribution centers, faced unique challenges in optimizing its logistics network for e-commerce fulfillment. To achieve its goals of reducing transit time, minimizing costs, and improving overall efficiency, Petco turned to Intelligent Audit's analytics platform for help.

Intelligent Audit's solutions helped Petco by running dynamic modeling scenarios, analyzing ground and zone downgrade opportunities, incorporating capacity and inventory level restrictions, and identifying problem areas. They also helped Petco improve tracking, maximize productivity, and identify opportunities for new stores and fulfillment centers.

“Intelligent Audit’s analytics tools were exactly what we needed to not only test our thesis that we needed to expand our store network, but it also helped us understand how to do so in the most efficient and scalable way possible.” Christopher Fall, Manager, Omni-Channel Fulfillment, Petco

Intelligent Audit's analytics platform enabled Petco to optimize its logistics network, reduce days in transit and expenses, and utilize parcel carrier selection for the fastest possible delivery times. 

Last-mile Delivery Optimization

Last-mile delivery is the most complex and expensive part of the supply chain, and costs are increasing due to rising consumer demand for fast and free delivery. Utilizing analytics to track and reduce last-mile delivery costs is essential for shippers adapting to changing market demands. 

With Intelligent Audit, you can evaluate and fortify your supply chain, diversify your carrier portfolio, and receive data-based guidance to negotiate with carriers effectively. Simulate shipping routes to develop cost-effective and efficient solutions. Use machine learning to identify which transportation mode is the best option for each load, and consider direct injection options to reduce expenses while improving delivery times.

Analytics can help shippers improve route selection, manage delivery rates, and provide real-time delivery updates. Automation and AI technologies like improved communication platforms, data-sharing tools, driver decision-making capabilities, and on-demand status reports can also optimize last-mile delivery services.

Performance Measurement & Benchmarking

Performance measurement and benchmarking are essential for optimizing logistics networks. Shippers can identify improvement areas and make informed decisions about logistics operations by tracking and analyzing key performance indicators (KPIs). Some essential KPIs to track include average and running monthly spending, on-time pickup and delivery, zone distribution, the average cost per shipment, weight distribution, packaging and dimensional weight, approved carrier/service routing, and freight invoice accuracy. By monitoring these metrics and comparing them to industry benchmarks, shippers can identify areas for improvement and optimize logistics networks for better performance and cost savings.

Logistics network optimization is critical to overcoming the obstacles facing omnichannel shippers. By leveraging advanced analytics, modeling tools, and performance measurement and benchmarking, shippers can optimize their networks and deliver a seamless customer experience while reducing costs and increasing revenue growth.

With More than Two Decades of Innovation Experience, Intelligent Audit is the Transportation Industry’s Choice for Logistics Network Optimization

Omnichannel shipping presents unique challenges to shippers, from siloed supply chain processes to poor reverse logistics operations. Logistics network optimization is critical to overcoming these obstacles and delivering a seamless customer experience. Intelligent Audit is the transportation industry's choice for logistics network optimization, offering a range of services that enable shippers to optimize carrier mix, diversify carrier portfolios, and model scenarios using historical and real-time data. With AI alerts and machine learning algorithms, Intelligent Audit quickly identifies new patterns and helps shippers make smarter decisions based on data.

With more than two decades of innovation experience and a wide array of services, Intelligent Audit is the transportation industry's choice for logistics network optimization. Our expert team uses machine learning algorithms to analyze data in real time, providing customers with contextual details and actionable insights. We offer services, including benchmarking data, mode diversification, strategic roadmaps, dynamic scenario modeling, and AI alerts. 

Get started with Intelligent Audit today to optimize your logistics network and deliver a better customer experience. With their unmatched Freight Audit, Recovery, Analytics, and Payments services, Intelligent Audit empowers shippers to take control of their logistics management and make smarter decisions in uncertain times. Contact Intelligent Audit today to learn more about their services and how they can help you optimize your logistics network for better performance and cost savings.

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