Setting up the Logistics Department for Startups and E-Commerce Businesses

TL;DR

• Logistics in e-commerce involves moving goods from the warehouse to customers, which can be managed in-house or outsourced.
• In-house logistics provides control and may suit businesses with high volume and strict scheduling.
• Outsourcing reduces costs, paperwork, and allows focus on core business tasks.
• Startups may benefit from third-party logistics (3PL) to avoid long-term investments and focus on growth.

Even though we do not always notice or even rarely think of it, logistics is all around us. When we go to a store, we do not think how those goods got to the store, or what is the process that companies have to deal with, for us to have the final product in our hands. In this article, we will give you an explanation on how to set up a logistics process within your startup.

Fun, creative, and unique store shelves are usually luring customers inside. Before reaching their final destination, all those products had gone through a whole logistics process, from production to distribution. One part of the supply chain is the distribution of the products to the customers. That process where your goods get from point A – the warehouse and reach point B – the customers, is called the logistics process. Before starting a business and opening a physical store, it is important to think of many factors such as finding the perfect location, having a good and attractive window store to incentivize more customers. This can add to the cost of the firm, thus to the final price of the goods to be sold.

What does logistics in e-commerce and startups mean?

When dealing with selling of physical goods, whether you are a startup or e-commerce, you will need to arrange the flow of the goods from point A to point B. The logistics, or the movement of the goods from the warehouse to the customer, is something that you need to decide whether you will do it on your own or hire someone else to do it for you.

One of the reasons that e-commerce stores showed a lot of growth in the past decade is that they can avoid certain costs such as finding a perfect location for distribution of your products, filling the shelves with appealing products, constantly changing the window store etc. Also, as an e-commerce owner, you will have the great advantage of having a warehouse on a location of your choice. In such a case, you do not have to worry whether this location is easily reachable to the customer or not.

When is it a good time to set up a logistics department for my e-commerce business?

Some firms need a bigger set of logistics processes within their company, and some not as much. Are you not sure whether you should handle your logistics processes on your own? If your business is related to selling and shipping physical goods, then maybe we can give you some advice to make the decision easier:

Setting up logistics management within your company

• Volume – As you will most likely need to transport goods daily, you should make a proper calculation of the costs of having this process in-house, while at the same time considering the opportunity costs if you outsource it. If the volume of production and shipments to be delivered is quite big, then you should consider setting up logistics department for your e-commerce startup business inhouse.
• Schedule – by organizing this in the framework of your company, you have full control over the shipping and the entire process.

Outsourcing your logistics process

• Reducing costs – Businesses can outsource their logistics process by hiring a third-party logistics company. Given their expertise in the field, hiring 3PL (third-party logistics company) providers for your startup business will have you eliminate the costs of employing experts in-house.
• Paperwork – Are you not a fan of bureaucracy? Then we suggest considering outsourcing as, having logistics management inhouse would mean a lot of paperwork and invoices to be handled.
• Focus – You can now focus on your core task of the business! You can reallocate all your resources and use them to perfect your product instead of spending the time setting up your own logistics processes.

Many online stores are operating in the fields of fashion or electronics and are selling their products on platforms such as Amazon, eBay, Alibaba, Shopify etc. As an e-commerce business that delivers products to customers, you should also have a tracking system, so the customer can have updates on the ordered items. If you decide to outsource this part of the business you will most likely be using the couriers tracking system.

Have you decided to take advantage of and use the benefits of outsourcing the logistics department of your firm? Consider partnering up with Eurosender!

As a leading platform for booking reliable global shipping, we can offer to take care of the delivery of the goods at an affordable price. Having efficient logistics management within your company can be of great importance for the growth of your business, so use the benefits of outsourcing the logistics department of your business and let us take care of this!

Reshipping services can be arranged with Eurosender. As this is a non-standard service, you would have to contact our sales department and request an individual offer to match your requirements.

Should I set up a logistics department for my startup business?

If you are starting a new business, you might want to keep things in the long term. Start-ups do not necessarily have the means to manage their whole logistics process meant for the long term as it could take up to several years to see a return on investment. Considering hiring a 3PL provider for your startup to take care of the transportation of the goods can take a huge burden off your shoulders, as you will not have to perform all the tasks on your own.