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Top 4 Supply Chain Issues in Ecommerce

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Last editedJun 20222 min read

The supply chain in ecommerce comes with a unique set of challenges at the best of times. However, with the various supply issues caused by the Covid-19 pandemic, ecommerce companies have had to fiercely adapt to continue to meet consumer demands.

In this post, we’ll outline some of the most prominent supply chain issues ecommerce businesses face, so you can use the information to act to avoid them affecting you.

Top 4 supply chain issues

In the digital age, consumers know what kind of service they should receive when shopping online. When an ecommerce site doesn’t meet their expectations, they can easily turn to social media and review sites to tarnish a company's reputation. This means issues such as shipping delays, stock challenges and unexpected extra fees at checkout can all result in a company suffering losses.

As customers expectations of ecommerce retailers increase, it is more important than ever to understand supply chain issues in order to prevent them affecting your business’ performance. With that in mind, below are the top 4 supply chain issues affecting ecommerce retailers today.

1. Infrastructure deficiencies

Successful ecommerce operations depend on high functioning warehouse infrastructure. This involves 3 key components:

Visibility - Using software to keep constant track of inventory
Mobility - Effective management of ingoing and outgoing inventory
Flexibility - Having the means in place to adjust and adapt to continue meet orders when errors and issues occur

Making sure the warehouse operates efficiently and productively in one of the main ways an ecommerce business can optimise order fulfilment and ensure deliveries both contain the right items and arrive on time.

2. Issues with warehouse packing

In addition to infrastructural issues in the warehouse, the activities of warehouse personnel themselves can sometimes cause problems.

Labour is often the most expensive portion of warehouse costs, but this budget should also extend to extensive and thorough training of labour staff. This involves training them on compulsory protective items (e.g. gloves, protective wear), and guidance on how to pick and pack products correctly and efficiently.

Making sure you have the right warehouse team and good training in place will help prevent problems such as lost inventory, product breakages and losses, among other costly errors.

3. Inaccurate logging of inventory

Whether a business operates exclusively online or also via brick-and-mortar store, the more stock keeping units (SKUs) a business has, the more accurate the inventory tracking needs to be.

For companies that sell upmarket, high value products, efficient inventory management is even more crucial as ineffective stock management can cost a company dearly from a financial perspective.

As well as inaccurate stock taking, issues can also arise when it comes to replenishment. Accurately forecasting how much stock is needed can be a tricky area. However, there are a number of software solutions with tools specifically tailored to optimising stock forecasting.

Zoho Inventory is an example of such a software that provides a number of tools to increase sales and keep track of inventory units. Zoho and GoCardless can also be integrated, allowing you to collect payments for Zoho invoices on time via direct debit.

4. Transport and shipping logistical issues

Whether an ecommerce business handles its own deliveries or uses a third-party delivery service, issues can arise when it comes to logistics. These issues include inexperienced delivery personnel damaging goods in transit, unexpected delays and high delivery costs.

Ensuring you work with experienced and reliable delivery companies with well trained personnel, or indeed ensuring your own delivery staff are well equipped and trained, can help eliminate the risk of some of these issues. Taking into account potential issues and having solutions and back up plans in place can also help prevent errors leading to serious problems with delivery.

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