Making Sense of Retail Logistics: Challenges, Trends & More

By | November 16, 2022

These are just a few of the innovations we’ll see as retailers vie to get their products to us the fastest route possible. In terms of revenue, the Global Retail Logistics Market is expected to reach USD 430.9 Billion by 2028, growing at a Compound Annual Growth Rate of 11.9% from 2022 to 2028. With an increase in the use of smartphones and e-commerce services across the globe and quick delivery facilities prov… Increased road connectivity in developing countries and excellent road connectivity in all industrialized countries is a crucial factors supporting the rise of the highway mode of transportation. Roadways will connect most tier 2 and tier 3 cities in many countries, allowing Retail Logistics businesses to deliver and pick up merchandise.

What is an example of retail logistics

The single-carrier versus multi-carrier philosophy is one of the primary issues that need to be addressed with regard to carrier relations. Using one carrier allows a higher aggregate volume of shipments, which can result in lower negotiated rates. The downside is total dependence on one carrier and the resulting possible problems if there is a carrier service interruption. Loss of shipping and handling revenue if refunded from outbound or inbound transaction.

What are Retail Logistics?

Obtaining the essential resources and materials needed to develop a product/service, including finding vendors, managing vendor relationships, negotiating costs, etc. In response to the pandemic, supply chain issues retail logistics software and climate change, consumer needs and desires have shifted. Retailers would be wise to meet consumers where they are and embrace change, especially around sustainability, transparency and customer service.

Most retailers see international sales as their largest opportunity for growth. Internet Retailer magazine recently published a list of the biggest hurdles for retailers to do business overseas. The difficulty of shipping merchandise was identified by 42 percent of retailers as their No. 1 hurdle in doing more business internationally.

What is the retail supply chain?

For example, with retail warehousing, it isn’t enough for companies to indiscriminately place materials they’ve received on shelves. Retail logistics is a fast-paced process, and warehouses are typically high-traffic environments, so warehouses should be arranged in a way that facilitates logical inventory flow. Similarly, stock-keeping units must be strategically organized to enhance productivity and efficiency, with popular items easily accessible to warehouse workers.

What is an example of retail logistics

This allows companies to place smaller and more frequent purchase orders, meet arrival deadlines, and expedite deliveries. For example, if a company wants to ship products to a retail store but does not have enough product to fill up a full truck, it can place its cargo with that of another brand that is shipping products to the same client. Warehouse employees, for example, normally carry out multiple tasks when picking and preparing online orders. VR combined with AI can help warehouse operatives pick out where products are located much faster.


The introduction provides a high-level view of the areas in which logistics plays a significant role in a multichannel retail operation and describes common, related cost trade-offs. “Four Key Logistics Goals” — increased efficiency, improved customer service, increased sales, building relationships —outline a strategy to optimize multichannel retail logistics management. The goals are illustrated with tested best practices used in operations departments in areas including vendor compliance, managing back orders and returns and building vendor relationships. A final section gives specific examples of logistics solutions in such areas as inbound and outbound logistics, IT and merchandising that can help multichannel retailers to achieve optimum supply chain efficiencies.

What is an example of retail logistics

The region has a large client base and has seen individuals’ widespread use of e-commerce channels. China, Japan, Australia, and India are the top item exporters, accounting for a significant portion of global retail e-commerce sales. As a result, the regional market expansion is primarily driven by the region’s potential e-commerce growth prospects.

Adopt Sustainability Trends to Drive Down Costs

Common transportation modes for retail logistics include rail, trucking, sea freight and air cargo. Rail and trucking are the most common modes for short-distance shipments. Sea freight is usually used for international shipments, while air cargo is used for expedited deliveries. Once the product is received and inspected, the retailer will issue a refund or exchange, depending on the customer’s preference and the retailer’s policies. Retail businesses sometimes offer store credit or gift cards instead of a cash refund. Retail businesses have a clearly stated return policy outlining the rules, timelines, and processes for returning products.

What is an example of retail logistics

If done right, shipping incentives are also used as marketing tool, such as 2-day shippingandfree shipping. Throughout the entire ecommerce supply chain, it’s important to have systems in place to manage inventory in real-time. $23 trillion, and experts predict ecommerce demand to continue expanding. One of the biggest challenges for growing ecommerce businesses today is managing increased order volume. Another challenge is dealing with returns and refunds, as these need to be processed quickly and efficiently to keep customers happy. Finally, there is also the challenge of dealing with seasonal peaks in demand, such as during holidays.

Don’t miss the key steps to fulfillment success

For high-return categories and businesses, reverse logistics services typically allow customers to send returns into the pipeline closest to their location, either at home or via a retail outlet. The reverse logistics provider should offer systems that provide visibility into goods being returned in advance of receipt in the retailer’s distribution center. This will not only allow the merchant to schedule resources accordingly, but it will also give the merchant an estimate of return goods that will be available to fill new customer orders. Additionally, some retailers start the refund or credit process when customer returns have been received. • Transportation costs are high because items are shipped back in small quantities. • Reverse logistics is sometimes called ‘aftermarket supply chain’, ‘aftermarket logistics’ or ‘retrogistics’.

  • Sending inventory to distribution centers is done too quickly to ship products to the customers.
  • Ultimately, retailers need automation to streamline task management and customer service.
  • The retail store being the fundamental source of revenue and the place of customer interaction, is vital to the retailer.
  • Wal-Mart has only implemented RFID with about 130 vendors, using 5.4 million tags in the past year, and approximately 1,000 stores are ready to receive RFID product.
  • Our cloud based customer portal is the perfect solution for tracking our retail logistics projects together.
  • During peak order shipment periods, this causes down time and an interruption to the workflow when there’s no empty trailer ready to load.

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