GFS: operating a multinational e-commerce business
E-commerce allows businesses to expand beyond their physical stores and across borders so that they can sell anywhere, at any time. Reaching customers, no matter where they live offers access to larger markets and bigger profits. However, selling internationally comes with its own operational considerations, especially when it comes to delivery and returns. Customer expectations are high for seamless and hassle-free delivery and return process, so ensuring your operations are up for the task is of the utmost importance to continue to grow. With the current pandemic shining the spotlight on e-commerce and online sales up +23.8% Year-on-Year (YoY) in April, international selling through e-commerce is a big opportunity.
Importance of Delivery and Returns in a Cross-Border Ecommerce Business
Delivery and returns are important to customers, and well-executed delivery can drive growth, attract customers and retain them. IMRG's recent survey into home delivery found that 60% of consumers will buy again from a retailer if they were satisfied with the delivery. Returns are equally important, with 78% of consumers consider the quality of a returns service when choosing where to shop.
When selling across borders, it’s important to consider the paperwork and fees that need to be covered, so the delivery makes it through customs and avoid long delivery times. Transparency of any additional costs that customers may need to pay and to inform customers of any delays as soon as they happen all help provide a positive delivery experience. Customers also prefer a fully trackable delivery process so they can see where their parcel is on the journey. Transparency like this also cuts down on complaints and queries from customers, taking some of the pressure of your teams.
Retailers often focus too much on offering fast and free delivery to compete with global players like Amazon. However, we know that operationally, free delivery is a myth, and operational costs can really hurt the business bottom line. Luckily, the idea that customers want fast and free is also a myth. In fact, customers want a wide breadth of choice to choose the most convenient time and location for delivery. 45% of customers will abandon a purchase if there is a lack of convenient delivery options, so offering a choice of a particular time, day, or click and collect locations with different price points makes a difference to the purchase decision. Customers also want a simple and easy returns process should there be an issue with the item, proving that retailers shouldn't just focus on the outbound delivery service. Just as choice and convenience are important for delivery, customers control over the process to be able to pick and choose the most convenient way to return their parcel.
Satisfying Customer Expectations and Need For Operational Efficiency
They are offering all these different delivery options, especially when selling across borders, does pose a challenging task for operations. One carrier can’t provide the kind of options you need, as well as sometimes being limited by countries. When it comes to operational cost, one carrier might be cheaper in one country, but more expensive than others in another country. For this reason, working with multiple carriers is essential for running a cross-border business and offering customers the experience they expect. However, working with numerous carriers does come with its own challenges. Retailers have to manage the contracts and costs of different carriers and compare them across services and countries to ensure they are getting the best deal. Working with multiple carriers also means carrier-specific tech integrations to ensure a smooth process which puts pressure on IT teams as well as the warehouses. Also, the warehouse has to manage different carrier pick-ups that can be a logistical nightmare.
We know that working with multiple carriers is the right approach, but how can businesses achieve this without the operational headache? Working with a multi-carrier global partner like gives you access to all the carriers and competitive rates, without having to manage the relationships and contracts. It also means one delivery pick-up rather than dealing with multiple trucks driving up to your warehouses. All this, and just that allows you to offer different delivery options, full transparency on duties and taxes, track and trace, and a customer service team to deal with enquiries. It gives your operations the chance to offer a great customer experience, and still run seamlessly.
As delivery and returns are so important to customers, a seamless delivery experience is important for maintaining and growing a cross-border e-commerce business. Not every retailer will have the same resources, which is why you need to think about your capacity, customers, and strategy to ensure you have the right combination of technology and expertise to get it right. By taking the time to invest in your delivery strategy, you can ensure you can get the customer experience right, without putting unneeded pressure on your operations.
*Source: IMRG UK Consumer Home Delivery Review 2019/20
By Bobbie Ttooulis, Executive Director, Global Freight Solutions (GF
Cainiao Network Launches Customer-Centric Logistics
As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.
Who Is Cainiao?
According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00.
For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’.
What’s Part of the Upgrade?
Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments:
- Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions.
- Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture.
- Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency.
- Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311).
Where is the Company Headed?
From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’.
Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’.