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Analysis on the Differences between E-commerce Logistics and Traditional Logistics

  • Edit:FLOA LOGISTICS CO.,LTD
  • Date:2024-09-05
  • Visits:1351
  • Sort:Industry trends

Everyone has discussed a lot about how traditional logistics can adapt to the e-commerce model. But most of them focus on the thinking level or the planning level; That is, how to use e-commerce thinking to make decisions, interact with customers, and set categories. If we want to talk about the similarities between the two, as logistics: both tradition and e-commerce are initiated based on the flow of goods; And all aim to achieve the logistics goal at a certain controllable cost. This goal is to deliver the products to the right place and the right person at the right time and in the right way. This is one of the few things we can find in common. This paper mainly analyzes some real work situations to see through their differences.




Before this, we must master some pre-information, which is the basic starting point for us to analyze similarities and differences. In other words, it basically stems from these seemingly simple but basically recognized changes that lead to the difference between traditional and e-commerce logistics models! Considering the rigor, we will focus on the retail department store industry. From three aspects:




First, on the surface, e-commerce has compressed space and accelerated time. Space refers to the concept that there is basically no traditional distance between end users and enterprises, and the world is almost the same, while the acceleration of time means that space is actually virtual compression, but it needs to be transformed into practical effects by speed. In terms of logistics language, channel efficiency is important; Traditional logistics goes through multi-layer transshipment and finally reaches the store, and the end users come to pick it up; E-commerce logistics is characterized by direct access to users and home delivery! Such a change greatly reduces the fault-tolerant ability of logistics, and greatly improves the requirements of agility and flexibility, that is, every transshipment point in the traditional logistics process is a verification process, which can check the occurrence of errors, which e-commerce logistics cannot and cannot allow; At the same time, as a competitive e-commerce enterprise, rapid response and changeable customers require e-commerce to cope well, which is rare in traditional logistics (especially the change of address and consignee).




Second, "small variety, large batch, small batch and long cycle" is changed into "multi-variety, small batch, multi-batch and short cycle"; This change leads to different logistics behaviors, such as inventory management, warehousing, picking and vehicle arrangement.




Third, the IT technology factor in logistics plays an important role in e-commerce logistics. In traditional industries, this factor can only be an effective supplement. The logistics system with strong IT technology is not available in many traditional logistics, which is an important reason why many large e-commerce companies build their own logistics, such as No.1 shop and JD.COM.




With such a general concept, we will easily understand and possibly go deep into every link of logistics, and analyze the differences and the causes behind them. According to the custom, we are divided into two parts: storage and distribution.




Warehouse part:




1) Storage mode: In general, the storage area and picking area are shared by traditional logistics, and its essence is determined by the above-mentioned access mode of few varieties and large quantities. The facilities in the warehouse are generally flat warehouses (stacking) and three-dimensional high shelves. Due to the characteristics of large quantities, the number of boxes is the unit of entry and exit, and even the support is the auxiliary unit; Storage and transfer are mostly carried by pallets. The logistics of e-commerce needs to cope with the characteristics of multi-variety and small batch, and at the same time, under the premise of manual operation at present, it is necessary to use special storage areas to improve storage utilization; Special picking area improves picking efficiency (mainly light shelves, supplemented by flat pallet locations). ) In the end, the warehouse layout and auxiliary equipment we saw are very different. The ABC classification of traditional warehouse categories is basically stable and the products are mature enough, so its storage location is roughly determined. E-commerce logistics is very dynamic because of various combinations and space compression, so this common way (classified storage) becomes difficult to get started, and Amazon's random storage also reflects this dilemma to some extent.




2) Pick the goods. Generally speaking, the traditional logistics has a large batch of outbound goods, which can be picked directly by forklift. When measuring the picking efficiency, the number of boxes (original packing boxes) is the main unit. RF assistance is rarely used, because the quantity is large, but the variety is few, so it can be counted repeatedly; Picking fruits directly in the picking process, or sowing after picking fruits; An order batch is large enough, and there is no need to consider how the order is formed. On the contrary, e-commerce needs to win by scale, and there are many varieties, but the number is mostly single digits, or even one or two pieces. When picking goods, one order is obviously not enough to pick fruits. It is necessary to make overall consideration of picking fruits and sowing them in waves. This kind of fineness cannot be completed by driving rough tools like forklifts, so common e-commerce picking goods are mostly RF, picking carts and turnover boxes. RF replaces the human eye to complete the verification of an action, and the turnover box replaces the mobile packaging unit (tray).




I want to emphasize here that the author thinks that the most potential for improving the operation of large-scale e-commerce warehouses is picking goods, and there is almost no one. The reason is that (1) the order of magnitude is large, with a small change, but the harvest may be quite rich. (2) At present, the picking of e-commerce cannot be mechanized in the short term, and there are great variables in implementation. How to establish a scientific process and ensure efficiency still has a lot of work to do. ③ Its complexity is higher. Compared with traditional warehousing operations, its systematic optimization idea should be emphasized here. Although, like traditional logistics, improving the efficiency of picking operations needs to start with warehousing planning, how to combine the most savvy waves, what kind of guidance path to establish, etc., it is much more difficult for e-commerce to achieve these goals, because we have to consider the ABC attributes of goods, how to combine the waves and how to optimize the path from big data; And these basic properties may still change from time to time. What I want to express is that IT technology, data analysis technology and, of course, logistics practical experience need to be perfectly combined behind this work. Due to the limited space and the suspicion of digression, we can only meet again later.




If we sum up these characteristics, it is that e-commerce needs to make a step to ensure correctness. How to do it? That is, almost every step has to be verified by a fool. Traditional picking is relatively clear. In the author's experience, many skilled picking personnel (traditional logistics) can basically remember the locations of some common goods clearly. At this time, the role of IT system can be seen. In a word, the dynamics and operation scale (data scale) of e-commerce greatly exceed that of traditional logistics.




3) Recheck, the traditional outbound recheck procedure is important, but it is basically based on quantity counting, odd boxes and variety checking, and most of them can be done manually alone, while the recheck of e-commerce is almost a re-counting, and the verification is completed one by one through electronic equipment terminals.




4) Information elements, the information elements on traditional logistics goods are not very demanding, because the appearance or physical attributes of the goods themselves can be distinguished, for example, they can be labeled, and there is no need for one-to-one correspondence between bills, that is, invoices can be circulated asynchronously with goods; However, e-commerce logistics strictly requires the standardization and integrity of label information. If there is no label or barcode information in the order content at the same time, the invoice must flow synchronously with the goods. If it is separated, it is not only a matter of cost, but also a harm to the core "customer experience".




5) Packaging: the packaging of traditional logistics generally does not need to be adjusted after it is shipped out of the factory, so there is no obvious packaging line in traditional logistics, and the reason for its packaging is reinforcement or safety; E-commerce logistics, on the other hand, is in an unpacked state because the goods have been reorganized, and the packaging line of e-commerce warehouse needs to have the ability to design packaging and respond to operations. It needs to develop packaging schemes according to different commodity characteristics and under the constraints of cost and time to ensure the safety of goods in transit. At this point, packaging is another part of warehousing logistics with the most professional and technical content.




6) Inventory: The inventory of traditional logistics is carried out regularly. Because there is no strong system constraint, inventory has become an important means of inventory management or problem exposure. Traditional logistics can stop operation for inventory, and multi-level inventory distribution also ensures the feasibility of stopping operation. E-commerce logistics cannot achieve such a static inventory, and the 7*24-hour service has always kept the warehouse in operation. Then how to ensure that the accounts are consistent? It is true that in the warehouse of e-commerce, we must first focus on controlling the process to prevent differences. (The traditional process can deviate from the system requirements and remedy afterwards. Secondly, the differences should be handled through system guidance and control, so that every change in quantity, status and position is synchronized with the system. Through the strict control of these aspects, we can make up for the lack of static inventory work. It is more feasible to make partial inventory and classified inventory.




Transport and distribution section




Traditional transportation has large batch, single type and fixed destination, which is easy to produce economies of scale; Therefore, we see that many private line companies, even one person in one car can start a logistics company, and even when it comes to distribution, there are quite a lot of them (most of them stop at stores). For traditional logistics, the last mile is often RDC (regional distribution center) to the store. For e-commerce, it is difficult to integrate because of different types of goods (such as expensive and fragile). We can understand that compared with traditional logistics, it is one kilometer more, that is, the site-customer, and this kilometer is often the core of e-commerce distribution. Specifically:




1) Source organization: The traditional transportation source is simple, and it can be attached to a single enterprise, so it can organize the operational source, and the rhythm is relatively stable and the cargo volume is relatively reliable. This is not the case with e-commerce. If a transportation enterprise intends to operate a certain area, it must have more supply targets to ensure overall stability. On the contrary, making a self-operated distribution decision also requires a sufficient order volume, otherwise the decision is unscientific and resources are easily idle.




2) Transportation planning: Traditional logistics points are fixed, and the quantity standard has a lot of planning space, especially the influence of some seasonal or traffic factors can be predicted accurately, and traditional logistics can be transported in advance. Obviously, e-commerce can't carry out transportation until the last moment of the order, because we can't predict what to transport, and the real product is the combination. Traditional logistics is different, especially in some traditional festivals (such as the Spring Festival) when transportation resources are tight, the effect of "exchanging inventory for transportation" can be achieved. The backlog of high inventory avoids the bottleneck caused by limited transportation resources during peak hours.




3) Procurement of transportation resources: For traditional logistics, the suppliers and demanders of transportation resources remain relatively stable, and the contracts are all big contracts. The advantage of big contracts is to ensure the minimum risk of operation. For example, under big contracts, carriers are easy to actively cooperate with detailed requirements. However, in the initial stage of purchasing resources, it is easy to cause commercial bribery, leading to high cost and low quality. In the process, we try to cover up the lack of operation quality. E-commerce logistics procurement makes users as direct judges to give results evaluation, and the pivotal position of transportation in the operation process makes the quality of transportation resources more transparent. What is more optimistic, however, is that e-commerce thinking affects the evolution of this transportation industry. The continuous realization of transportation resource platforms with IT technology as the core has laid the foundation for the transparency of transportation resource procurement process, and the dual dataization of processes and results may subvert the entire logistics industry, not just e-commerce logistics.




4) Last mile: The last mile of both sides has a clear-cut flag. For e-commerce logistics, the last mile plays a very important role. It is the only direct face-to-face channel for e-commerce and users. The data accumulated in the service contains the tentacles of the client and can accumulate valuable things based on data procurement and information management, which is very important for front-end market forecasting and supply chain management. With the advent of the era of big logistics and big data, the commercial value of the "last mile" will become more and more obvious. Taking JD.COM Mall as an example, in addition to the self-built logistics system, JD.COM has successively launched campus business hall, subway self-pick-up point and community self-pick-up counter service. Among many schemes, "self-promotion" has become the key word. For enterprises, intensive delivery can reduce the delivery cost and be more flexible in delivery time, at the same time, it can improve the user experience and protect the privacy of consumers. However, the problem of self-filing cabinet is that the initial investment is large, and when it can break even is still a big problem. To this end, e-commerce companies have cooperated with social resources, including examples of convenience stores and third-party service organizations, as well as products such as receiving treasures and 24-hour self-service toll stations. In the end, whether resource integration finally occupies the upper score or self-promotion becomes the best; There is no conclusion yet. Obviously, traditional logistics lacks this kind of trouble.




5) Transportation information flow: Monitoring and information feedback during transportation is very important, but compared with e-commerce logistics, traditional logistics has different emphases.




A) Basic information of transportation unit: Traditional logistics needs strict weight and volume information for a transportation unit, while e-commerce logistics is difficult to obtain these data because of package and random collocation of goods, but it is just because of package that the information of transportation unit becomes not very important, because generally, there will be no huge difference in weight and other information due to different goods in the package, nor will there be a huge difference in settlement fees. For traditional logistics, the accuracy of basic information is very important because of the large batch, and it also has important reference for the arrangement of vehicles.




B) In-transit tracking. Compared with traditional logistics, in-transit tracking of e-commerce logistics has become a part of the "ultimate product", and it should be able to give feedback to customers where they can see it at any time. Traditional logistics allows it to be incomplete or even missing.




C) Receiving feedback. In the traditional logistics industry, we take the receipt of the consignee as the final proof of the completion of the transaction, and it is the best tool to solve any dispute. Its feasibility is that there are few orders, and these vouchers must be scanned and original for file management. And in some specific enterprises, there are strict standards for signing bills, such as stamping and signing in person. One of the e-commerce industry is the implementation of collection, and the other is the combination of systematic confirmation and comment. Its huge order volume cannot be managed in the traditional way, and many enterprises are managed in the form here. Because of the characteristics of the last mile mentioned above, in order to save time, many couriers have adopted the method of automatically finding someone to collect it to ensure the success of delivery, even though there have been many phenomena of "signing under an impostor".




The above is a discussion on the actual operation of traditional logistics and e-commerce logistics. It should be noted that any evaluation is relative, that is, traditional logistics is relative to e-commerce or vice versa. There is no contrast, and some viewpoints are biased. For example, the last mile of e-commerce is important, but tradition is also important; Another example is that the traditional supply of goods is simple, but it is also quite complicated in essence. Therefore, the article itself is to let everyone understand the differences more intuitively, and some places have been enlarged. In a word, these differences are a practical feeling, and I hope to provide suggestions for related research or planning.