As the world moves towards same-day and even one-hour delivery services across the e-commerce landscape, retailers are undergoing a critical review of their current fulfilment strategy and the need for change is obvious.
Disintermediation is defined as the removal or reduction of intermediaries between sellers and buyers. In other words, cutting out the middleman.
It’s simple: Retailers want to get their products to their customers as quickly as possible, while impatient consumers are focused on speed and convenience.
Disintermediation in e-commerce fulfilment is all about removing the dependence on an intermediate hub, whether a 3rd party logistics (3PL) provider or fulfilment centre, to process your international orders. The last thing you want to be explaining to an international customer is that their order is first travelling from your warehouse to a ‘3rd party hub’ where some logistics voodoo will be performed on their package, before it’s finally sent out to them. Outsourcing international fulfilment can be risky for brand integrity.
With platforms like Amazon careening towards an almost instantaneous delivery model, smaller e-commerce players feel increasingly localised, with their outreach reduced or, at best, severely limited. How can retailers get their products to customers quicker? It becomes seemingly impossible to grow an e-commerce business globally when an impatient consumer mindset won’t settle for traditional delivery times.
A move away from bricks and mortar fulfilment altogether is also now afoot: a few months ago, Ali Baba’s CEO, Jack Ma, predicted the future of logistics was in figuring out a way to eliminate warehouses and get product to the consumer without intermediary steps. Amazon, too, recently filed a patent for flying warehouses, with an army of drones making local deliveries from these inventory motherships flying above our heads.
Cutting Out the Middleman
High growth e-commerce businesses are busy analysing all the steps in their current fulfilment process, highlighting those that could either be in-sourced or eliminated altogether. Getting rid of the middleman has two main benefits: It saves money and cuts down on delivery times; leading to a jump in customer satisfaction, which in turn leads to increased turnover.
It sounds attractive in theory, but does it work in reality?
The Pitfalls of Disintermediation
Whilst disintermediation does bring benefits, your business will now have to step up and perform this role itself. What will that entail? International fulfilment providers offer a specialised service, and it will now be your job to deliver either a better or similar one, ideally at a reduced cost. Does it make commercial sense to build the in-house knowledge and skill of a 3PL or fulfilment provider? Can your business do the same or better job at a lower cost?
Focus on your competencies. If you bring these international fulfilment tasks in-house, you will be operating outside your comfort zone, which may initially put you at a disadvantage.
The Era of Reintermediation
E-commerce fulfilment partners and 3PLs are aware of the inherent bricks and mortar nature of their business, which is proving a hindrance in a world where speed, seamlessness and automation are paramount. It’s now crucial for these intermediaries to be seen as more automated, fast and efficient, instead of being an unnecessary and counter-intuitive layer of cost and delay, to an otherwise instant electronic transaction. This is where we see the rise of reintermediation.
Reintermediation (aka Logistics-as-a-Service) is a best-of-both-worlds alternative – It eliminates unnecessary intermediate steps and doesn’t require the development of in-house logistics skills and knowledge. Rather than being entities with physical infrastructure, reintermediation calls for this new wave of 3rd parties to be solution providers instead; providing a simple automated on-demand solution that isn’t shackled to the physicality of bricks and mortar; yet provides complete control, visibility and cost saving with fast and direct deliveries to your international customers, no matter where they are… After all, it’s called ‘e’ commerce for a reason, and shouldn’t be constrained to a physical 3rd party warehouse with a multi-step shipping process.
As the pioneer of reintermediation, Swipezoom provides a lightweight and automated solution, eliminating the need for middleman warehouses and hubs, getting your products to customers in more than 230 countries. In short, we give you the tools you need to replicate the black magic that 3rd party fulfilment centres currently perform on your international shipments. You can now instantly transform your existing domestic infrastructure into a global fulfilment centre, processing all your international e-commerce shipments yourself at the click of a button; faster, cheaper, and without the need for developing any in-house logistics skills.
Swipezoom also helps your business achieve a global reach, while giving your customers a local feel: accept a variety of payment methods in an array of currencies on your website, while getting paid in your currency every time; all this with your business bearing no financial risk of fraud or currency fluctuation.
So if you’re looking to streamline your global e-commerce fulfilment and increase your international sales, give us a call.