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E-commerce Companies & Logistics Management

There are lots of articles available online for studying the details of how the logistics of any e-commerce company work. I won’t share a specific logistics management process of Flipkart but yes, the following process is almost same with what Flipkart follows in their logistics division.
So nowadays e-commerce companies maintain their own firm to fulfill requirements of customers. Flipkart has WS Retail for the same. Apart from this, they have independent sellers who provide products. Now for any e-commerce firm, there could be two processes to fulfill the customer order and which are:
  1. Seller - pickup hub - mother hub - delivery hub - Customer
  2. Fulfillment centres - mother hub - delivery hub - Customer
Now, when a customer orders something on the site then the seller gets the order on the web kiosk being maintained between seller and e-commerce firm. Once, the seller accepts the order for delivery, he/she clicks web kiosk for acknowledgement of the same. In order to maintain a proper process for processing orders, e-commerce firms set some time from which they calculate time given to the seller to ship the product. In this case, we’ll consider it as 11 AM that if a seller gets the order before 11 AM then he/she has to ship the order within next two days. In another case, if a seller gets order after 11 AM then he/she has to ship the order in next three days because the count of that day would get nullified. One all this happens, the seller will prepare the order accordingly for shipping to pick up hub. Now for the shipment of product from seller’s location to pickup could happen in two ways:
  1. Logistics firm owned by e-commerce itself (for example, e-kart of Flipkart)
  2. Third party logistics (3PL) firm
Now assuming that logistics firm is being owned by e-commerce firm itself so product movement would happen with the help of that firm (name it as XYZ). Once, the products reach pickup hub, there sorting would happen in following terms:
  1. Next day delivery/Same day delivery
  2. Local delivery
  3. Zonal delivery
  4. National normal delivery
  5. National express delivery
Sellers are two types:
  1. Normal Sellers who provide only 20% of the products. (They generally use bikes)
  2. Golden/Express Sellers who provide 80% of the products. (They use vans)
Sorting at pickup generally happens with the help of barcode scanning (generally). From pickup hub, products get shipped to mother hub and further sorting happens there. As mentioned earlier, there are two processes to deliver product to a customer, so at the mother hub, fulfillment centres are attached (which are basically for maintaining inventory and are generally being taken care by e-commerce owned seller firms like WS Retail of Flipkart). From mother hub, the process is same for both the processes.
Sorting at mother hub happens in two ways:
  1. Primary sorting
  2. Secondary sorting
From mother hubs, products are shipped to delivery hubs where sorting happens pin code wise. And from there on, deliveries are being made. Now delivery time being given to customers is based on this whole process. I have explained where the generic process which is almost same in all e-commerce firms in one or the other way. Take the example of Seller, he/she is taking two days to ship the product, then pick up & mother hub will take another two days to process the order and then delivery hub one more day to ship the product means: Total delivery time = 2+2+1+delay allowance, so consider one day more Therefore, Total delivery time = 2+2+1+1 = 6 days to deliver ABC product to customer. This process looks very simple the way I have written, but in reality, it’s very complex. A lot of factors and issues are being ignored while writing this process. It’s totally based on what generally e-commerce firms follow to manage their logistics processes.

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