Is running your own e-commerce warehouse the only choice?

More and more entrepreneurs seeking their place in the e-commerce market are choosing to move away from the traditional business model of running their own warehouse. Instead, they are opting for innovative solutions that allow them to save time and fully focus on developing their brand.

Running an e-commerce business involves many different tasks. It is therefore the owner's responsibility to organise the entire sales process so that it runs smoothly and creates customer satisfaction. It is therefore very important to choose the right logistics model for your business.

Appropriate logistics model

A logistics model is how an e-commerce owner will manage the sale, storage and dispatch of their goods. There are many options on the market today that entrepreneurs can use. It is worth remembering that the choice of a particular model is not binding, so there is the possibility to try other options after some time.

Still the most popular and widely used logistics model by entrepreneurs in e-commerce is to run their own warehouse. It is undeniably the most flexible option, which the owner can adapt directly to the needs of their business.

The entrepreneur's own storage facility enables him or her to have permanent and unproblematic access to the goods stored there and full control over the operations carried out there. The lack of intermediaries and the self-construction of the warehouse structure will certainly be a great advantage.

However, this solution does not seem to be the most advantageous for everyone. Rapidly growing e-commerce is taking up more and more of the owner's time, which he is not always able to spare. In addition, there is the need to hire new employees or rent more warehouse space when the current space is insufficient.

If not your own warehouse, then what?

Entrepreneurs who would like to focus solely on building the reputation of their brand, thus shifting the responsibility of looking after the warehouse to an external company, can use 3 other logistics models:

• Fulfillment

Fulfilment is an outsourcing model whereby the entire logistics involved in storing and shipping goods is handed over to an external company. Using this solution, there is therefore no need to have your own storage space - the products are stored in one of the operator's warehouses. An entrepreneur who decides to use fulfilment also does not have to worry about hiring employees. This is also the responsibility of the external operator.

As soon as a customer makes a purchase in the online shop, the fulfilment company receives a notification and automatically proceeds to process the order placed. The return process is also the responsibility of the third-party operator. The only thing left on the owner's mind, then, is the promotion of the shop and the acquisition of new customers. Find out more about the InPost Fulfillment service and get in touch with us using the form."

• Dropshipping

If you don't have the goods... there is no problem with stocking them! This is why entrepreneurs are increasingly investing in dropshipping. This model allows you to run your business without having to buy an assortment in stock. Online shop is used exclusively for placing orders, becoming a kind of 'middleman' between the manufacturer and the customer. This means that the goods on display go directly from the distributor to the buyer.

In the case of dropshipping, the seller has no actual contact with the goods sold. He therefore has to fully delegate further activities - i.e. storage, packaging and shipping - to the distributor with whom he has signed a contract. This also means that he does not have the possibility to directly control the shipments sent to customers. It can, however, fully focus on carrying out marketing activities.

• Cross-docking

Cross-docking is a model that works on very similar principles to dropshipping. The difference, however, is that the cross-docking entrepreneur must have at least a small warehouse space. The purpose of cross-docking is to repack goods before they are sent on their way. The whole process involves receiving goods from different sources - i.e. different distributors - and then repackaging them to match the branding of the company. Once the package is packed, the parcel sets off on its way to the customer.

This solution certainly saves on storage space, but requires the owner to employ staff or spend time repacking incoming shipments himself.

Combination of several models

Depending on their e-commerce business, some entrepreneurs choose to combine several logistics models. If you have a small warehouse space, you can focus on storing small products on it, entrusting an external company to store and ship the bulky ones.

Choosing the right model is a very important aspect of doing business. Therefore, before making a decision, it is worth analysing the type of product range, the volume of orders or the location in which the company operates.