Friday, December 10, 2010

Quick Primer: What is SEO and Why It Matters to Logistics Companies

Frankly stated, SEO, or Search Engine Optimization is the process of getting your companies website found when people search for certain terms on Google (or any other search engine like Bing or Yahoo).

As an example, if you are a third party logistics company that specializes in frozen food service distribution, then you want your name to appear in Google's Search Engine Results Page (SERP) when customers are looking for the type of services your company offers. SEO is the process of creating and positioning your site to rank well on Google's search pages - organically. If someone goes to Google and searches on "frozen food logistics" you want to be the first company that potential customer sees on the page.

You will notice there are other listings at the very top and right margin of the Google results pages. Those are ads that company's pay for to be located in those areas. Each time someone clicks on one of those links it is costing the company $.50 to several dollars for the privilege of a user clicking on their link. Organic search like we are talking about here is the process of getting your site to rank high on the page without paying any of Google's pay per click fees.

So what is Google looking for to rank your company highly as a logistics software company, or as an ecommerce order fulfillment provider? There are two main things: relevant content on the site related to the search terms and site credibility, which means there are other sites with "backlinks" to your site. Backlinks are a type of "social proof" that other website are linking to your website because it is credible and worthy.

So what to do? Figure out what "keywords" your customers are typing into Google that relate to what services you are selling and add related content to your site in the form of blog posts or new pages that will show Google you have authority on those topics. Then, work to get backlinks to your website from other credible websites. This can be done by responding to blog and forum posts and getting your website address out there. Both these strategies are complimented by a well executed social media strategy.

These two ideas are just barely scratching the surface of ways to improve SEO for your site. The benefits of ranking well with Google are almost priceless, yet easy to achieve when executed properly.

Thursday, December 2, 2010

Cost Components of Order Fulfillment

One of the largest expenses for any business that sells products online is the cost for order fulfillment. In total, the order fulfillment process includes the storage, packing, and shipment of customer orders that come through an online store. These costs are beyond the expense of sourcing and purchasing the products being sold (regardless of what the business might be selling) plus all the marketing and other various cost of sales type expenses. Taken all together, this long list of different cost items have to be managed effectively for a business to maintain an acceptable profit margin. It goes without saying, a positive profit margin is vital to the viability and success of an ecommerce retailer. Fortunately, making the right decisions regarding the storing, packaging, and shipping costs are likely the easiest on the list to impact for the better.

Below is a list of the three primary cost considerations for ecommerce retailers when it comes to packing and shipping customer orders.
  • Packing Supplies. These costs include the dunnage (or packing material) to fill in and around to protect the product, as well as the cost for the cardboard carton the goods are placed into. Basic shipping supplies and cartons from UPS, FedEx, and USPS are free, as is the logistics software they will provide - so that is one thing to take advantage of when you can. Of course shipping a lot of empty space in a bad fitting carton is a poor choice for a number of reasons. Your business may also prefer to brand packaging with a company logo and not a big UPS label! The additional cost of customized packaging has to be considered.
  • Direct Shipment Costs. The choice of who ships the order (whether it is USPS, UPS, Fed Ex) and at what service level (Ground, Next Day Air, etc.) impact costs often more than any other single item. Shipping Ground Service instead of Next Day Air can often save over 2/3 off the shipping cost. Of course it can also add 4 or more days on to the delivery time. Volume means a lot when it comes to shipping with FedEx and UPS, so make sure your contract stipulates that discounts on shipping will kick in once you hit certain volume thresholds. There is a "hybrid" option in which a shipping company (such as FedEx or DHL Globalmail, or various others) acts as a mail integration partner. These companies will pick the packages up on their own trucks but then move the parcels to the USPS who make the final delivery to the consumer. This set up works only in a business to consumer model and generally requires a minimum daily amount of parcels (typically 250 per day).
  • TIME. Is packing up customer orders in cartons, maintaining space for storage, and printing shipping labels the best use of your time? As a small business owner you should be asking yourself constantly throughout the day - Is what I am doing right now helping to make my business more successful? Managing your social media logistics presence, marketing, or selling are all important priorities. Chances are you could make better use of your time than doing your own order fulfillment.

New LinkedIn Group: Social Media for Logistics

We have created a new group on LinkedIn called Social Media for Logistics.

The Social Media for Logistics Group is a forum for individuals to share and discuss their experiences with Social Media as it relates to supply chain logistics.

Our goal is to build the group forum into a reference resource with examples and advice on how to use Twitter, LinkedIn, Facebook, blogs, and other social media platforms.

Members include thought leaders from 3rd Party Logistics Companies, Supply Chain Professionals, Carriers, Shippers, Manufacturers, Marketing, Logistics/ Transportation Management Software providers, and Order Fulfillment, as well as Supply Chain Industry Researchers and Publications.

Please visit LinkedIn and join in on the conversation.

Social Media for Logistics Blog