Six eFulfilment models
The facilities, equipment, and other physical needs of
eFulfilment operations are the easiest to acquire and use. It is
information systems which require internal and external
integration and the recruitment and training of the workforce
that are most difficult to do quickly and well. This is actually
the main reason for outsourcing eFulfilment operations to a third-party.
The evolution of e-commerce is affecting many of the basic
trade relationships among supply chain partners. For example,
third-party outsourcing arrangements tend to involve complex
packages of services provided by one service company.
Warehousing, picking, shipping, information systems support,
labour provision and management are all provided under one long-term
But increasingly, these services are available separately. For
example, Celarix, Inc. offers a global package tracking service
for a monthly fee. Some software vendors are considering making
things like warehouse management, procurement management and
similar supply chain applications available on a subscription or
per transaction basis. This virtualisation of basic business
processes increases the number of options —and potential
complexity— for a company’s supply chain.
Virtualisation and fragmentation is also likely to extend to the
services suppliers offer their customers. Overall,
increasing options is good for service buyers and will put price
pressure on providers. Consumers will ultimately benefit.
Preparing for an eFulfilment future
An important point for companies to consider is how the
flexibility and performance of their fulfillment process fits
into its overall business strategy. Components of an effective e-commerce
strategy include product offering, marketing approach, web site
design and last but not least, eFulfillment. Getting the help of
partners who have done it before could be valuable especially in
such a new and rapidly changing venture. Making the right
eFulfilment choices at the start makes a world of difference to
Alister Danks is a manager with Andersen Consulting’s
Strategy competency group, specialising in Supply Chain
Management. Robert E. Mann is an associate partner in the
Andersen Consulting Supply Chain Practice.