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4 Ways A Good Logistics System Can Improve Your Company’s Bottomline

SEPTEMBER 24, 2021

What do you think of when we say “logistics”? If you’re thinking about shipping, courier, delivery etc., you’re yet to realise the true potential of a good, world-class, ecommerce-grade logistics service can do for you.

Because efficient logistics can be your competitive advantage.

It can help increase sales, lower costs, improve customer experience, enhance profitability, and grow your overall business in the long-term. In this blog post, we’ll show you how.

#1 Better unit economics

Good logistics can help reduce the cost of the product itself, drastically improving unit economics. For instance, with Delhivery D2C, customers have saved money in shipping and the damages have been reduced drastically with an increased delivery speed.

This leads to tangible improvement in the gross profit margins of each product. In addition, a good logistics company can also build credibility, encouraging customers to pay for their products online instead of cash-on-delivery.

#2 Lower customer acquisition and retention cost

Most product businesses today look at logistics as the last step in their process — as something that happens after the design, manufacturing and sales. This approach misses an important thing: Customer analytics.

Knowing who is buying, what they’re buying, where they’re located, what mode of payment they choose etc. can help identify the exact customer persona to target. Businesses can use this information to inform their marketing campaigns and personalise their advertising messages.

For instance, if your gourmet coffee brand is more popular in Bangalore and Delhi, than rest of the country, you can target your Facebook campaigns towards these locations as well as young IT/start-up professionals. This increases the conversion rates, naturally reducing acquisition costs.

By extension, you can also offer products that your customers are more likely to buy, based on their past purchases. You can customise your cross-sell/upsell offers; offer targeted subscription and loyalty programs — with free shipping, for instance — for customers to buy from you regularly.

Customer analytics from your logistics solution can give you complete visibility into your sales. It can:

  • Save costs
  • Increase revenue
  • Improve the customer lifetime value

#3 Optimised Shipping Costs

A robust logistics solution will give you the analytics to optimise your shipping as well as product pricing strategy. For instance, it might cost different amounts to ship to different parts of the country. With a dashboard of location-wise shipping costs, you can make a data-driven decision whether to include it in your product pricing or charge separately.

You can also use these insights to create an intelligent pricing strategy for same-day, next-day and regular delivery options, packaging costs, warehousing and storage costs etc.

#4 Efficient returns processing and management

Online shopping gained its edge over traditional business offering no-questions-asked-returns. Today, customers have come to expect hassle-free returns. However, for the business, processing these returns can be tedious and expensive. It is here that a good logistics partner can be life-changing.

A good reverse logistics system can get the product back to the business owner faster and more cost-efficiently. For instance, Delhivery offers industry-leading Delivery Estimate Accuracy (DEA) and First Day Delivery Success (FDDS). This means that you’ll have much fewer returns as a result of the inability to find the address or the customer not being available. In addition, intelligent analytics solutions like Return to Origin (RTO) predictors can help in reducing returns.

A good logistics solution can make your returns efficient in three ways:

  • Reduce the possibility of returns in the first place
  • Minimise the cost of returns with strong reverse logistics
  • Increase sales by bringing the returned product back to you as quickly as possible

Choose Delhivery for your D2C business

Courier services offer transportation of your products from your warehouse to the customer’s doorstep. For any direct-to-consumer business, shipping and logistics with such a courier company is often an expense, an overhead, an additional expense. Delhivery D2C is designed to change that.

With Delhivery D2C, businesses can reduce the cost per unit of their products. You can reduce customer acquisition costs, engage them better and retain them longer. You can optimise shipping costs and make data-driven decisions around how to structure your product pricing. You can also handle returns with minimal impact on your operational costs.

To see how Delhivery D2C can help your business, speak to a consultant today.

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