Published on: 15th September 2021, Reading Time: 9 mins.
Same-day shipping, omnichannel fulfillment and always making customers happy. That’s today’s picture of the distribution logistics industry – A warehousing industry that’s driven by time pressure and operational excellence to satisfy customers’ needs. Has it always been like this?
In our in-depth interview with WMS expert Holger Meinen, and Johannes Tress, MD and Co-Founder of everstox, we explore how warehousing and fulfillment has changed over the recent years. We also review what tech-driven fulfillment centers really are, and how innovative solutions ensure serving all operational needs for commerce businesses. Let’s dive in – here’s the overview:
- 01: The New Era of Tech-driven Logistics: Interview with storelogix and everstox
- 02: Smart Warehousing and Fulfillment: Get Started
- 03: About the Co-Authors: Meet everstox and storelogix
Interview with storelogix and everstox
Commerce businesses of today face an ever-increasing challenge to keep optimizing distribution logistics in order to fulfill customers’ expectations. We’re wondering Holger, how did the logistics market look like in a time before the big eCommerce boom? Was it always so time-pressured and price-sensitive?
The logistics market as such is its own industry branch. And the optimization of processes in terms of time and price have always been relevant for businesses to achieve competitive advantages and additional service levels. Because when increasing efficiency in the seconds and cents range, you see significant time and cost savings when scaling your processes.
eCommerce has given these two factors a significant push. Constant availability, fast delivery and price-attractive products are very important in online shopping. For example, offers such as same-day delivery, free return shipping and product customization are perceived from customers as standards. And the next developments are already on the horizon to make eCommerce even better, faster and more efficient. The buzzwords here include Logistics 4.0, artificial intelligence and autonomous driving.
That’s exactly what’s key for many commerce businesses. And you already mentioned a great point: The what and how of tomorrow. Now, Johannes, you work with lots of different brands, product categories and verticals on a daily basis, what major eCommerce trends can you add to Holger’s input? And what’s your forecast on how this will impact distribution logistics?
We see three main drivers and trends within the eCommerce sphere. Starting with sustainability – more and more of our merchants actively search for green delivery and eco-friendly shipping options. At the same time, end-customers also expect Holger’s aforementioned status quo of fast delivery speed at low costs with a strong customer experience. And lastly, we also see much shorter product development cycles and the urge to quickly bring products onto the market.
From a logistics point of view, the secret sauce that fuels and empowers these three trends are going local with your operations and storing your products closer to where your customers are. Or in other words, decentralising your ops with professional partners is what really ensures delivering on these promises.
But going local and choosing multiple fulfillment providers often goes hand in hand with working with different WM-Systems. Holger can you explain why the European system landscape is so fragmented? What stands in the way of establishing a universal system for all warehouse providers? And what are the pain-points for warehouse providers when it comes to finding the right WM-System for their warehouse?
Today’s logistics system landscape is very large and intransparent. The reason behind this stems from the fact that companies often feel bound to established logistics processes and structures, and hence, look for solutions exactly for these exact use cases. This is how the market has functioned since the very beginning of IT-supported logistics processes and still does to a very large extent today. But custom-made suits only have a certain charm or a real benefit under special conditions, don’t they?
These requirements make the search for a suitable WMS very time consuming and difficult. What’s more, a lack of market transparency of Best Practices and well-implemented logistics solutions also hamper the task. Modern companies also count on flexibility for future developments and compatibility to other systems in the form of interfaces.
However, the reality shows a different picture and is difficult to realize, especially in the classic project environment. Companies are often left with the conventional project approach and the tailor-made suit. This results in the aforementioned fragmented system landscape, which contradicts my understanding of modern systems.
Talking about modern systems, everstox works with over 35 data-driven fulfillment centers across Europe and a multitude of different WM-Systems. Johannes, how do you manage to harmonize working with differing WM-Systems and why is data harmonization so important for merchants?
When working with multiple warehouse partners, the challenge is to create unified digital workflows across all warehouse locations. From a merchant’s perspective, you want to know what’s going on in all of your warehouses in order to avoid working with a black box, right? And the key here is to harmonize the heterogeneity of all these WM-Systems to easily compare and benchmark performances and work with your external logistics teams without being exposed to time-consuming repetitive tasks and inconvenient data analysis. So how does this work and what do we need for that?
First, the basis needs to sit right – or in other words, physical warehouse activities and processes need to be fully translated into digital primary data. And for that, you need modern WM-Systems across all warehouse partners.
Second, you need a smart tech solution that extracts the essential data from the differing WMS environments and then refines them into a “polished” unified data format. With this tech setup, your operations managers can easily benchmark warehouse performances across locations and communicate operational activities to various partners from one single source of truth.
Lastly, the unified warehouse information also needs to be parsed to all commerce systems in use to enable a real-time link between sales, operations and product delivery.
Holger what’s your advice for commerce businesses when looking for the right 3PLs?
Logistics is subject to enormous developments. When companies look for partners or solutions for logistics processes, they should make sure that precisely this agility is taken into account. Companies grow, have to adapt to new requirements on the market and be able to guarantee transparent and fast processes – this must also be the case when working with third-party logistics providers.
Logistics is not a static task, but a dynamic process. Joint growth, rapid response, logistics expertise and flexible adaptation are factors that I believe commerce businesses should evaluate when choosing the right partner. And, of course, a cooperative partnership should be achieved. After all, fulfillment is not a one-off service.
Johannes, what’s your perspective on how to find the best 3PLs for a business case? And what’s an absolute No-Go when it comes to warehousing providers?
Well that really depends on the actual fulfillment case in terms of product category, expected order volumes, value added services, and so forth and what’s important for you as a business. Let’s say a quick time-to-market is key to ensure being aligned with your business plan. What’s a definite No-Go here is a months-long onboarding process consisting of manual implementation and operational iteration to achieve best practice.
And as Holger also briefly mentioned, it’s not only important what a 3PL can do for you today, but rather what the cooperation brings to the table for tomorrow. Working with a 3PL should never break your commerce momentum in the long-run. If you plan to roll out new products, add new sales channels or follow any market-driven developments, your designated 3PL teams need to be capable of driving your business, not stopping it.
Adoption of new technologies across warehousing providers – what are the benefits for commerce businesses working with a modern tech-driven fulfillment center, Holger?
As Johannes has already mentioned, the digitization of physical processes is very important in order to avoid working with a “black box“. When carrying out logistical processes, an agile future-proof system, the corresponding expertise for logistical processes and a strong network are enormously important. Here again, issues such as time, money and experience play a major role.
In the best case, SaaS solutions such as everstox and storelogix are involved. Because these systems offer extremely high flexibility and cost control in fulfillment including expert team and professional processes. In addition, such systems provide important data that ensures efficient, system-supported and valid process mapping.
How did storelogix get in touch with us? What’s your experience with the everstox solution? And how do you see their solution fit with the current market dynamics / how does it solve the aforementioned pain points?
The first contact with everstox came through a long-standing fulfillment customer in 2019. A new client used everstox as a solution and we exchanged ideas as the respective service providers regarding interfaces. From the initial contact, a good partnership developed. More and more of our clients are working with everstox.
The joint exchange on logistical processes, possible IT solutions and optimization possibilities is always encouraged. This is exactly what contributes to solutions of current market dynamics. We, with our SaaS solutions and our partner networks, offer products and expert teams that are digital and future-proof. Solutions like everstox and storelogix not only solve today’s business needs, but also provide you with security and room to maneuver through future processes.
And here again the full circle closes: Logistics and fulfillment will continue to change – and we have products that evolve with agility and provide a flexible solution that supports any future developments.
The discussion with storelogix and everstox sheds light on the current dynamics of the distribution logistics market. eCommerce is a fast-paced industry, and brings a lot of challenges with it. But rest assured, you’re not left alone when navigating through all operational hurdles – working with a strong tech-driven basis and the right service partners paves the way for your business success.
If you want to learn more about modern WMS solutions, contact our partner storelogix. If you require support to find the best 3PLs for your business case and work with an agile distribution logistics software to manage multiple locations with one single source of truth, simply contact our team and get started.
If you like this in-depth interview about the tech-driven logistics landscape, you may be interested in other warehousing and fulfillment topics such as our logistics costs breakdown or how to find the best 3PLS across Europe:
- [3PL Guide] How to find the Best Fulfillment Providers?
- [Green Logistics] How to reduce CO2-Emissions?
- [Cost Analysis] Logistics Costs: The 5 Main Cost Drivers
Meet the Co-Authors:
Max and the marketing team at everstox take care of researching, evaluating and writing all logistics insights that we gather from our day-to-day operations. If you have any questions on our thought-led articles, guide’s or any other blog-related topic, feel free to get in touch with our team.
Head of Marketing
At everstox, Johannes is responsible for the Logistics Partner Network and implementing Logistics Operations for our merchants. Johannes previously founded and bootstrapped space-y, a startup for modern workspaces and is a former BCG consultant.
MD and Co-Founder
Meet the Co-Author:
Holger Meinen is Managing Director of the Bochum-based IT service provider common solutions. There he is mainly responsible for the warehouse management system storelogix.
storelogix is the all-in-one solution for warehouse management from common solutions KG. The warehouse management system (WMS) is operated in the company’s own data centers in Bochum, Germany and offers absolute flexibility, cost control and future viability through their SaaS model.
Holger Meinen is Managing Director at common solutions (storelogix) with a background in intralogistics for more than 20 years. Initially working as a logistics consultant, the experienced entrepreneur later spent most of his time in management positions playing a key role in the further development of industries and customers in the WMS and automation world.