The Internet is changing the traditional channel through which buyers and sellers communicate. It has substantially changed manufacturing flow and distribution patterns, profoundly impacting the logistics service marketplace. Increasingly systems and services will be positioned as Internet-centric in order to optimise the availability and “distribution” of the highly complex “information” that drives the growth and development of the logistics BPO world.
Companies that fully embrace such “eLogistics” opportunities are expected to achieve substantial competitive advantages over non-IT-savvy players. eLogistics will bring traditional logistics providers opportunities as well as challenges. We have recently seen new players such as Electron Economy (now acquired by SynQuest, which subsequently merged with Viewlocity) gained an early advantage in their ability to leverage their IT capabilities to compete in the eLogistics marketplace.
Traditional logistics service providers need to catch up to retool their legacy systems quickly to meet the requirements that e-commerce firms require. 3PLs have traditionally moved products in bulk, from the factory to the warehouse to the retail outlet. In the B2B / B2C e-commerce space, this is not the case. There is a need for “back-end operations” such as order fulfilment, reverse logistics, etc. To stay in the race in the complex ecommerce logistics marketplace, 3PLs will need to focus their efforts on providing the back-end operations, demonstrate that they can provide “e-fulfilment” and the ability of react in “internet speed” — otherwise, they will not be viable as future Internet players.
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