Distribution Meshes and Multichannel
Every company that aims to expand its brand and products needs to know how distribution networks and multichannel work.
What would cities be without a good road system, which allows the constant flow of vehicles in all directions? The answer is simple: every day we would face chaos. Even with good projects and billionaire investments, drivers often face traffic jams in urban areas. Therefore, constant planning is necessary. The distribution network used by logistics operators is no different. In a simple way, we can define this expression as the set of routes and physical spaces used intermodally (or not) to take the product from the manufacturer to the consumer.
Easy? No way. Cheap? No way. We are talking about suppliers of raw materials, factories and stores (physical and online) interconnected by drones, motorcycles, cars, trucks, trains, planes and ships that use ports, airports, bus terminals, railway stations, distribution centers (strategically located in different regions), in addition to their smaller versions, such as dark stores (which have become a trend in the pandemic) and smart lockers (smart lockers where the customer picks up the product himself), in addition to other alternatives.
Creating a good distribution network is essential for speedy delivery and also for reducing costs. See the example given by the Logweb site : “To express the complexity of this problem, let’s exemplify a configuration of a simplified logistics chain: imagine that you had to choose the best logistics network considering that your company has 1 supplier abroad, 3 alternative ports and 3 airports for importing cargo, 4 alternative DCs for batch deconsolidation and only 1 customer in Brazil. This simplified configuration results in 24 possible routes (4x (3+3)) for shipping your product.” Oh! And as our country has continental dimensions, with different taxes in each state, in addition to the most rational route, it is also necessary to evaluate the tax cost of the route taken. It was the tax issue, for example, that led Sephora, a perfume and cosmetics company, to set up a distribution center in the Midwest region, more precisely in the state of Tocantins. If we supercharge this equation with multiple suppliers and customers, we’re talking about millions of shipping possibilities. Calculation that can only be performed with speed and efficiency by excellent software, such is the complexity of the equation.
That is why investment in distribution centers needs to be well evaluated, as they are structures that consume reasonable financial energy. And even after the allocation of resources, it is necessary to be attentive to the moods of the market, which can force a review of the network installed in the company’s logistics operation. Simply put, planning needs to be constant. In addition to commercial fluctuations, there are some situations that force a new analysis of resources and routes, such as the purchase of other companies or possible mergers, which allow the optimization of structures, commercial expansions or a temporary retraction, in addition to changing suppliers, implementation of a more efficient modal or even extraordinary events, such as a pandemic…
According to the site Montello there are several advantages in the periodic analysis of the distribution network. For example:
- “ Increased level of service;
- Reduction of the freight bill;
- Decrease in tax expenses;
- Elimination or opening of plants and DCs (both options can be advantageous);
- Minimization of inventory levels;
- Full Mesh Balancing.”
But this review requires some care. Evaluate your current network well, organize your database (mainly the costs), analyze the possible alternatives and monitor the results of the change (after all, everyone makes mistakes).
There is another factor that may require adaptations in the distribution network. It is multichannel, that is, the company’s ability to maintain contact with its customer through different channels, sometimes simultaneously. Since 2020, with the new coronavirus, this contact has been intensified, mainly in a virtual way. This amplified disclosure usually gives positive results in sales, forcing the retailer to seek the best possible strategy so as not to disappoint his consumer when it comes to delivering the goods.
To have a multichannel company, the interested entrepreneur must pay attention to some details. According to journalist Mayara Azevedo, in an article published by the Ecommercebrasil website, the Marketing Department must, among other things:
- Study the target audience. You have to know the customer. Know your age group, geographic profile, group of interests;
- Integrate the different channels. After choosing the means of communication, they must be strategically integrated. It is not a single text on different platforms, but content duly adapted to each channel.
- Maintain the visual identity. Even if they are different products in each medium, it is necessary for the consumer to recognize the company behind the action.
- Produce relevant content. Without consistent contributions, the multichannel strategy becomes null.
- And guarantee the quality of the product or service. It is not enough to attract the customer. It is necessary to deliver what was promised, in the way that was promised. Every broken promise breeds disappointment. And that kind of disappointment does considerable damage.
In the same article, journalist Mayara Azevedo, who also works with Corporate Marketing, said that the multichannel strategy offers six unquestionable advantages:
- Greater presence of the brand, which reaches the customer through different means;
- Increased credibility, as the more the brand is known, the greater the respect of the public;
- Reflection in the conversion rate. After all, multiple messages increase the possibility of sales;
- Increased knowledge of your customers. Digital tools allow for a more accurate mapping of the public’s consumption habits;
- Ease of receiving feedback. The multi-channel strategy enables this in three ways:
- leaving an open channel for active communication by the public;
- redirecting customers to feedback forms and the like;
- offering alternative means of gathering feedback.
- And finally, good chances of loyalty.
Due to the growth of virtual sales, multichannel has been accentuated in recent months and this has overloaded companies’ distribution networks. After a year of the pandemic, there has already been an adaptation process, but there is still plenty of room for new business with Águia Sistemas in the logistics sector. Chat with us.