According to Forrester Research, one of the world's leading technology research firms, e-commerce is projected to grow from $657 billion in 2000 to over $6.7 trillion by 2004. Because e-commerce has simplified the buying process and all but eliminated the cost of switching suppliers, customers have gained the upper hand. With that in mind, online businesses are more pressed than ever before to not only figure out ways to attract new customers, but to also determine how best to maintain their current customers by exceeding their expectations. One of the key factors in providing an outstanding customer experience is the seamless execution of the fulfillment process. Today's customers are expecting their orders to be delivered on time, wherever needed, and in the manner that they designate. For companies to compete successfully, they must distinguish themselves with delivery services that are consistently superior.

Unfortunately, traditional means of fulfillment may be poorly suited to the increasingly complex methods that business-to-business e-commerce requires. E-fulfillment differentiates itself by a number of factors: Order and parcel size tend to be smaller, customer demand is highly variable and can include many last minute changes, customers' orders are subject to the variables of the situation, and shipping is dispersed over a wide range of points, varying on an order-by-order basis. In the electronic age, product flow goes both ways and companies must allot for frequent returns. With traditional fulfillment, there is generally a one-way product flow, orders have been usually large and palletized, typically filling an entire truck, customer demand was fulfilled on a supply basis measured by forecast, orders were all fulfilled the same way, shipping destinations were typically concentrated and there was generally a one-way product flow with few returns.

These days a lot of business-to-business suppliers are investing heavily in their fulfillment capabilities, many realizing in the process that the best way to succeed is by combining the web with their existing distribution infrastructure. GE Plastics, for example, allows their customers to track orders on their web site, in some cases down to the location of the delivery truck. Leaping to the aid of e-businesses, companies such as i2 Technologies Inc., Optum Inc., and Manugistics Group, Inc. have introduced solutions to provide companies with the tools they need to enhance existing fulfillment methods to meet a wide spectrum of customers' needs. In addition, a number of software packages have been introduced in the last few years that facilitate end-to-end fulfillment capabilities such as managing orders and controlling and deploying inventories.

By making customer satisfaction the guiding goal of the fulfillment process, businesses can better guarantee their place in the future of e-commerce.

Source: Value-Chain Report – Are Your Customers E-Satisfied?
Kevin P. O'Brien
IndustryWeek, Sept. 4, 2000
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