The Influence On Internet and Logistics In the 21st century, the internet has become a part of everyday life. Not only for social purposes, but for business purposes, too! In this paper we will be discussing how the internet has influenced the logistics world; when it comes to online retailing, on-demand software, and e-procurement. The first influence on logistics and the internet is online retailing. When looking at online retailing, we will also be looking at in-store retailing for they have similar logistical similarities, as well as differences.
Similar logistical functions and activities for online retailing and in-store retailing re transportation, warehousing, material handling and order management. Along with equipment and materials they both use bar coding and wimp’s. Some companies prefer online retailing. There are more smaller orders, order management and information management systems must handle large volumes of orders, smaller orders dictate open-case picking, packaging is done in small quantities, the same transportation companies are used all the time.
When companies use online retailing return rates seem to be higher, which is at a 30% rate. While some companies prefer online retaining, there are still some companies hat use in-store retailing. With in-store retailing there are fewer larger orders, order management system is set up to handle orders from resellers, not consumers, instead of open-case picking, they use full-case picking, and they can also handle large volume orders. Packages hold large volume orders, transportation methods and companies are not always the same, and it depends on the buyer.
Also, in-store retail returns are actually lower than on-line returns, which range at about a 10% rate. The second influence on logistics and the internet is on-demand software. Since the beginning of the twenty-first century on-demand software has grown, and more and more companies are using the on-demand software. The top 5 advantages companies are using on-demand software are (1) Lower Cost of Ownership (2) Fast, Simple Implementations (3) Anywhere Access (4) Automatic Upgrades, and (5) Advanced Data Security.
On -demand software is really easy to use for companies. When using the on- demand software model, it is a simple process. The company who owns the software is responsible for managing and supporting that specific application. The software our company purchased is run on a secured server by the vendor, and the company using it access’s it via the internet. Although, on-demand software is easy and appealing to use for companies, it is not meant for all companies to use.
There are 3 primary reasons (1) Regular software upgrades (2) On-demand software doesn’t let companies customize the software to better fit their companies needs, and (3) Some companies still have issues with trusting security and data protection. The third intelligence on logistics and the internet is e-procurement t . I is also known as electronic procurement. It is a purchasing system that companies use to receive services and goods. Companies like using e-procurement because they get their stuff at a faster rate and is less costly to them.
E-procurement is solely internet based and automated. There are many benefits for using e-procurement. There are lower costs, better visibility, enhanced productivity, and better control for companies that use e- procurement. Along with benefits of using e-procurement, there are drawbacks for companies using the e-procurement process. The main concern is the security of information in the way it’s transmitted. Some other drawbacks include system errors in orders, software and systems don’t meet companies’ needs, and potential change in supplies or available goods.
In a recent study on e-procurement only about 25% of companies who use electronic procurement use this purchasing system. In the same study it was found the companies and their employees do not have the skills and knowledge to use this system correctly. A popular activity that is influenced by electronic procurement is reverse auctions. When companies or organizations use reverse auctions to offer the lowest price of a reduce or service, they want to or intend to provide the other company or organization.
There are some pros and cons for using reverse actions. The pros are it reduces costs, it saves time, there are new suppliers, and versatility is involved. Some con’s involved with reverse auctions are the buyers maybe to focused on getting the lowest bid, instead of focusing on how good the company actually is. There are also, no guarantees. With having no guarantees, the buyer may use the lowest bid to get what they need. However, each time they do this, they may not be looking at vendors or suppliers that would give them that price all the time.