As discussed earlier in this series ("Preparing for onboarding" and "Content tailoring"), there are many factors that contribute to selling successfully on Zalando. Each step of the process is essential, but this final installment's focus is that 'last mile of the sales journey: logistics and fulfillment.
Zalando has specific requirements for carriers, and dispatch processes need to be carefully adjusted to accommodate new processes. There is a strong business case for using Zalando's own services to accomplish this, but this depends on your business's specific situation and what fits best with your capabilities.
There are a lot of questions to consider: How do logistics work? What needs to be included with each parcel? Can you use your own carrier? Or is a third-party fulfillment a better option?
Whatever solution you opt for, make sure your logistics solution is well-organized as far in advance as possible. This will enable you to achieve the minimum standards (required by Zalando) and ensure your new customers get what they order quickly and efficiently.
There are a few different logistics options for brands selling on Zalando's marketplace. Each of these has distinct features and advantages or disadvantages, so it is vital to carefully consider which one suits your business.
An important consideration for all options is the high return rate on specific categories. This means that your logistics option should be cost-effective and efficient for returns.
Tracking is also a key feature (especially for returns). You need to ensure that your back-end systems can handle the printing of return labels (for each applicable country/carrier combination) and the tracking of these through your ERP. This is a real challenge for most ERPs (but ChannelEngine does have a solution for that). So, let's look at the options for logistics.
Image 1. Zalando Logistics options.
This is an option many retailers already use; a contract with one or more delivery companies to enable fast and reliable shipping to each European country. Be aware that there are specific requirements for each country and carrier, and the documentation will all need to be correct for each scenario.
The primary features of using own logistics are:
This is an all-inclusive service where your goods are warehoused and dispatched by a Zalando fulfillment center.
The primary features of ZFS are:
This option has the advantage of using the Zalando distribution network (preferential shipping rates, easy EU expansion) but still shipping from your warehouse. An order is sent to a Zalando location in Germany. Then, the order is sent to the customer.
The primary features of ZSS are:
Each order needs to be shipped with certain documents. These are essentially the same as what you probably already include with an order, but you may need to make some adjustments to your process.
These required documents are:
Make sure your return instructions are clear to minimize customer service requirements. As mentioned above, both the return label (and instructions) need to be tailored to each specific country. Zalando’s fulfillment and shipping services are attractive options because they unburden you of this requirement.
Image 2. Zalando shipping documents
Finally, there are specific required carriers for each country – this is pretty restricted for returns, in particular. For instance, you can ship to France using La Poste (Colissimo), UPS, Colis Privé, and La Poste (Chronopost).
However, you can only offer returns with La Poste (Colissimo) to customers in France.
This means that you need to look at your contracts carefully to determine if you are getting the best deal and maximizing your margins. As the return rates can be pretty high (an average of 45% is typical for certain fashion categories), you should consider whether the benefits of using your own warehousing and logistics services is balanced against the benefits of Zalando’s shipping options.
Image 3. Zalando required carriers
Logistics is a pretty important part of the puzzle, but you still need all the pieces to make it fit together and work smoothly for you and your customers. Zalando offers unparalleled opportunities to expand your sales horizons, but it is also one of the most challenging marketplaces to get started on. It requires a dedication to high service standards and serious attention to the details when it comes to Zalando’s own specific seller requirements.