Fast delivery or wide offers: Get to know your online retailer

You log on with much excitement to check out the daily deal on your oft-visited e-commerce site. You manage to add your item to cart, make the payment and also receive that debit message from your bank-all of this before someone else takes away that last piece of the shirt.

Then, you realise that the battle is only half won. Your wait for your purchase to arrive is like waiting for Godot. Your hopes and your money are doing the tightrope walk between refund and the courier man ringing the doorbell.

[caption id=“attachment_624989” align=“alignleft” width=“380”] There are predominantly two supply chain models, e-commerce companies in India adopt. Reuters[/caption]

This might continue to be the state of affairs for a while unless the companies decide to drastically change their supply chain model. But for now, here’s to tell you how this works.

There are predominantly two supply chain models, e-commerce companies in India adopt. One is the inventory model (think Flipkart) where the company purchases and stores the inventory-which means that the items you see on the site are the items that the company stores in its warehouses. So, once you make the purchase, depending on where you live, delivery doesn’t take very long. (Flipkart on special requests even delivers the item on the same day, depending on availability.) A global equivalent of this would be Amazon.

The other model is called the ‘Dropship’ model where the company is either a marketplace (think eBay or Junglee) where buyers meet sellers or the site is basically a price-comparison engine. Or, flash sales site like FashionandYou or 99labels. These sites do not have inventories. They merely connect sellers with buyers. In case of the flash sites, they mostly work on open purchase orders, where once you make the payment for the product, the company then sources the item from the seller and then ships it. This process takes long, sometimes even a month. And even after the long wait, sometimes, the user has to compromise because the exact same item isn’t available or was rejected in quality control. In this model, the seller is often only given a commitment so if the seller has a better offer, nothing stops them from accepting it.

These are quick tips for you to judge how fast your product will be delivered.

• Check the delivery timelines. Flash sites mention the timeline -2-3 weeks.

• If the site has different merchandise everyday or very often, that’s an indication that they are a daily deal site and delivery will take time.

• Unless these deal sites mention express delivery, the timelines are bound to vary.

If one were to review these models from the company’s point of view, K Vaitheeswaran, founder of Indiaplaza.com believes that in the dropship model, the overhead costs incurred are much lesser because the company does not have to store the inventory. This also lets the company offer better discounts and have a wider selection of items. "

Indiaplaza follows this model, like eBay and unlike the first model, we are not controlled by inventory. While, there is no shipping guarantee, the advantage is that the selection we offer is huge," he said.

E-commerce companies, no matter what model they follow are constantly making changes to it. Flipkart is developing its own delivery mechanism, for instance. " Companies cannot afford to let customer satisfaction take a hit. Sites like FashionandYou have started partially storing some items. They have to innovate or they will be forced to sell out to a player who does it efficiently," said Prashanth Mohanachandran, founder, CEO of Agency Digi, a Mumbai-based digital ad agency which works with e-commerce companies.

(Firstpost is part of Network18, which also owns the online & on-air retail wholesale and distribution venture HomeShop18)