Due to internet accessibility, skyrocketing consumer confidence, and an increasing preference for online buying, E-commerce has become increasingly popular in the Gulf Cooperation Council, or GCC countries. The online platform has expanded its scope and revamped its patterns or processes to accommodate user preferences. With the surge in sales across numerous channels, a large space or multi-warehouse is required to stock the goods effectively.
However, despite the expansion of e-commerce, businesses still need to overcome several logistical difficulties. In this post, we’ll look at four major logistics challenges that GCC e-commerce companies face and how the best courier shipping service in UAE, like Arak Delivery Services, solves them.
Challenge 1: First-Mile Pickup
Many online retailers complain about difficulty picking up products from SMEs(small to medium-sized). This is because the GCC market is built around shopping malls, and SMEs prefer to sell their goods in-store rather than online.
A study found that only 36% of SMEs in the UAE had made an investment in an online channel to support their brick-and-mortar operations. Only 4% of people intend to sell online in the future. This means that a smaller selection of products is available online because product pickup is typically limited to big brands and huge corporations.
E-commerce businesses should locate their pickup centers as close as possible to collections of SMEs and other suppliers—in a nutshell, centers close to shopping malls will help in overcoming first-mile pickup and shorten collecting and processing periods.
Challenge 2: Last-Mile Delivery
Although most oil-rich Middle Eastern nations have modern infrastructures, there is still a long way to go before the region’s economies can be said to be on par with those of more industrialized nations. Unexpected variations exist in local and regional logistics. However, working with a trusted delivery partner that is technology-driven, like Arak Delivery Services, is an efficient approach to handling the issues of e-commerce logistics for last-mile delivery in the Middle East.
Challenge 3: Cash on Delivery and Payment
In the GCC, cash-on-delivery (COD) is still a common payment option because of cultural customs and worries about online security. However, COD presents particular difficulties for e-commerce companies, including the possibility of non-payment, elevated operating costs, and the requirement for effective cash collection procedures. E-commerce companies can overcome these difficulties by expanding their selection of payment methods, putting in place secure online payment gateways, and collaborating with renowned payment service providers to give adaptable payment options.
Challenge 4: Reverse Logistics and Returned Goods
For e-commerce companies in the GCC, reverse logistics and returns administration are major obstacles. Consumers now anticipate easy return procedures, yet coordinating returns across borders can be difficult and expensive. Businesses may manage reverse logistics more efficiently and boost customer satisfaction by putting in place a strong returns management system, streamlining the procedure, and working with regional service providers to handle returns.
Challenge 4: The warehouse space
The worst thing about warehousing is that, while having enough room, you can’t really use it. There is a significant difference between managing a single warehouse and managing multiple warehouses. More employees are needed to follow the inventory and warehouse management procedure due to the multi-warehouse space that actually costs more.
In order to address warehouse management difficulties, a comprehensive, interconnected and strong framework must be created. Also, a virtual feature plays an authentic part in putting things in the right manner without difficulty.
In a nutshell, despite the above-mentioned logistic challenges, the future of the online retail market in the GCC is still bright and shining. However, if you’re looking for an effective solution for your online retail operation, Arak Delivery Services has a team of experts to assist you with shipping and e-commerce integration problems. We can help you to increase your part of the GCC e-commerce industry by providing Express courier shipping services in Dubai and dealing with other logistical difficulties in e-commerce.