Logistics

Moving things from where they are to where they need to be, at a cost you planned.

What it means

Logistics covers transport, warehousing, inventory, packing, delivery and returns.

Why it matters

For anyone selling physical goods, logistics is usually the second-largest cost after the goods themselves, and the part of the experience customers judge you on.

What it looks like in practice

Decide between fulfilling yourself and a third-party logistics provider on volume: 3PL adds a per-order cost and removes fixed cost and your time.\n\nPack size and weight bands drive carrier cost more than distance for most domestic parcels.

What to watch out for

Returns. The cost of a return is the outbound cost, the inbound cost, the handling and often the write-off, which is why the return rate matters as much as the conversion rate.

Where to get proper advice

A freight forwarder or 3PL for quotes, and your own cost per order calculated end to end.