With the development of e-commerce, many people know that a very important competitiveness of enterprises lies in the supply chain, but what is the supply chain? Most articles on the Internet talk about some concepts, which makes it difficult for practitioners to implement them. This paper will talk about the understanding of e-commerce supply chain based on the author’s own experience, and welcome all interested parties to exchange and learn together.

Baidu Encyclopedia tells us: "Around the core enterprises, through the control of information flow, logistics and capital flow, starting from purchasing raw materials, intermediate products and final products are made, and finally the products are delivered to consumers by the sales network. It is a functional network chain model that connects suppliers, manufacturers, distributors, retailers and end users as a whole. "

Simply put, it is the process of goods from [supplier] to [seller] to [demander]. Of course, there are many roles involved in this process, and these roles are interrelated and form a complex network model. An enterprise may play multiple roles in both supplier and seller, so the chain of supply chain will be shortened. Logistics, from [supplier] to [demander]; Capital flow from [demand side] to [supply side]; Information flow, various roles pass each other.

What is a good supply chain? My understanding is: better goods (quality and price), faster transportation, better service and better cost.

Most of the articles on the internet now make you feel particularly reasonable, as mentioned above, but after reading them, I still don’t know how to apply them to my products.

The design of e-commerce supply chain, the most important thing is based on business. There are many types of e-commerce business. Here, I will talk about my own understanding only for the most common business. There are many ways to classify e-commerce business. Here, we will explain e-commerce business from the perspective of commodity source, commodity sales and warehousing and distribution.

Source of goods: self-production, self-mining, investment promotion, etc. Self-production means that goods are produced by themselves, such as herbs; Self-mining refers to purchasing goods from suppliers, such as most of the goods of Netease koala; Merchants, merchants enter the platform for sale, such as Tmall.

Commodity sale: own platform, third-party platform, wholesale, etc. Own platform, refers to the development of their own platform to sell goods, such as Gegejia; Third-party platforms refer to opening stores for sale on third-party platforms, such as Tmall and JD.COM; Wholesale, the downstream of this business does not actually reach the consumer, and it may reach the consumer through other sellers many times, so it is listed separately, such as dolphin supply chain.

Warehouse delivery: Do you build your own warehouse and deliver the goods yourself?

Of course, most companies include the above businesses, such as Netease koala, and the sources of goods include self-mining and merchants’ settlement; Commodity sales include self-owned platforms and third-party platforms; Warehouse delivery, including self-built warehouses and cooperative warehouses, is the responsibility of third-party companies.

Let’s assume that the e-commerce business is as follows

Source of goods: self-mining;

Commodity sales: own platform;

Warehouse delivery: self-built warehouse, third-party company delivery.

Then the positive process of e-commerce supply chain products is roughly as follows:

1. The supplier is the supplier, and the goods are originally in the supplier’s place;
2. Enterprise system (ERP) establishes purchase orders through purchase plans, and collects goods from suppliers into its own warehouses;
3. The warehouse system (WMS) manages the inventory of goods in the warehouse system through transport documents/receipt documents, associated purchase orders, or other warehousing methods;
4. After the enterprise system (ERP) obtains the commodity information and inventory information, it transmits the commodity information to consumers through its own platform for commodity sales.
5. After receiving the order information, the order system (OMS) processes the order (customer review, financial review, warehouse selection, opening and closing, etc.) and monitors the order. After the order is processed, push the order information to the corresponding warehouse; (The most direct experience of users to e-commerce enterprises is logistics, so the processing and monitoring of orders directly affect the user experience, including the "full link of orders" proposed by Tmall, which aims to improve the user experience here)
6. After receiving the order information, WMS performs operations such as billing, sorting, inspection and delivery, and delivers the order to a third-party courier company for distribution.
7. Goods reach consumers through express delivery.

There are several systems involved here. Let me explain the terms first:

• ERPEnterprise Resource Planning, which mainly refers to the internal systems of the company, including procurement management, commodity management, marketing management, CRM, after-sales work order management, financial management, employee management, etc.
• WMS: Warehouse Management System, which mainly refers to the system used inside the warehouse, including the management of warehousing, warehouse distribution and delivery (billing, picking, inspection, delivery, etc.).
• OMS: Order Management System, which mainly refers to the operation and monitoring of orders, such as customer orders, financial review, warehouse selection, opening and closing orders, etc. Monitor and deal with all kinds of timeliness and anomalies of orders. OMS is also a part of ERP system conceptually. Because it is particularly important in the supply chain system, it is listed separately here.

Another common type of e-commerce business

Source of goods: merchants settle in;

Commodity sales: own platform;

Warehouse delivery: there is no self-built warehouse, and the third party company delivers the goods.

Then the positive process of e-commerce supply chain products is roughly as follows:

1. As the supplier, the settled merchants initially have the goods there;
2. The settled merchants release commodity information and manage commodity inventory through the merchant background system;
3. Enterprise system (ERP) examines the commodity information of merchants, and manages and sells the commodities of merchants;
4. After receiving the order information, the order system (OMS) processes the order (such as customer review, financial review, merchant selection, order splitting and order merging) and monitors the order. After the order is processed, push the order information to the corresponding merchant;
5. The settled merchants get the order information through the merchant background system, and operate and deliver the order;
6. Goods reach consumers.

An excellent e-commerce supply chain not only means that we can get good goods (quality and price) offline, but also requires the close and efficient cooperation of all the roles on the chain (suppliers, sellers, warehouses, etc.) and various online systems (ERP, OMS, WMS, TMS, merchant systems) in order to achieve faster distribution, better service and better cost. This should be the core of e-commerce enterprises.

E-commerce supply chain system is a complicated system. Today is the first day of 2017. Let’s write a big framework first, and strive to improve each part step by step this year. Welcome interested friends to communicate!

　

Author: nonsense, micro-signal: wangboforeversmile

This article was originally published by @ nonsense. Everyone is a product manager. Reprinting is prohibited without permission.