The analysis of the online retail industry in China and Hong Kong have highlighted issues pertaining to logistics that are common with the issues faced by most online retailers in the global e-tail industry. The biggest setback faced by the online retail industry is the issue of security and the low level of service quality. Both of these are driven and supported by the logistics of e-tailing. In order to ensure that the customers have a positive experience with online shopping and to increase their loyalty for repeat purchases the food and non food retailers need to set up a logistics system that is efficient, fast as well as reliable.
The logistics operations can be made more efficient by partnering with the suppliers and entering into trade agreements and relationships of service with them whereby the suppliers can provide the goods and services through a JIT method to the delivery chains and operations of the retailer as and when required. This would reduce the level of stand by inventory carried and the costs associated with it incurred by the online retailer. Additionally investments will have to be made in the packaging division whereby shock proof, water proof and sustainable materials can be used to pack the parcels to be delivered to the customers. This would ensure the safety and the integrity of the products being shipped. Aside form this the e-tailer would also have to enter into shipping agreements with its distributors to dictate the excellence in service quality and the insurance of delivery to customers in a benchmarked time limit that is promised to the customer
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