December 16, 2004, 12:00 AM

Drop-ship performance matches warehouse service levels at QVC.com

A CommerceHub platform integrates QVC.com`s fulfillment operations with those of 200 drop-ship suppliers. Over time, average order confirmation time from outside vendors has dropped by 39% while related labor costs have been cut by 50%

QVC.com has an assortment that’s broader than what’s shown on QVC-TV, drop-shipping to customers from as many as 200 outside suppliers. Yet its drop-ship service levels match the standards in its own warehouse, improving steadily since it launched its drop-ship fulfillment operation on CommerceHub’s platform, QVC.com vice president of operations Steve Hamlin tells Internet Retailer.

Hamlin, who requires any supplier doing business with QVC.com to integrate with it on CommerceHub’s platform, says the integration provides full visibility into the fulfillment status of any order through QVC.com at any drop ship supplier. The platform functions as a universal translator that allows QVC.com to integrate with the disparate systems of outside suppliers without having to change its own legacy systems, he says.

Since QVC.com launched on CommerceHub in 1999, the average confirmation time on orders from drop-ship suppliers has dropped by 39%, while customer order cancellations for fulfillment-related issues such as late or lost orders decreased 80% to 1.1%, Hamlin says. Another key metric--a 50% reduction over that time in related manual labor costs--stems from exception-based order management available on the platform, he adds. That alerts QVC.com to take action only when order processing performance falls below pre-set, rules-based thresholds.

“Before, we had to check on every single order manually,” Hamlin says, adding that having to check only on the outliers has allowed QVC.com to reduce head count and pushed up productivity per rep by 26%. “They can handle more transactions because they just review the exceptions,” he says.

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