Today’s organizations need flexible solutions to grow and adapt in dynamic market conditions. Six out of 10 top retailers and brands use programmatic logistics to optimize their networks, reduce costs, and increase revenue.
Key Takeaways
- Flexe customers see 119% ROI over 3 years
- Increased e-commerce revenue by 20%
- Warehousing cost savings of $9.8M
- Reduced warehousing operations cost by 12%
- As needed capacity savings of $5.1M
- Reduced last mile transportation costs by 10%
Consumer demands for fast eCommerce delivery and buy online/pick up in-store (BOPIS) are increasing dramatically. As a result, retailers and brands recognize the need to rethink their current logistics frameworks. They must look for ways to optimize and expand their networks to reach end customers as quickly and efficiently as possible. Many turn to Programmatic Logistics.
Programmatic logistics helps organizations solve specific, omnichannel challenges. Unlike traditional solutions, Programmatic Logistics allows organizations to move fast, at scale, and with the precision required to solve the world’s most complex omnichannel logistics problems.
The Economic Impact of Programmatic Logistics #
Flexe commissioned Forrester Consulting to conduct a Total Economic Impact (TEI) study that examines the impact Programmatic Logistics has on enterprise organizations.
Increase ROI #
Using programmatic logistics, Flexe customers can dynamically adjust distribution and fulfillment networks to meet the needs of changing markets. By reducing inventory replenishment times and optimizing for shorter delivery, Flexe customers realize a 119% ROI over the course of three years.
With an average payback period of six months, organizations see results almost immediately.
Increase revenue #
There is growing pressure to provide faster shipping options for online shoppers. Top retailers require logistics solutions that deliver fast shipping without increasing operational costs. Because of the inherent flexibility of Programmatic Logistics, Flexe customers can launch new distribution centers closer to end customers quickly and reduce delivery time—from order processing to final-mile delivery—to two days. Faster shipping options lead to lower cart- abandonment rates, increasing annual eCommerce sales by 20% on average.
About a year after engaging with Flexe, we saw a 15% drop in cart abandonment and a 20% increase in eCommerce sales. We wholly attribute this to our delivery speed dropping to less than 3 days anywhere in the country. Our new [fulfillment] hubs have greatly contributed to this improvement.
Reduce costs #
Traditional warehousing solutions typically require huge upfront costs and have fixed capacity and term agreements that don’t easily adapt to rapid market changes. Rigid terms and contracts often leave organizations with wasted space and inflated operational costs. A programmatic approach to logistics optimizes for attributes like warehouse specifications, charges, and location, making it possible for retailers and brands to launch the nodes that are exactly right for their needs.
Flexe customers see an average reduction in warehouse operations costs by 12% and realize an average $9.8 million savings by consolidating warehouse contracts.
The flexibility of Programmatic Logistics also allows organizations to quickly add strategic fulfillment and distribution centers closer to end customers, improving delivery times and reducing last-mile transportation costs by 10%. And, organizations use warehouse capacity as-needed, reducing capacity costs by an average of $5.1 million.
Fixed vs variable costs #
In addition to the quantifiable cost savings and revenue increase, businesses using Flexe experience benefits across the organization. Because Flexe customers use an existing network of fulfillment and distribution partners, there are no high, upfront capital costs, fixed leases, or long-term warehouse contracts. Customers save costs by paying only for the services they use, when they use them.
Before Flexe, we had a lot of unanticipated costs associated with our distribution operations.
Without fixed locations, costs, or capacity, Flexe Logistics Programs provide the ultimate adaptability.
We use Flexe a lot for overstock. Our business is highly seasonal, and we don’t need all our space all of the time. When we need capacity, we turn to Flexe because we can use space in multiple warehouses in multiple regions for as long as we need to manage inventory surges.
Single-platform network management #
With Flexe, organizations streamline network management and consolidate applications. Customers manage multiple warehouses through the Flexe Logistics Platform. The single integration provides visibility that eliminates wasted space and extra costs, while also expediting the time it takes to stand up a new facility.
Flexe provides the WMS technology. I could have more than one Flexe warehouse and still use the same software to manage them all.
Speed to launch #
Organizations looking for an edge on delivery time or that are expanding into new territories must open new distribution centers quickly. With Flexe, retailers and brands don’t have to worry about breaking ground or breaking the bank with upfront costs. Because all of Flexe's warehouse partners use the Flexe Logistics Platform, getting new locations up and running happens in a matter of weeks, not months.
Once I integrate with the Flexe Logistics Platform, I can get a new location up and running in two to four weeks.
The Power of a Programmatic Approach #
Programmatic logistics contains four main components:
Logistics programs are transactionally priced services that solve discrete omnichannel logistics challenges that retailers and brands face every day, which many customers run concurrently for a multi-program approach that addresses multiple needs.
Networks of independent warehouse and transportation partners integrated through a shared platform and central deal exchange.
Technology that centralizes the distributed execution, management, and measurement of Flexe Logistics Programs. It unifies multiple warehouse providers in the Flexe network to accelerate speed to market.
Optimization of network nodes, warehouse management, order management, inventory placement, and delivery promises to achieve efficient and customer-centric omnichannel execution.
It’s time to start taking a programmatic approach to logistics. Flexe is the leading Programmatic Logistics solution for the Fortune 500 and brings deep logistics expertise to solve the most complex supply chain problems.
About the study
This report is a Total Economic Impact (TEI) Study—a methodology developed by Forrester Consulting to serve as a foundational framework for organizations making investment decisions. TEI provides a cost and benefit analysis framework that consists of four components to evaluate investment value: benefits, costs, risks and flexibility. These can help decision makers justify their initiatives to other key stakeholders within their organizations. For the purpose of this study, Forrester Consulting interviewed a set of 4 Flexe customers and interviewed several Flexe leadership team members to understand the Flexe value proposition.
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