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That depends on the business initiatives, objectives, and locations
Make sure your supplier has a good reputation, updates his/her website, honor pricing on the website as listed on the day of order, delivers on time, guarantees the quality of the item, has good customer service.
Passes the background check which is done even for non online vendors... or in other words do your homework.
The evaluation of Supply Chain Strategy for online business is not much different from the one followed for traditional business. All necessary checks and evaluation techniques are the same. However, for assessing an online supplier , one should also focus on his ability to meet technological challenges in IT.
To ensure that supplier’s details like it’s reputation, the price, deliveries on time, quality of the material and having good customer service.
Agree with Mr. Nadeem Asgar, supply chain methodology for online business is more or less same as traditional method, with IT backing.
The strategy should be interactive decision making, to fulfil Seller/ Buyers requirements.
example:
My organization use Extranet as supply chain solution & the strategy we use is " interactive decision making based on inquiries/ approval". Say we want to supply -by Boat/ Air shipment, we send PTS (permission to ship) request to the client through online supply chain program providing CBM /weight / value etc.
a). Based on stock availability/ calculates risk Client may approve PTS -called Merchandise approval -with a forwarder booking & will be informed to "Nominated Freight Forwarder" stipulating time frame, CBM and a "timeline window" to handover cargo.
If failed to Handover shipment within the timeline, Forwarder request a new PTS.
b). If Client want to change mode, delivery date- PTS will be a refused, guiding us for next best Supply chain solution
Well.. I believe first we need to understand what online business really means. It is basically a virtual market where end-customer and supplier do not meet physically each other. Therefore, if you are running an online business, you do not have to have a nice store where you display all products that you are planning to sell and keep the store clean and tidy all the time and recruit adequate number of people to assist your customers. What you really need is well developed and maintained website along with strong marketing strategy to take your brand name to your targeted customer base. Since you will not spend money on running an attractive store (except a small scale warehouse where you store adequate operating stock with minimum number of employees) you can think more on how effectively you can develop relationship you have with suppliers and end-customers. Same as any other business, Pareto law is applicable for online businesses too. Therefore identifying the% of products which make% of revenue to the company is the second important task one should do after setting up a strong marketing strategy, if you are dealing with an online business. Once you have identified this% products share, you can develop the relationship you have with your top suppliers and working more closely with them. Same as the suppliers, you can identify the most important% of customer-share who make% revenue to the company and develop relationship with your loyal customers. In the meantime, it's equally important to invest money on developing more secured payment methods in your website for your customers to feel comfort whilst they make purchases.
