Web retailers pick UPS for supply chain management

Two European online retailers have turned to supply chain management specialist, UPS Worldwide Logistics (WWL), to help manage their Internet inventory and order management systems.

UPS WWL - a subsidiary of distribution giant UPS - will handle orders for fashion site boo.com, in North America, including supplier shipments, order fulfillment, returns processing and gift wrapping.

The company will also handle order management for German retailer First Online-Shopping's software site at http://www.software-laden.de .

A spokeswoman for UPS WWL said the company has been developing specific order processing systems for the ecommerce market. "There are different characteristics for ecommerce companies versus high-street retailers. Generally you are dealing with smaller shipments to a lot more destinations, and there tends to be a higher returns rate."

She said the company saw an influx of enquiries from online retailers before Christmas last year. "Suddenly orders were skyrocketing and retailers realised they had to do something about it," she said.

According to UPS WWL, it has been working with selected customers to learn about different ecommerce business models. The company has been developing it own supply chain software in-house which is able to cope with the demands of Web enablement and rapid growth.

"Right now ecommerce companies are less the 10 per cent of our business," added the spokeswoman, "but the market has huge potential."