A track and trace system helps ecommerce companies track orders throughout the supply chain until they reach the end consumer. Customers can also use track and trace information to follow their purchase along its delivery route. Find out how an effective track and trace system improves transparency—an especially important consideration for direct-to-consumer brands.
What is track and trace shipping?
Track and trace shipping, also referred to as tracking and tracing, allows ecommerce companies to determine the current and past locations of inventory throughout the supply chain. The goal of track and trace is to provide full visibility of an item's location and status throughout the ecommerce fulfillment process.
For most consumer-oriented track and trace systems, companies use barcoding and scanners in order to constantly track the package's movement throughout the system. However, track and trace can also be used for freight shipping and business-to-business transactions. Plus, some form of tracking and tracing is generally used for freight forwarding, less-than-truckload (LTL) shipping, and other types of large-scale shipping.
Today, tracking is also considered to be part of good customer service. When consumers order from an ecommerce site, they expect that they'll be able to easily check the location of their package with a tracking number. Customers often use track and trace information to plan for a delivery. That's why providing an easy-to-use, clear track and trace system is a great way to boost consumer satisfaction and confidence.
What is a track and trace system?
A track and trace system is a type of software used for shipment tracking. In general, each parcel or freight carrier offers its own tracking and tracing information. A business or 3PL may integrate that information into a single digital database that can be scanned by customer service agents, supply chain managers, owners, logistics managers, and others with an interest in locating shipments.
A logistics manager may need an overall view of the tracking system and statistical analysis of the routes of packages, the value found in different carriers, and success rates for deliveries. Customer service agents may need to access a different area of the same system to find out where a customer's package is and answer any questions that may arise.
How does track and trace work?
For most common carriers, a barcode allows each item to be tracked at key points in the shipping process: when a label is created, when a package is picked up from the fulfillment center, when it enters any distribution hub, and when it’s sent out with a delivery driver. For some high-value items, companies may use a form of real-time tracking to measure where the item is at any moment, but most common systems rely on scanning a barcode or similar unique identifier.
Most customers expect to be able to follow the progress of their deliveries through a shipment tracking system. By entering a number associated with the package’s barcode or QR code in a company's website or app, they can see a history of their parcel's stops at distribution hubs and when the package is out for last-mile delivery. In some cases, they may be able to see the weight and size of the box as well as shipment information.
Track and trace systems may use other types of monitoring, like RFID chips, GPS trackers, or bluetooth low-energy tags. However, those systems are most frequently used for highly sensitive shipments that may need minute-to-minute monitoring, temperature control, or other specific needs.
What are the benefits of track and trace?
Track and trace is ultimately about providing more transparency throughout the shipping process. This greater visibility in the supply chain provides numerous benefits.
Reduced costs
By using track and trace information, you can determine the most cost-effective routes for delivery. The data gathered will help you highlight problems and inefficiencies that lead to waste, improving delivery management. Track and trace can also cut down on the costs that come with replacing lost packages, as they are far more likely to be found.
Improved customer service
Not only can customers track their own packages, but businesses are also empowered to provide useful information and resolve problems for customers with shipping issues. The company may be able to identify delayed or lost packages before the customer complains and proactively notify them or send a new shipment, nipping negative customer experiences in the bud.
Enhanced trust
By providing transparent tracking information, shippers will be seen as more trustworthy. Customers and vendors will feel greater peace of mind when they have access to transparent data, and will be less likely to make frequent customer service demands—freeing up your internal team’s time.
Identified and resolved problems
Track and trace systems can identify problems in the supply chain. You may find that packages are more likely to have problems on certain routes or that there are conditions that lead to an increase in lost or late packages. This information can enable you to identify problems and improve your supply chain management.
What is the difference between tracker and tracer?
The two terms are most frequently used in tandem when applied to shipping. However, a tracker is generally looking at the progress of the item moving forward, including real-time location of a parcel. On the other hand, a tracer is tied to the route the parcel has taken through the supply chain, including the chain of distribution centers and hubs it has moved through on its way to its current tracked location.
