Fact: Your ecommerce fulfillment provider must be close enough to your consumers to enable rapid order fulfillment. Rather than picking an ecommerce fulfillment provider location or third-party fulfillment firm just because of its proximity to you, it is a better policy to use analytics to guide your choice. This way, you are ensured that your ecommerce fulfillment provider delivers on-time and supports your orders. Here’s how to do it.
Fulfillment is all about risk management. In fact, you should never choose ecommerce fulfillment services with your eyes shut to the big picture. Your returns process should be as efficient and accurate as possible. So many ecommerce entrepreneurs make the mistake of cutting corners in their returns process. And since they are not aware of the real costs, they cannot accurately determine the profitability of their ecommerce business.
Fact: Most ecommerce businesses carry a fair bit of inventory – even if they are just a small operation. It’s a good thing that many ecommerce fulfillment companies provide storage inventory for ecommerce businesses. But not all of these storage inventories are the same.
Fact: The storage inventories that your ecommerce fulfillment provider provides may not be ideal for several reasons. If the inventory numbers aren’t large enough to meet the demand for your products or services, you could experience stocking time delays, and thus higher shipping rates. Or you could experience a situation where you’re receiving too many returns and not being able to cancel orders. In short, there may be some storage space lost when you’re picking and storing inventory yourself.
Fact: Some ecommerce fulfillment services do a poor job at packing and moving. Or on occasion, the products they pack and store may become damaged during shipping. In either case, the return or refund rate can be high. If you’re paying a lot of money to have your goods picked and packed, this can add up to a lot of money in lost revenue. By contrast, you’ll save a significant amount of money by handling the entire process yourself.
Fact: It’s entirely possible that an inferior ecommerce fulfillment service will sabotage your entire ecommerce business. This happens rarely, but it can happen. For example, a fulfillment company could place orders inaccurately, not picking products up on time, or packaging products incorrectly. Your product will arrive late, and you’ll lose sales because of this. Your vendor account could even be closed because the vendor is unable to process your return orders.
Fact: Some vendors do offer free shipping. But the quality of that shipping could turn out to be substandard. Shipping costs are what really kill sales, so it makes sense to avoid shipping costs altogether. Instead, use a carrier that charges a delivery fee of a small percentage of your total order value. Then use a fulfillment company that charges a flat rate for all shipping and handling charges. You’ll always know exactly how much inventory you need to store and handle, and you’ll only pay for what you actually need.
All of these pitfalls can be avoided, of course, if you work with a highly reputable ecommerce fulfillment center. These fulfillment centers provide superior customer service and a hassle-free purchasing process. With access to their large database of available products and fast shipping services, they can quickly pack and ship all your orders, eliminating any costly mistakes.
Fact: Many ecommerce businesses don’t have the time to pack and ship orders themselves. That’s why they’re looking to an outside source – a fulfillment services company – to take care of all that work. But an in-house packing and shipping department can be expensive, inefficient and time-consuming. That’s why many ecommerce business owners choose to outsource this aspect of their business to a third party. With fulfillment services, you don’t have to waste precious time or money on things like packing and shipping.
Fact: By outsourcing these tasks to a third party, you can get more products done in the same amount of time. An in-house packing and shipping department only have so many products to pack and ship, so they’re forced to prioritize according to where they are in the supply chain. This means that they might order less items with a particular product classification than another classification. When they have less product to pack, they have to get more Pickers in the process to help speed up the process. And that means more orders from the same or different customers, which is another added benefit.
Fact: By delegating these functions to a third party, you can improve your customer expectations for your product. The best ecommerce fulfillment services will always provide excellent customer support, but they won’t do it for free. That means you won’t have to spend countless hours of phone calls and email exchanges trying to get them to answer your questions. If they can’t help you, then they won’t do it for other customers. It’s your money on the line, after all. So your best bet is to let an expert handle these matters and make sure they meet your customer expectations.