Finding, hiring, and retaining a staff of warehouse workers is difficult, expensive, and time-consuming. It's hard to find skilled and reliable employees that are qualified to work at your business.
The time it takes to fill one order varies and can last anywhere from days to weeks. This uncertainty frustrates customers and puts pressure on your brand. Waiting is also exhausting, which creates anxiety and prevents customers from shopping at your store again.
Outsourced fulfillment centers help solve these problems by providing an efficient solution that's easily scalable for brands of all sizes. You can enjoy peace of mind knowing your orders are being handled quickly and efficiently.
In this article, we will discuss the benefits of a fulfillment service in order to find the right one for your needs.
1) Pay as you grow
Fulfillment centers have a subscription fee but most of your expenses will be coming from receiving, storing, picking, packing, shipping and delivery. But if you're not making sales you mostly be paying for storage fees.
If you're making the best use of your storage space, your overhead costs will be ridiculously low as compared to renting a warehouse.
When sales pick back up again you don't have to worry about recruiting and hiring reliable workers. The fulfillment center simply processes the orders and ships them so the only thing you have to do is worry about getting more sales.
2) Offer superior customer service
The ability to return packages is super important to customers. If that process is not seamless it causes problems down the road.
Luckily fulfillment centers handle all your returns. They have a 24-hour customer service staff that's ready to take on any shipping-related questions your customers may have.
When you're looking for a fulfillment center make sure they provide order tracking, prepaid return labels, and notifications.
Once the product is received, they'll check for damages and wear. If everything checks out okay they'll restock the item.
Note: If customers are frequently returning a particular product, that’s a clear sign that there's a defect or flaw in your product’s design. So you may want to check quality control by contacting your manufacturer.
3) Manage your inventory better
Some fulfillment services offer artificial intelligence to manage your inventory. Machine learning will take into consideration your average sales volume and provide recommendations on how to manage your inventory.
If you come across a fulfillment center without minute-to-minute tracking options, do yourself a favor and run away as fast as you can.
The main purpose of a fulfillment service is to save time and shipping costs. If you run out of stock, you’re losing money. But if you have too much stock, you'll be paying unnecessary storage space and fees.
For example, Fulfillment by Amazon (FBA) has a long-term storage fee. For any unit not sold within 365 days, FBA will charge an aged inventory surcharge.
Advanced analytics tracking would tell you when products are coming in and out so you can make a decision to offer promotions and discounts in order to get rid of the excess inventory.
4) Sell on multiple channels
Get the most out of your store by selling on multiple channels such as Amazon, eBay, and social media platforms.
You can sync your fulfillment center across multiple sales channels. When your customer makes an order on one of these channels, it’ll notify the fulfillment center so they can begin processing.
Some fulfillment centers cannot link to multiple sales channels or they cannot link to certain ones. When selecting a filament Center be sure that syncs with the platforms you plan on using. If not, you limit the number of potential customers you can reach.
5) Increase productivity
Starting an ecommerce business is very time demanding. You have to wear many different hats, especially in the beginning stages.
In many cases, you have to be the marketing expert, the sales expert, the web developer, and the fulfillment director.
But that's the bootstrapping phase. Now you're in the growth and scale phase.
So you have to make a decision. Are you going to focus on marketing operations or fulfillment operations? You cannot do both. It’ll kill your productivity.
According to psychologist Gerald Weinberg, your productivity will drop by 20–80% as you take on more tasks.
And you’re 50% more likely to make errors.
When you work with fulfillment service, you’re essentially hiring a director of fulfillment that takes care of everything from recruiting and hiring to shipping and returns.
Fulfillment services provide 24-hour staff that takes care of all your fulfillment operations. All you need to do is provide an adequate inventory supply and the fulfillment center will handle the rest. How sweet is that?
6) Ship your orders as fast as large retailers
You limit your selling options when you don't have quick, reliable shipping. Two-day shipping is the new standard. And if you fail to meet that standard customers would not hesitate to go find someone who can.
In fact, according to a recent MetaPack survey, over half of online shoppers abandon their purchase if they don't get the delivery options they want.
And consumers want fast shipping.
An exclusive survey by Internet Retailer and Bizrate Insights found that consumers deemed 3–5 days as the most acceptable wait time for online orders. What’s more? Nearly half of consumers say fast shipping is equally as important as free shipping.
There's no way around it: Your product has to be close to your customer in order to offer fast shipping. But establishing multiple in-house distribution centers is ridiculously expensive.
By working with a fulfillment service with multiple centers, you can allocate your inventory in multiple locations and get your package delivered to your customer much faster.
7) Offer custom packaging
Fast shipping and order tracking is nice but the ultimate order experience is the unboxing phase.
This can make or break your business.
According to The Packtory, 95% of customers say bad packing can ruin an online customer's experience. On the other hand, 52% of customers say they are more likely to repeat business if the unboxing experience was memorable.
Some fulfillment centers work with third-party companies that specialize in custom packaging. This will give you an edge over your competitors who ship products in cheap plastic and tape.
That’s what happened to Keith Tritschler, Creative Director at Smilo, a store that sells baby products. To get a competitive edge, he asked Ashtonne Packaging to design a custom package that would enhance their customers' unboxing experience.
Reward your customer with a great brand experience and they will reward you with repeat purchases and spreading the word.
In fact, 83% of online consumers are willing to share unboxing experiences on social media platforms.
Fulfillment centers can help you scale your growth faster. They provide an opportunity to expand your business without additional investment in infrastructure and personnel.
When looking for a fulfillment service, it is important to consider the following: The level of expertise and experience, quality of services, shipping speed, multi sales channels, and advance order tracking.