You have been working hard on developing your ecommerce business. You have everything covered, but you are still struggling with your (most likely outsourced) fulfillment service.
It’s all about the platform
You may worry about how large your potential fulfillment service partner is, or whether their brand strategy is on par with the best ones out there. That is understandable. However, everything starts from the platform. If you both use the same ecommerce platform (and, let’s face it, there is no lack of choice out there), then things are pretty much settled. You will easily integrate their services. Top 5 things to look for in a platform:
- Time needed for the integration of services
- Processing orders from multiple platforms
- Order volume compared to the pricing plan
- Uptime compared to the competition
- Feature set in the enterprise version of the platform
Inventory tracking and reports
This goes without saying, but make sure your inventory is tracked automatically. A reliable NetSuite ERP cloud solution can help you keep track of your inventory and order management. As ecommerce, you live and die on the knowledge of “just the right amount”. This is why your fulfillment service needs to be on top of things – the moment something is shipped, your warehouse is notified, and the next batch of the product can be ordered. If you cannot log into the inventory management system directly, you are probably not using the right service provider. All this can cause unexpected delays in the delivery (which can cause a large number of customers to abandon their order) or an unexpected increase in shipping costs, leading to cart abandonment. This can have repercussions for the future as well, as these customers are likely to refuse doing business with you based on these experiences.
Speed is of the essence
Another vitally important service that you need to be rendered is the option for a quick turnaround. It is all well and good trying to find a service that best fits your needs – but the customer will rarely prefer anything else more than a same-day shipping option. Well, of course, they will probably prefer free shipping more, but that is something that depends on the ecommerce itself. Another equally important piece of information is how your fulfillment service handles returns. A vast majority of your consumers will find free (and fast) returns very important, perhaps even something that makes them a repeat customer.
How about the location?
To connect directly to the talk of speed, if shipping times are something your company needs more than others, you should also consider the location of your fulfillment service. Apart from the reduced shipping costs, which might allow you to even go free on shipping, and speed, it is also good for the merchandise not to spend a lot of time in transit. If you can pinpoint the area to which the majority of your orders go, you can use it as a reference for where you prefer your fulfillment center to be. Think about the future as well. A relatively smaller and cheaper 3PL service might end up costing you more. Perhaps they don’t have the potential national coverage you might need in a short amount of time as your business grows.
Have you considered drop-shipping instead?
For a certain number of ecommerce businesses, third-party fulfillment service (3PL) just won’t cut it. What they might consider instead is drop-shipping. Here is how it differs from 3PL: you don’t buy inventory. As someone makes an order – you contact the manufacturer, who ships it to your customer. There is no need for you to even have a warehouse or own the merchandise. Of course, what this means is that the money from the order does not go entirely to you, as you split the profits. Again, this is not for everyone, but it might be a solution for you, and it is worth considering.
Customer support, best support
Not a lot of things are more important than customer support these days, especially when we consider the role of social networks today. At any point anything can go public, painting your company in a good or poor light. This is why it is especially interesting that 80% of companies think they are doing excellent customer support, while only 8% of customers say the same Your fulfillment service needs to have a dashboard available for customers to be able to track the packages. Even though 50% of customers find it important to deal with the issues of products or services themselves, you might still end up taking the brunt of customers asking about their packages. This will not look good and it will take up the time of your own customer support. Remember to address the question of who covers the costs of fulfillment mistakes!
Pickers and packers
Some 3PL companies specialize in the size and weight of the product, filling a particular niche in the market. Depending on the products sold at your ecommerce platform, it is necessary to check how well (if at all) a particular service is equipped to handle your particular product. Sometimes it is not the bulk and weight, but the fragility of the goods that is a concern. Of course, special care must be taken when hazardous materials are transported, as they not only present danger to the customer, but to anyone included in the chain of delivery.
What is best for you?
That is the ultimate question and finally depends on the specific needs of your own ecommerce company. Hopefully, we shed some light on what you can expect and what should be the primary concerns when choosing the right offer for you, when it comes to integrating a fulfillment service in your booming ecommerce business. As your company grows and your needs change, so will the partners you need.