The creation of Amazon Prime and other big-name retail companies that offer free 2-day or on the day shipping has skewed what customers view as “acceptable” delivery times. The speed in which the customer receives their product can make or break whether they proceed with the purchase.
To be on the top, e-commerce companies have to satiate that craving for speed that the consumers have. People aren’t as patient as they were before, and they know that other options can be much quicker than you, and they will not hesitate to abandon you.
Order fulfillment is something that can positively impact your speed and fulfill the need that your customers want. But before you jump the gun, you have to understand how it works!
Order Fulfillment—What Is It?
Order fulfillment happens between receiving an order and the order being delivered right at your customer’s doorstep. It works by storing inventory by buying in bulk from wholesalers, packing the products that your customer orders, and shipping them directly!
Business-to-business (B2B) orders that require large quantities of a product shipped to retailers and business-to-consumer (B2C) orders that require the item to be delivered straight to the shopper are both applied through e-commerce order fulfillment.
Understanding The Process—How Order Fulfillment Works
If you aren’t familiar with e-commerce order fulfillment yet, you’re probably oblivious to the process as a whole. Knowing what happens every step of the way is crucial information for both the company and individuals who frequently purchase items online!
Many gears have to turn to make the process work out—each piece is crucial and required for the method to work out smoothly.
Receiving & Storing Inventory
Before orders can come flooding in, you need to have stock ready in your inventory. The things you’re putting up on sale on your e-commerce website have to be on-hand and ready to go.
You have two ways to go with inventory, you either handle it yourself or use an order fulfillment outsourcer to take care of it for you. If you do it yourself, you’re going to be responsible for accepting stock, checking and maintaining inventory, adding labels, and managing the entire thing. For the latter, the outsourcing company has got you covered!
After receiving inventory, you have to store it through inventory storage or warehousing. Warehousing is how you keep, organize, and secure your products so that you know what is available to be shipped to your customers.
When a customer hits the check out button, an order gets submitted. The order will then get processed by retrieving the item from storage and getting it ready for shipping.
Everything from including instructions on the packing material to use, such as bubble wrap, poly bags, or packaging tape, ensures that the unboxing experience is smooth for the customer. Including a shipping label is also a requirement before it’s shipped off.
Adding specific shipping instructions ensures that the item can make it to one piece when it arrives at the customer’s location!
Shipping The Product
After the order gets processed and prepared, it’s ready to be sent to the customer. A third-party courier service gets used for convenience. However, the customer can also pick it up in their local post office if they choose to.
Processing The Returns
There will be situations where a customer returns a product, and when that happens, you have to be prepared to process it. The product gets shipped directly back to you or the order fulfillment provider so that processing can commence.
If the item is still of good quality, it gets placed back into inventory. However, if it’s defective, it gets disposed of because of malfunction.
Strategizing With Order Fulfillment
If you plan on getting your e-commerce standing on the same pedestal as some of the giants, you’re going to need a strategy. Planning out everything and knowing what you want to happen to your business is the first step to success.
Here are some crucial things to consider before you begin!
Taking Advantage Of Location
For e-commerce order fulfillment, location is everything. The area you’re in is a crucial factor if you want to satisfy your customer’s expectations for the delivery speed and cost!
Having affordable shipping prices and fast shipping options are what consumers seek for the most. Optimizing your fulfillment based on these factors will help you gain more customers while remaining cost-efficient.
Having low prices while maintaining speedy delivery times can be difficult, especially for overseas shipping and orders from one side of the country to another. However, a method you can use to get around this is distributing inventory and stocks in multiple locations based on your general demographic. That way, you can cater to a lot more people and give faster delivery speeds while not off-putting people with costly delivery fees!
Free Fast Shipping
Free same-day or 2-day shipping is a lot more attractive than you’d think. When people want something, they want to have it as soon as possible, but they also don’t want to spend too much on shipping. When getting fast shipping for free, customers can kill two birds with one stone!
Shipping isn’t free for the e-commerce company, so make sure that your pricing is smart.
E-Commerce Fulfillment Models—Which One Should You Use?
When choosing which model to use, be sure to take into account the merits and which one fits your business the best!
In-House Order Fulfillment
This method requires you to be involved in all of the steps internally. In-house order fulfillment takes up a lot of your time and can sometimes require some investment for automation. In-house is usually for those who are just starting in the e-commerce scene!
Dropshipping is the most hassle-free model to utilize. All you have to do to fulfill an order is to place it with your supplier, provide them with the customer’s address, and the supplier will pack and ship it straight to the customer!
Third-Party Order Fulfillment
Outsourcing a third-party order fulfillment service is your best bet if you want to focus on advertising your business and building your brand. Third-party order fulfillment is also great if you don’t have the resources to package the goods you sell locally!