Ecommerce fulfillment can be a huge headache for ecommerce owners. When you’re starting out, it’s difficult keeping up with emails, let alone figuring out the logistics of shipping!
Luckily there are platforms like ShipSimple that make ecommerce fulfillment less stressful by handling all this for you to maximize efficiency.
Let’s look at how ecommerce fulfillment works and why eCommerce businesses should consider using a platform like ShipSimple if they want to save money on their shipping costs.
Why You Need Ecommerce Fulfillment Services
The secret revenue driver of the world’s top ecommerce businesses.
Fulfillment and eCommerce fulfillment services can be a huge boom to an e-commerce business, and it’s not just about the delivery.
The rate which an ecommerce business fulfills its products, on average, is one of the most important factors in determining if it will grow or stagnate.
What many businesses don’t realize, though is how much more this process impacts them than it does traditional retail stores, and here’s why:
Retailers get all their shipments together at once and send them off for distribution through network hubs.
Ecommerce stores have individual orders coming in throughout the day from people across different communities.
That means each order needs its own packing slip with tracking information included before being sent back out for delivery.
The simpler this process can be, the better.
The e-comm fulfillment industry is booming, but ecoms have been slow to adopt these services. In part because there are so many different options available and ecommerce owners don’t know where to start.
That’s why we’re going to break down exactly how ecommerce fulfillment works for an online business owner.
Additionally, ecoms are the final step in a long supply chain that begins with manufacturing and ends up at your doorstep.
Traditional retailers simply need to receive goods from suppliers and then store them until they’re sold.
The ecommerce business has to find the supplier themselves, package their product for shipping, handle customer service inquiries about the product, and then ship it out.
Ecommerce stores are doing more work for less money–and as a result they’re often paying higher fees to fulfill their orders than brick-and-mortar stores would need to pay.
So here’s the great news: ecommerce fulfillment services can help!
With ShipSimple you could save up to 75% on shipping rates today. Get started now.
Fulfillment drives revenue
Fulfillment drives revenue because it is the final stage of selling your eCommerce items.
You only have one shot to make a sale, and that’s when your customers are at the checkout page.
It’s up to you how far along in the transaction process a customer gets before they choose not to continue with their sale.
You can’t re-target them or catch them in another place on your site or app later because once they’ve checked out, just like that, they’re gone.
Consumers’ short attention spans are notorious for not waiting around long enough for eCommerce businesses to make their case. Customers expect eCommerce businesses to offer free shipping. And if they don’t, customers expect other benefits instead like faster delivery or even same-day shipping.
If an e-comm business doesn’t offer free shipping, they’re most likely going to lose out on the sale because customers will go with the competitor that offers it instead.
In fact, some markets that refuse to provide free shipping (or can’t afford to) risk losing 70% or more of their customers to abandoned a purchase due to unsatisfactory shipping options.
Some eCommerce fulfillment companies work with retailers to offer free shipping on all orders, while others charge a flat rate for every order no matter what the size.
This is why fulfillment plays such an important role in driving revenue–in order for profits to increase, more items need to be sold and shipped.
If you’re not set up to easily fulfill orders as they come in, you could miss out on the opportunity to make a sale because your customers may think that your product is unavailable.
It’s also vital for an ecommerce business owner that they are able to keep track of their inventory, and have enough information available about their products and shipping so that potential customers can make informed decisions when placing orders from their site.
The Challenges of Ecommerce Order Fulfillment
Ecommerce fulfillment is a difficult and time-consuming process. It’s also one of the most expensive parts of ecommerce, costing company owners thousands of dollars per year in shipping costs.
For small businesses and startups who work on tight margins, ecommerce fulfillment can be a major drain on your finances if you don’t have the best fulfillment strategy in place.
But there are ways to cut costs on eCommerce shipping!
Platforms like ShipSimple that offer third party fulfillment services that make it easier for small businesses to save money while they grow by providing all the tools necessary to get started with eCommerce today – including free quotes from top-rated carriers!
Should I outsource my eCommerce fulfillment services?
As an internet company grows, the logistics of delivering their inventory can become overwhelming.
Outsourcing fulfillment to a third party can be a cheaper way to support expansion and meet customer expectations.
Dedicated projects will be easier than trying to juggle all shipments in-house so you can continue running the business’s core services and devote more time towards growth.
Four Myths About Fulfillment Centers and the Fulfillment Process
Myth: A rural fulfillment center will save me the most money?
Truth: e-commerce fulfillment can save you money in a variety of ways.
– You have to factor in the cost of shipping from your rural fulfillment center back to your customer, which will be higher than what it would be if you were fulfilling orders at home or near where customers are located.
Myth: Do I need a fulfillment center close to home?
Truth: the order fulfillment process is all about providing the best customer support and experience.
– You should choose a fulfillment center location that provides you with access to quick and reliable delivery for your customers, or near an airport if you are sending packages internationally.
Myth: It’s cheaper to fulfill ecommerce orders myself than working with fulfillment companies.
The eCommerce fulfillment myth that it’s cheaper to handle the order fulfillment process yourself needs busting.
That may have been true in the past, but not any longer with all the changes that have come about over the last few years.
The truth is, most online company owners are doing themselves a disservice by trying to manage everything on their own.
Myth: Shipping from an ecommerce fulfillment center will be faster than shipping at home?
Truth: an eCommerce fulfilment center uses a variety of methods for fulfilling orders, including shipping from ecommerce fulfilment centers.
It’s not always the case that shipping from an ecommerce fulfilment center will be faster than shipping from home.
Depending on the fulfillment center, they may use a variety of third party methods for fulfilling orders, including shipping from an ecommerce fulfillment center.
Yet, ecommerce fulfilment centers [also known as distribution centers often operated by third-party logistics (3PL provider)] are designed to handle ecommerce orders in as efficient a manner as possible, so the process of shipping from an ecommerce fulfillment center is typically more streamlined.
There are many positives to using a fulfillment center like this beyond speed.
They have a wide selection of packing materials, can provide warehouse space or inventory management for your products – if you need it.
Understanding Ecommerce Fulfillment: Definition, Process, Resources
What is ecommerce fulfillment?
If you’re thinking of starting an online storefront, your first order of business is to decide how you’re going to ship your products.
Ecommerce fulfillment involves fulfilling orders on behalf of you – the retailer.
This can be as simple as a one-click process for customers who only have to provide a shipping address and billing information.
Or it may need tracking information and other complex details.
How does ecommerce fulfillment work?
Ecommerce fulfillment is a process that e-retailers need to figure out before they start selling.
Most companies consider both their budget and customer service levels when deciding how to handle their order fulfillment. This is especially true if you carry expensive items like furniture or electronics.
Some retailers may want some control over their packaging so that customers receive their products in pristine condition. But others might take the more hands off approach by using pre boxed shipments from a third party provider.
Whatever your path you must weigh out your options before confirming with an ecommerce fulfillment company.
How does ecommerce logistics work?
Ecommerce logistics is the process where ecommerce orders are processed, packaged for shipment and delivered to customers.
E commerce fulfillment services include picking items or manufacturing and storing inventory until it’s sold .
Some eCommerce companies outsource their distribution centers so they don’t have to handle the physical work themselves.
Does the fulfillment process include shipping?
Yes, fulfillment includes shipping. Fulfillment refers to every step that happens from the moment a customer places their order until you pack and ship your product and it reaches its final destination.
What are the steps involved in the ecommerce fulfillment process?
In order for your customers to enjoy their purchases in the most efficient way possible, it’s important that all aspects of fulfillment are taken care of.
From processing orders and keeping inventory management organized before sending out a shipment, to ensuring packages can be tracked as they make their way through transit systems across land or sea- there is much more going on behind the scenes than you might realize!
The six steps in the order fulfillment process are:
- Receiving
- Holding (storage or inventory management)
- Picking
- Packing (including labeling)
- Shipping (tracking numbers!), and
- Returns processing.
What are the three functions of order fulfillment?
The three functions of order fulfillment are receiving, processing, and delivering.
Receiving involves obtaining inventory. Processing is when orders are received and managed. And delivering is when packages go to customers.
A beginner’s guide to eCommerce shipping and fulfillment
Want to start your own eCommerce business?
It’s not as complicated or challenging as it sounds. And you don’t need to be a logistics expert either.
With determination and this from start to finish guide, you’ll be able to handle order management, inventory, packaging and shipping quickly!
Lucky for you we’re here with some tips on how to get started: read this starter’s guide about fulfillment now!
How do I choose an eCommerce fulfillment provider?
Choosing an eCommerce fulfillment provider can be tough when there are so many options out there.
eCommerce fulfillment providers can cost anywhere from $0 to a few thousand dollars per month depending on the services they provide.
The first step in deciding what eCommerce fulfillment provider best suits your needs, is price point, customer service or whether you want somebody else handling shipping for you.
Evaluating order fulfillment services: questions to ask
It’s okay to ask a lot of questions so you can be sure what eCommerce fulfillment provider is best for your business needs.
You need to find out as many things about them and their system, before choosing one service over another! Ask these five important questions below:
1) What type of products do they handle?
Most providers are specialized in specific types or brands but some process all product categories.
Does your ecommerce business ship food, wine, or other perishable items?
If so, you should be looking for an eCommerce fulfillment provider that specializes in these products and works closely with third party couriers that do so as well.
If not, then it doesn’t matter as much what they specialize in.
What type of ecommerce business do you have?
Do your customers expect fast shipping and delivery or are they willing to wait if the price is right?
2) Do I have an account manager who will work with me on this project from start-to-finish?
Clearly define what roles each person fills when discussing different services offered by potential vendors.
Your fulfillment process should make sense for your business and you should set your customer support expectations from the start.
One of the first things to look for in ecommerce fulfillment services is whether you have an account manager who will work with you on this project from start-to-finish.
Your account manager should be available when needed and ideally, they are knowledgeable about your industry so that they can provide insight into how best to fulfill orders based on your customers expectations.
3) If you need a fulfillment center to handle your inventory management – How much inventory space does your order take up during storage at their warehouse/distribution center?
Order fulfillment takes a lot of time and resources, so it is important to know what happens to ecommerce orders if you do not need them stored.
Pay close attention to what fees the fulfillment provider might charge for inventory storage, as well as any specific time frames you have to remove unsold products and how they handle returns.
This is especially important if eCommerce fulfillment services only store a certain amount of product before charging an additional storage fee.
If eCommerce fulfillment services charge a specific time frame to remove unsold products, then you should be aware of how quickly your inventory sells and the potential for returns with that timeframe in mind.
For example: if ecommerce providers store products only until 30 days past shipment date, make sure this is still within the customer’s return window.
4) What is the minimum requirement of batch size I need to meet to get an ecommerce fulfilment quote?
Some fulfillment providers need you to have at least 500 packages in your batch size for them to be able to give you a quote.
Always ask if there are any minimums (or maximums) you need to reach to work with that particular fulfillment company.
And lastly,
5) What is the fulfilment companies’ service level agreement and how do they track shipping orders for me and my customers?
Some eCommerce providers have a guaranteed delivery time of two days while others guarantee their rates regardless of any unforeseen delays. Your needs will dictate which type you want to use.
A provider with guaranteed shipping rates will be more expensive but might save you money in the long run if they have a higher fulfilment rate.
Here are eight things you should also consider for when it’s time to choose an order fulfillment company for your online business.
– What is your budget?
Will you need a company that offers volume discounts or who will give you free quotes and lower shipping costs?
What are your needs? Do you need picking and packing services? How about inventory management, inventory storage and day shipping options?
Will you save money and time with services like pack and ship, inventory warehousing, returns processing, business logistics consulting?
The less order fulfillment services your online store needs, the more you can save and the more options you will have in selecting the best ecommerce fulfillment service.
– How much time do you have for inventory and fulfillment work each day?
Do you want help with order processing and packing, or would prefer to handle everything on your own as quickly as possible?
It’s also important to think about the type of products that you’ll be selling. If they’re fragile, it may not make sense to go with an ecommerce fulfillment service since you’ll need to be careful with the packing and shipping.
– How much ecommerce freight can your business handle?
Do you want a company that will offer ecommerce logistics services for international orders, or are you only looking to ship domestically?
Before deciding on a fulfillment provider for your online store calculate how much freight delivery you currently handle on a month to month basis.
Next decide how much you could handle if you grew your customer base and business began to boom!
The key to choosing the best ecommerce fulfillment platform is to find a partner that can currently meet your needs but grow with you and help you meet customer expectations while doing so.
– Do you need an order fulfillment center?
Consider whether or not your business needs an ecommerce fulfillment center that offers a physical location for your inventory.
The alternative to not using a fulfillment center is to pick and pack from home or another warehouse management location that makes sense.
– Location of Fulfillment Centers.
Warehouse fulfillment centers are normally used for inventory storage. But order fulfillment centers have a variety of duties.
These types of fulfillment centers usually pack and ship orders to customers, are able to manage and store customer returns, plus may even offer custom packaging options for your business.
If your business requires you to use a fulfillment service center in order to ship your products, consider looking at a fulfillment company with a centrally located warehouse.
You may also want to ask what type of storage space is available especially if you need temperature control for your products.
Or what their storage fees might be and if they offer pick and pack services.
An Ecommerce fulfillment process that is more efficient eases the delivery process, can result in lower shipping rates and better customer support for both consumers and ecommerce business owners alike.
– Do you want an e-commerce order management software?
If your store doesn’t need a fulfillment center or warehouse for its fulfillment and shipping needs, then you may need a management system software instead.
An ecommerce fulfillment software program can help you manage inventory, e-commerce orders and customer information.
An eCommerce order management system will also allow you to take care of all your eCommerce fulfillment needs from the comfort of your own computer chair!
What you should look for in an eCommerce fulfillment platform
With order fulfillment software, you can automate all your inventory management and processes that come with fulfilling shipping orders.
You’ll be able to generate picking lists, print labels and ship your products out quickly to customers!
With automation like this it’s easy as pie to run a store online without any hiccups along the way.
Fulfillment software is indispensable to online store merchants.
Whether they self-fulfill orders, these third party logistics providers (3PL provider in short) can help simplify the process of shipping and significantly reduce costs for small businesses owners.
An order fulfillment software should be able to handle eCommerce shipping quotes and ecommerce order management too.
You’ll also want a platform that has customizable options for your e-store, such as an inventory control system and customer relationship management features.
If you’re looking for ecommerce order fulfillment services or third party fulfillment services then it’s important to find ecommerce fulfillment services that can meet your needs now and continue to grow with you as a business.
Many ecommerce fulfillment companies will allow you to test their software and in most cases allow you to get started for free.
Before choosing your courier management software consider the following before settling on your fulfillment company:
What third party carriers does the ecommerce order fulfillment platform support?
Online retailers need to know who they are working with when shipping their products. And who your fulfillment company works with matters to your business.
Do the work already work with some of your preferred third party fulfillment couriers?
Who else do they work with that could potentially help you expand your sales channels or customer service reach?
Do you recognize any of the brand names of the couriers?
Have you had any issues in the past with customer support or service with any of the couriers?
All these situations affect your decision so its best to know ahead of time before making any commitments.
Shipping Speeds
The eCommerce fulfillment company you choose should be able to offer shipping speeds that work for your business.
If you’re selling electronics, or other high-value items, you’ll want a fulfillment process that includes or offers insurance, plus expedited shipping options to ensure your products get delivered on time.
If you’re running an online store with high volume, and need something done fast – choosing the right order fulfillment partner can help keep your business efficient without breaking the bank.
Features of Order Fulfillment Software
Order Fulfillment Software can help small companies keep up with the demands of ecommerce order processing by automating tasks.
When considering what software to work with think about these features:
Ease of Use
The software should be easy to use for anyone with basic computer skills.
And if you’re buying an order fulfillment software, it should be intuitive enough to not need many training sessions.
The eCommerce order processing platform also needs to work well with your e-store and the other systems in place at your company.
Integrations
What are the integration capabilities in this software? Does it integrate automatically or will you need custom code to make it work with your online store?
From the moment an item is added to the shopping cart and a customer places an order, till the day of delivery, you’ll want to make sure that your fulfillment company can be there to help you every step of the way.
Cost
Pricing for the software shouldn’t break your budget, but it should also provide enough features that you’re not paying for something that’s too simple.
Will you need to invest in updating any of your business’ technology?
Are there any monthly fees or commitments you should know about?
In regards to shipping rates and costs will you need to pay up front? Are there any payment plans or pay as you go features?
Ecommerce fulfillment providers should save you both time and money.
Support and Training
You want to make sure there is plenty of support available in case you need help or have a question about how to do things on your own.
- What type of support does the order fulfillment software company offer?
- Are there training videos and e-learning guides?
- Is there one-on-one support available?
- How about live chat features?
Decide what kind of customer support you want and what kind of service you expect before committing to an order fulfillment process.
A recent study showed that when people can see the shipping process and their purchase in transit, they are more likely to buy from that store again.
Transparency and Visibility
In e-commerce, transparency and visibility are paramount. Brands and retailers are trying to have real-time updates on their supply chains.
Companies like Amazon for example, have built their success by making sure that customers know exactly when their product(s) can or will be delivered and how much it will cost as well.
A recent study showed that when people can see the shipping process in action, they are more likely to buy from that store again.
New research also shows that a positive effect on customers is seen when an order in transit has greater visibility.
This means real-time updates and on-demand information are necessities, not value add features.
Despite the growing trend many e-shops still can’t achieve full supply chain visibility for their retail orders which may lead to lost revenue opportunities!
This is why eCommerce fulfillment services should offer as many automated tools to help you track your inventory levels as possible.
A few key features of an order management software that will be helpful for every company include:
- Integrates with your ecom platform(s) and provides software updates when needed
- Free freight quotes with sale
- View, manage and track inventory levels
- Inventory alerts when stock is low or back ordered
- Live tracking of eCommerce Orders
- Real-Time Updates & On-Demand Information about delivery
- Automatically import new orders
- The ability to manually enter in a purchase order
- Search orders
- Edit or update orders
- Invoice history
- Verify and process returns
- Access and run reports
- Branding Options
Returns Management
E-commerce returns processing is one of the toughest parts of fulfillment that many small business owners have to deal with on their own.
Not only do they need to ship products, but also get them into customers’ hands and then manage returns on time.
This is where ShipSimple comes in! With the platform, you are able to automate returns and save yourself time and headaches.
This way, you can focus on more important tasks like marketing and customer satisfaction.
Costs
ECommerce costs can add up quickly, and it’s important to figure out how much you are paying for every shipment before it goes out the door.
Ecommerce order fulfillment can vary depending on the size and weight of your items, where they need to be shipped, and whether you offer drop ship or local pickup. You should expect start-up costs for eCommerce shipping at around $200–$600 per month.
Before jumping on your FREE demo call, find out how many shipments you’ve sent this month?
Then ask yourself while on your call – is there one service provider who always seems cheaper than all the others?
Was the order fulfillment software able to beat your lowest rate?
What were some of the benefits and drawbacks to using the ecommerce fulfillment partner versus another company like FedEx or Purolator?
Also, you may want to consider how to pay for your shipping rates using the ecommerce order fulfillment software. Is there a pay as you go option? Do they accept all major credit cards? What about bank transfers?
These are just a few questions you’ll need answered as part of managing your online business needs.
3 Quick Questions and Answers about Shipping
How do I calculate the cost of shipping for my online store?
Your shipping price is typically based on where you’re sending the order and what type of delivery service you offer.
Delivery costs are one of the most important factors in running an online store. There are many ways to calculate shipping, but which way is best for your business?
Don’t be afraid to experiment with different promotions. Free shipping on all orders over $50? Flat rate pricing? Price by weight?
It can be a difficult decision to make, but it’s important that you find what works best for both you and your customers.
Should I offer free shipping?
Small businesses need to make a profit to stay in business so before offering free shipping it’s best to weigh out your options.
Whatever your shipping method, it’s important to offer some kind of incentive for customers who are willing to pay a little extra to get their package delivered faster.
Many ecommerce businesses offer free shipping, but offers like this can be risky and costly if you’re not prepared!
Make sure that the price margin on your product is high enough or else you may end up losing.
Offer a discount or promotion on certain delivery service options to your VIP clients.
Additionally, you can also try offering free shipping on a minimum order amount.
This strategy can help offset the costs of shipping by helping to increase your average order size, but you’re still the one paying for it out of your margins.
How to ship orders from your home or office
Shipping orders to customers from your home is becoming more and more commonplace for e-retailers than ever before.
Whether it’s to save money on office space or the time spent commuting, businesses are finding that they can get by at home with the right systems in place.
How does eCommerce fulfillment contribute to your success?
If you sell your products online then fulfillment is a critical step in your online store’s success and will have a direct impact on your bottom line.
It may seem like a simple process, but there are many steps to consider and mistakes you need to avoid.
If you can’t get your products into your customer’s hands in a timely fashion – then your shop may find it very difficult to compete and turn a profit.
The number one reason for an abandon cart is high costs in taxes, shipping, and other fees.
Customers are looking for a quick checkout process and don’t want to be bombarded with extra charges.
Sellers should list all costs and fees like “Pricing, Shipping & Returns” on the front page of their shop so there will be no surprises when your customer makes it to the checkout page.
It’s no secret that shipping is a major expense for online retailers.
But with the best e-commerce fulfillment process and strategy in place you can save big.
Whether you’re looking for the cheapest way to ship or need more features than what comes standard, ShipSimple has got your back.
With free quotes and pricing comparisons – no matter who you are – small business owner or large corporation – we’ve got an option just right for you.
It’s not too late to start saving! Get started with ShipSimple for free today and save up to 75%.
We make it easy by taking care of all the heavy lifting- we will find a carrier that meets your needs and ships your order for less money than what you are currently paying. You just have to worry about filling orders – we’ll handle everything else while giving you more time to focus on growing your business.
Get started today by requesting a quote from our innovative shipping software.
