Are you running an e-commerce business? Having a place to store your inventory and shipping orders is a considerable expense and difficult to manage. Outsourcing order fulfillment can help you save time, money, and effort.
There are several advantages to outsourcing fulfillment. You’ll find all of them in this post, so keep reading!
What Happens When You Outsource Order Fulfillment?
When you outsource your e-commerce business’s order fulfillment, a third-party service handles some logistics for you. While it can vary slightly between companies, most fulfillment centers will:
- Store your inventory for you.
- Track inventory stock.
- Provide you with warehouse locations.
- Process and pack customer orders.
- Provide unique packaging.
- Ship and deliver orders.
- Provide tracking for customers.
- Handle returns.
So, fulfillment centers are very convenient for most businesses, no matter your size. Many small businesses turn to third-party services for assistance when they grow and can no longer keep up with orders.
Overall, switching to a fulfillment center allows another party to handle inventory, shipping, and returns for you. It’s very convenient and comes with plenty of benefits.
The Advantages of Outsourcing Your E-Commerce Order Fulfillment
Outsourcing your order fulfillment can give you an advantage over your competition. The process becomes much smoother and can save money too.
Let’s break down all of these advantages:
1. Improved Customer Experience
First and most importantly, outsourcing allows you to provide customers with a much better experience. Many fulfillment centers offer unique packaging for your brand, giving you a better first impression.
Your customers will also feel much more valued when you provide fast deliveries. With order fulfillment, they can track their order, too, making them trust your brand much more.
When you provide an improved customer experience, you’ll also increase customer loyalty. Doing so encourages previous customers to continue shopping with you repeatedly, making it extremely important.
2. Better Inventory Tracking
Knowing exactly how much of a product you have in your inventory is essential. However, it can become difficult to track if you’re a small business getting a lot of orders.
Outsourcing to a fulfillment center can help you better track your inventory. The service will do it for you accurately. They also have access to equipment and software you don’t, allowing them to track inventory more efficiently than your business could.
They even update inventory in real time, so you know when to restock.
3. Cost-Efficient Order Fulfillment
Next, your company can save money on order fulfillment through a service like this. As your orders increase, providing fulfillment in-house becomes extremely expensive because packaging, warehouse space, and labor costs add up fast.
When you outsource, the fulfillment center charges you a flat rate for everything, allowing you to save money. As your business gets bigger, you’ll save more money. Essentially, you’ll only pay for what you use. Plus, some fulfillment centers offer free services initially, letting you save more money upfront.
Lastly, outsourcing can save you time and energy, allowing you to put it into other business areas. You can spend more time perfecting your products and branding, which can help your brand grow more in the long run.
4. Access to Warehouses
You can also have cheaper access to warehouses when you outsource fulfillment. The center provides staff to pick and pack orders, streamlining the process for you. You won’t need to deal with managing the fulfillment warehouse, either.
So, outsourcing is a good idea if you need access to warehouses. You can often choose where you want the warehouses to be based. Choosing locations closer to where most of your customers are can make shipping times faster and increase customer satisfaction.
Overall, if your business is growing and you need more space for your products, a fulfillment center will benefit you greatly.
5. Faster Shipping
Customers can also get their orders much faster with outsourcing. You can even provide them with cheaper shipping costs, helping you to sell more of your goods.
Shipping is faster because fulfillment centers can provide improved labor allocation, speedier picking and packing, and streamlined delivery. They usually have a lot of staff who can work on the order as soon as it comes in, speeding up the whole process.
Many centers also have multiple warehouse locations, allowing them to send the order out from the closest to the customer, drastically cutting back on delivery times.
So, you’re sure to get improved shipping times. For many customers, the speed and cost of shipping can impact whether or not they complete their order. If you want to sell more, having faster shipping is crucial.
6. Better Order Tracking
Next, you and your customers can receive better order tracking with outsourced fulfillment. They can provide seamless integration with the systems you already have and offer real-time updates to keep everyone on the same page.
You’ll always know where orders are, allowing you to assist customers better if required.
7. Overall Reduced Costs
Finally, outsourcing fulfillment can provide you with overall reduced costs. You don’t need to pay individually for storing goods and packaging materials. Plus, you’ll only pay for what you use, so you won’t overspend on materials you don’t need.
Outsourcing also helps to reduce labor costs. You don’t need to pay employees for training and benefits since the fulfillment center should provide everything to their workers.
That means you can save a lot of money over time. While there’s usually an upfront cost, you still save. You can put those savings towards other areas of your e-commerce business.
Of course, reduced costs are always worth it! You’ll want to list what services you want from the center, then compare the prices of all your best options to ensure you get the best deal.
You Can Get These Advantages When You Outsource
These advantages and more can be yours when you outsource your order fulfillment. Your business will be able to grow faster, and you’ll have a much easier time keeping up with sales and shipping.
If that all sounds good to you, why not outsource fulfillment? You’re sure to appreciate the benefits that come with it.