Fulfillment companies play a crucial role in ecommerce business. By outsourcing the order fulfillment needs of your online store to a third-party logistics company focused on delivering goods to your customers, you can streamline your own operations, save money and improve your customer experience.
Fulfillment companies are an often unseen but critical part of the entire online economy. Most customers, when making an online purchase, are understandably focused on the brand or site they are buying from. They don’t really think about what happens between clicking “Buy now” and when the order shows up at their door.
But fulfillment companies are what make ecommerce work, ensuring that millions of orders are accurately completed and delivered as quickly as possible every day and making the dramatic rise of ecommerce in recent years possible.
What is e-commerce fulfillment?
E-commerce fulfillment includes all steps involved in delivering items ordered online to end customers. This starts with warehousing through order picking and packing at a distribution center and transfer to a shipping agent for delivery to the customer. In some cases, ecommerce fulfillment can include the handling and processing of returns. Without ecommerce fulfillment, there is no ecommerce. Fulfillment companies deliver what online stores sell.
What is a fulfillment company?
Fulfillment companies provide third-party logistics services required for ecommerce fulfillment. These companies typically operate from a fulfillment center and provide order fulfillment for companies selling online.
E-commerce platforms depend on fulfillment companies to provide expert services in this field in much the same way that companies outsource other activities. By taking care of fulfillment logistics, they allow ecommerce companies to concentrate their efforts and resources on their core business while entrusting fulfillment to specialists.
In additional operational efficiencies, there are also financial benefits to working with a fulfillment company. It is usually more cost effective to outsource fulfillment tasks, since you don’t need to carry the infrastructure and staffing costs associated with order fulfillment.
What services do fulfillment companies provide?
The fulfillment process involves several different services, like inventory management, returns management and domestic as well as international shipping. Fulfillment companies manage the entire process of warehousing goods, picking and packing them when they are ordered, preparing them for shipment and handing them over the couriers for delivery to the customer.
Most logistics companies offer integrations that allow you to track and monitor order statuses and access to stock levels. They can also assist you by providing the right services and standards needed for selling on certain online marketplaces, dealing with customs and tax regulations and even with your general strategy for growth.
Another especially helpful service often provided by fulfillment companies is handling and processing returns. This can even include inspecting returned items and restoring them to a resellable condition where possible.
Is working with a fulfillment company right for you?
There’s no one simple answer for everyone but, generally speaking, any ecommerce that grows beyond a certain point will benefit from working with a fulfillment company.
When an ecommerce operation is quite small, fulfilling orders doesn’t demand so much time or resources. The same small team that is responsible for other part of running the business can and often do participate in the process of preparing items for shipment, taking them to couriers, handling returns, etc.
But as an online business begins to scale up, order fulfillment demands increased time and attention, two things are often in short supply, especially at busy times for ecommerce.
Suddenly, storing, sorting, picking, packing and other steps in the fulfillment process can require its own full-time staff, something not every budget is ready for. Also, it becomes very easy to allow small delays to bring the entire operation to a halt and create serious delays in shipping times, a recipe for disaster when it comes to customer experience.
Working with a fulfillment company becomes not just a good idea but a must when an ecommerce business scales up beyond a certain point, usually around a thousand monthly shipments. Streamlining the business by focusing on sales and letting logistics experts take care of order fulfillment is the only way to keep growing.
How to choose a fulfillment company that meets your needs
When searching for a fulfillment company to supply logistics services for your online store, there are several areas that deserve special attention. These include pricing structure, warehouse standards and special features, accuracy rate, additional services offered (like processing returns and conducting inventories), proximity to your market and experience or expertise in working with products from particular fields.
Contact our sales team today to learn how you can scale up with fewer growth-related problems.
What activities does fulfillment company perform?
Fulfillment companies provide the logistics services necessary for the fulfillment of orders placed in online stores. This includes warehousing items sold online, packaging them when they are ordered and turning them over to courier companies for final delivery to the end customer. Fulfillment companies make it possible for online retailers to focus on what they do best and outsource important but non-core responsibilities to specialists.
What is a fulfillment center?
A fulfillment center is the base of operations for a fulfillment company. It usually stores goods that are ordered online and packaged appropriately for shipping to customers. Fulfillment centers provide a space for the fulfillment company to conduct its essential functions, including all stages of order fulfillment.
How to choose fulfillment company?
Different companies may need different kinds of fulfillment support depending on the nature of their product, their market and other factors. The most important questions to ask when selecting a fulfillment company that’s right for you are related to issues like facility security, shipping accuracy rate, available integrations with other tech tools, customer support and pricing plans.
How much do fulfillment services cost?
There is no one standard cost or fee for order fulfillment but there are number of factors that influence it, like the scale of your operations, the nature of your product and any special shipping requirements it may have, from how far away you are delivering to your market and more.