Four important criteria for choosing a warehousing service plan

Warehouse operations and management contain many important factors. When choosing and researching a warehousing service plan, be sure to carefully consider the following aspects to find a solution that suits you.

Factors Considered in Warehousing Service Plan

  1. SKU quantity & storage cost

Track inventory, calculate potential storage costs, and the size of the warehouse space required, SKU can help you a lot in these parts. For example, for each cup you sell, the color, size, style, etc. of the quilt require a separate storage unit. And you need to pay a separate storage fee for each of these variants.

If your product has only a few SKUs, the storage cost is much more cost-effective than having 1,000 SKUs. Moreover, suppose you have 1000 SKUs but only 1500 monthly sales volume, then some companies may not be able to cooperate with you.

It depends on how order fulfillment companies work-they don’t exist as standalone warehousing service plans. Their goal is to transfer inventory through order fulfillment. This means that you can frequently replenish inventory to meet sales needs without paying high storage and logistics costs.

warehousing-service-plan丨BigRentz丨ChinaDivision
warehousing-service-plan丨BigRentz丨ChinaDivision
  1. Seasonal changes

The demand for products fluctuates with the change of seasons, making warehousing and logistics more complicated. You need to pay attention to the sales of your products in the off-season to avoid unnecessary expenses caused by excessive inventory occupying warehouse space.

  1. Warehouse location

The choice of warehouse location depends on your marketing strategy plan. If your goal is to store a large number of products, you can find warehouses in the suburbs or near transportation hubs. If you want to deliver orders to your customers as soon as possible, you need to place a warehouse near the customer’s shipping destination.

Warehouses in urban or large cities can meet your needs for fast delivery of large quantities of orders. Shortening the logistics distance and time can speed up transportation. If your customers are not all in one area, please carefully select one or more suitable central warehouses.

  1. Warehouse Management System

Whether you plan to manage your warehouse or outsource logistics to a 3PL company, the technology of warehouse management and operation is crucial. The distribution software can automatically execute the order fulfillment process while concentrating orders, shipments, inventory levels, fulfillment centers, and customers in one place.

By connecting your sales channels, the order information will be automatically sent to the warehouse so that warehouse employees can start picking. Each step is recorded and tracking information is sent back to the customer.

Will Automated Warehousing Replace Order Fulfillment Company?

With the advancement of modern automation, automatic warehousing equipment has gradually entered people’s attention, especially e-commerce warehouses. It can be said that the rise of modern e-commerce warehousing outsourcing services must be inseparable from the assistance of warehousing automation equipment. However, in the modern era of rapid scientific and technological progress, automated warehousing will be an inevitable choice in the future. So is it necessary to find a third-party logistics services? Will e-commerce order fulfillment warehouse be replaced?

On the one hand, with the widespread popularity of automated storage and equipment, the price cost is still unaffordable to many e-commerce sellers. Especially for small and medium-sized sellers, under the premise of small shipments, spending a lot of money to buy automated storage will only increase unwarranted consumption. In fact, the better choice is the e-commerce warehousing outsourcing service. Under the urging of the times, the third-party warehouse must be equipped with various types of automatic equipment, which will be better than self-built automated warehousing. Higher delivery efficiency and  more favorable price can help small and medium-sized companies better meet the challenges of the wave of automation.

On the other hand, most e-commerce sellers will adopt the principle of proximity when building their own warehouses, that is to say, the want to set up warehouses in areas close to their own companies to facilitate supervision. Then this will inevitably lead to the problem of low timeliness of delivery. But the third-party e-commerce warehouses are all located near the express distribution center, which has a considerable advantage in terms of timeliness of delivery. With the ultra-high accuracy of automated warehousing, it can greatly improve the timeliness of logistics and the accuracy of delivery.

What will Happen to Drop Shipping in the Future?

Over the past decade, many Chinese drop shipping agents had embraced incredible success on account of lower shipping costs and better capability. Unfortunately, COVID-19 had a ripple effect on drop shipping agent and cross-border e-commerce companies, which caused a heated discussion about what will happen to the drop shipping business in the future.

Back to 2018, American President Trump announced that the United States was pulling out of the intergovernmental body called the Universal Postal Union after claiming that China has been taking advantage of the US. One year later, UPU announced that it reached a deal with the US and it approved President Trump’s request to collect higher fees on packages from international destinations. The agreement will go into effect on July 1, 2020 and American sellers can expect significantly hiked prices on their products. Basically, ePacket, a shipping option offered by Chinese and Hongkong merchants when shopping on popular Chinese marketplaces like Aliexpress, will no longer be price competitive and many American independent sellers will, if not go out of business, dramatically lose revenue.

But it is a fact that China is the world’s largest manufacturing country and a titan in the global exporting industry. According to statistics, China had assisted over 18 countries in the work of epidemic (South Korea, Italy, Japan, Iran, Pakistan, etc). Apart from sending medical teams, China also donated $20 million to the WHO, as well as masks, medicines, protective suits and other epidemic prevention materials to relevant countries. From the data, we can figure out the capability of Chinese Government, and so do the drop shippers. The local quarantine agency said Chinese outbreak appeared to be well contained, so there will be adequate staff in the order fulfillment center to achieve fast warehousing, packing and shipping.

In brief, Chinese drop shipping is the trend of e-commerce in the future, your business can be booming with the help of drop shipping agency.

Three Reasons of Fulfillment Centers Start a Business in Shenzhen

As a cross-border e-commerce entrepreneur, you will be surrounded by many choices when finding the warehouse address. However, you will take many detours on the way to your cheapest fulfillment service. What’s worse, some Amazon sellers have been very confused about global ecommerce fulfillment owing to the Amazon warehouse fire and COVID-19.

To tell you the truth, Shenzhen warehouse plays an inportant role in the international orfer fulfillment. A latest study concerning Chinese warehouse location indicated that 75% warehouses come from Shenzhen. Here we have summarized three reasons as shown below:

As you can check in Google Maps, Shenzhen is near the international parcel processing centre——Hongkong, which provides more convenience for picking, packing and shipping. Take Amazon ePacket tracking as an example, Shenzhen warehouse can sent the items directly if your customer has ordered successfully from your webstore. That is to say, you don’t need to manage your own warehouse or distribution center.

Shenzhen is the birthplace of China’s reform and opening up, where many foreign trade enterprises and drop-shippers had been created. So they have more experience in the field of warehousing and shipping for e-commerce, and it is hard to find disorderly shipping and wrong delivery. In this way, you can reduce business risk and increase customer satisfacton.

During COVID-19 pandemic, the majority of e-commerce sellers want continuous selling on AliExpress, eBay and Amazon. Therefore, it is essential to reduce the chance of infection with COVID-19, whether it is warehouse or transportation staff. The number of people diagnosed in Shenzhen is cleared on May 21. Additionally, the government insists on strict pandemic prevention work, requiring everyone in Shenzhen to measure body temperature every day, especially warehouses and catering staff, mask wearing and hand washing are indispensable work.

All in all, you can get a fully automated with less money and time if you choose the most suitable order fulfillment center, and Shenzhen is a competitive choice.