3 Key Points to Consider When You Choose Order Fulfillment Center

Everything starts small, including e-commerce stores. Although your online store is still in its infancy, you may have to take care of most things yourself, including order fulfillment and shipping.

But, as the store grows and the customer base expands, you may need more help to help your business go to the next level when you realize that you can no longer handle everything on your own.

What is order fulfillment service?

Order fulfillment service covers the entire process from sales to delivery to customers. Successful order fulfillment depends on third-party logistics to complete the order fulfillment steps of an e-commerce online store, from receiving, processing, packaging, packing, and shipping products to customers.

A good e-commerce order fulfillment strategy is essential for online companies to maintain competitiveness and build customer loyalty.

And, what is order fulfillment center?

The order fulfillment center provides warehousing (storage) and transportation services so that online companies can conduct business without having their warehouse or storage space.

E-commerce sellers can send their inventory directly to a fulfillment center, and then deliver it to customers from there.

Most order fulfillment centers will be integrated with major online shopping platforms (such as Amazon, Shopify, eBay, etc.) to make it easier for sellers to manage inventory and deliver products.

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Why you need order fulfillment center?

One of the most obvious benefits of using a fulfillment center is that you don’t have to do everything yourself. But the benefits go far beyond that. Outsourcing order fulfillment can have a meaningful impact on the growth of your business.

Reduce rental costs

Many third-party logistics service providers offer flexible pricing. This means that as your business develops, they will be able to adjust costs accordingly to your needs. Renting a warehouse yourself involves many potential costs and considerations.

Professional solution

When you use an order fulfillment center, you not only get warehouse space, but you also have the professional services of a team responsible for operating the fulfillment center.

Each 3PL has a team composed of logistics experts and technical support personnel, who will help you all the way. You can easily implement receipt management, inventory management, order processing, and transportation operations.

Optimize customer experience

Although it is basically free for you to do this work yourself, it may actually cost you a lot of money in the long run. Customers want faster shipping time, so in-house fulfillment may cause you to fail to meet these expectations and bring a bad customer experience.

Wonderful Ecommerce Fulfillment Model Keep Your Customers

Fast! Faster! Nowadays, the development of technology makes us more and more impatient. We expect technology to make things faster, and when we have to wait, we will feel frustrated.

Almost the entire process of e-commerce order fulfillment is facing the problem of acceleration. Customers want the lowest transportation costs and the shortest delivery time.

If your product’s sales volume grows steadily, but you cannot have better technical support, then customers who add shopping carts may turn to your competitors.

However, if you can provide customers with fast delivery speed and excellent customer experience, it will help promote your orders’ continuous growth and increase brand awareness.

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How to Choose the Most Suitable Ecommerce Fulfillment Model?

Choosing the most suitable ecommerce fulfillment model is crucial because you cannot take responsibility for making mistakes. If you lose customers due to a poor fulfillment experience, they will quickly turn to your competitors for help.

A study showed that nearly 40% of customers said they would choose to return or stop shopping with retailers because of a negative delivery experience.

The perfect e-commerce fulfillment model depends on the size and nature of your business. If you are happy to do everything yourself and have the time and space to do so, then in-house fulfillment will be the best choice.

However, self-fulfillment may bring many hidden costs. For example, if you decide to sell through Amazon, remember that regardless of the fulfillment method, they will charge all sellers 15% of each product’s sales price.

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In-house fulfillment may become a burden for your business because supply chain management is not a simple matter. It needs enough space to store inventory and enough time to complete all tasks.

If you choose to work with a third-party logistics provider, then you need to take the time to screen which partner is best for your business.

It is meaningful to choose 3PL with experience and mature technology. At the same time, you should also consider price, quality control, the number of warehouses and their location, and whether the order fulfillment system seamlessly integrates with your system.

Good fulfillment companies will also handle returns management properly. Of course, you need to make sure that your budget can meet all the features you need.

How to Accelerate E-Commerce Order Fulfillment Process?

With the introduction of Amazon’s supply chain’s new fulfillment policy, you are faced with creating more innovative strategies to accelerate e-commerce order fulfillment. This is undoubtedly a huge pressure, but these strategies can optimize your e-commerce fulfillment process, speed up your business development, and bring you more income.

Appropriate strategies can help you reduce unnecessary operating costs, expand your reach while improving the customer experience, and even completely change your online retail business.

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Cooperation With A Third-Party Logistics (3PL) Provider

Please consider working with a third-party logistics provider (3PL) for support if you have many orders. 3PL can complete all order tasks, from product receiving and storage to pick and pack and transportation.

3PL service providers usually set up fulfillment centers in multiple regions, helping speed up your orders’ shipment. You can expand your resource network and continuously optimize your supply chain. One of the biggest advantages of a third-party logistics company is to cut costs. So, cooperating with 3PL providers is a good way to speed up e-commerce order fulfillment.

Optimize Warehouse Automation

Optimizing your warehouse automation can become an important part of the rapid development of your future business. Nowadays, more and more e-commerce companies continue to optimize and integrate resources to deliver products to customers ASAP. Warehouse automation minimizes human errors, reduces labor costs, and integrates warehouse management systems to maintain warehouse accuracy.

Provide Multiple Delivery Methods

To speed up order fulfillment, e-commerce operators will provide customers with multiple delivery methods. This is also a good way to maintain customer loyalty. You can combine online orders with brick-and-mortar shops to offer customers pick-up products curbside or directly to your distributions. In this way, you can reduce costs, and efficient delivery can also make your e-commerce customers more satisfied.

Conclusion

In general, speeding up e-commerce fulfillment is not only related to your e-commerce fulfillment efficiency but also related to your brand reputation. Continuously improve your customer satisfaction through these strategies to promote order volume. Satisfying customers and maintaining customer loyalty can make you invincible in the industry.

How to choose a fulfillment company?

What is a fulfillment company?

Fulfillment company usually refer to the organization that provides companies with services such as order receipts, packaging, and transportation. The functions and scope of order fulfillment are now more complex and efficient than ever before.

A technologically advanced fulfillment center can manage and simplify the fulfillment process through order fulfillment software or systems.

Outsourcing the management of the order fulfillment process to a professional fulfillment company allows companies to focus more on order growth instead of internal warehouses, inventory management, transportation, and returns.

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What kind of factors should you consider when you choose a fulfillment company?

1. Delivery speed

Now Amazon Prime has set a new two-day delivery rule, which means that consumers expect faster shipping speeds than ever before.

So, if your company’s current order volume is considerable but the order delivery speed is far behind, then your customer churn rate will gradually increase. When your company can no longer optimize the order fulfillment process, you can try to cooperate with an order fulfillment company.

Excellent and professional fulfillment companies have effective management systems and order fulfillment software, enabling them to deliver quickly.

2. The location of the distribution warehouse

The most important point of order processing outsourcing is to examine the location of the distribution warehouse of the partner company.

To meet customers’ expectations of delivering products in a short time and improve their user experience, it makes sense to choose an order fulfillment center close to the customer. For your international business, you need to confirm whether the other party provides global delivery services before cooperating with them.

To reduce the additional burden on your business and devote more time to increasing order volume, you need to study the order fulfillment system and software used by the fulfillment companies you cooperate with. Different fulfillment companies vary order fulfillment software, and you need to ensure that their software is easy to implement and can seamlessly integrate with the business platform applications you are using.

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3. Transparency

The transparency of order fulfillment is also an essential part of your corporate image. Survey data shows that 88% of consumers want to track their products in real-time. 69% of consumers said that if the merchant fails to deliver the product within the promised delivery date, they will not shop again in the future.

Therefore, when you choose an order fulfillment partner, you need to know whether it can meet the delivery time limit you require.

4.Return management

Due to the fast and convenient free return and exchange policy, about one-third of online orders are canceled orders. Some returns are uncontrollable (the customer doesn’t like the product at all). A reputable fulfillment company will manage the product well and minimize returns.

5.Cost

Your cooperation with a third-party logistics provider involves some initial costs, but in the long run, you will save labor, logistics costs, storage costs, etc. Besides, you also need to make sure that the fulfillment center you cooperate with can provide you with the best deal.

Since you have to pay for delivery services (your products are always moving after all), the delivery center should not charge you for long-term storage.

Due to the shipping volume of the shipping center, the distribution center can also get a larger discount from the operator than any single e-commerce retailer, so you want to make sure they can pass on some of the savings to you. These reduced costs often allow e-commerce retailers to compete with industry giants by offering free or reduced-price transportation.

Four Key Factors to Design a Successful Ecommerce Order Fulfillment Strategy

Designing a successful eCommerce order fulfillment strategy can be tricky because this task requires consideration of various factors in the process. You need to understand all aspects of the supply chain and provide your customers with an excellent experience after careful planning and optimization.

Here are some tips to help you design an eCommerce order fulfillment strategy to help you deliver products on time while improving customer satisfaction.

How to Design a Successful Ecommerce Order Fulfillment Strategy?

Track inventory regularly

When a customer finds that the ordered product is out of stock and not delivered in time, they may never shop in your store again, or vent their anger on social media. These consequences may not only lead to an increase in customer churn but also have a terrible impact on your brand.

Therefore, to avoid these incidents to the greatest extent, your best strategy is to simplify your order fulfillment process and deliver products to customers as quickly as possible. You need to focus on inventory and build an inventory management system. This system can help you get real-time fulfillment cycles, so you always know when products are out of stock or unavailable.

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Product Kitting

Product Kitting helps reduce the processing time and cost of order fulfillment. Product Kitting refers to the process of grouping, packaging, and supplying different but related items as a unit.

Product Kitting can increase productivity and reduce labor costs by storing products in separate kits. Besides, you can reduce inventory and improve cash flow.

Automated warehouse

Adopting an intelligent warehouse system can help you manage inventory, warehouse organization, and logistics using data-driven technology.

You can automate the warehouse by choosing to use technologies including RFID identification, the Internet of Things, and easy tracking of the inside of the IoT.

Using a warehouse management system can reduce human errors in order processing.

Transparent supply chain

Supply chain visibility is the focus of your strategy. Supply chain visibility can give you a deeper understanding of each process and improve the underperforming parts.

For example, if you track picking activities in a warehouse and find that manual picking increases time costs, you can move it to an automated process.

Therefore, you must keep track of your supply chain and collect data.

Simple Guidance For You In Order Fulfillment Cost

Different 3PL order fulfillment costs are different. When you decide to use 3PL services, you may encounter some expenses and knowledge you need to know before signing the agreement.

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Startup costs

When you decide to start with 3PL, you may encounter startup costs. This fee is used to run e-commerce services and is a worthy investment project because it helps reduce confusion when using various services.

Inventory receiving costs

A 3PL will first receive your inventory, and then begin processing and fulfilling your online store orders. Inventory receipt means that the specific conditions of inbound and outbound logistics will be taken over by 3PL. Different 3PL own different charging methods, such as per-unit, per-pallet, flat rates, or per hour.

Inventory storage costs

When your goods need to use the 3PL order fulfillment center to store inventory, you will need to pay for storage space. Storage fees range from per SKU or per unit storage to a fixed fee (for each box, shelf, or pallet used).

Order pick and pack costs

Some 3PL models include Order pick and pack costs. After the customer places an order, the fulfillment process starts picking or use the picklist to collect each ordered item from its designated storage location. Many fulfillment providers offer to charge on a per-pick basis, which means you pay for each item included in the order.

Packaging costs

Your product packaging represents your brand image. Some 3PLs will charge for packaging materials as a separate order item, while other 3PLs include them in their fulfillment services.

Kitting costs

Some 3PLs provide kits and assembly services. Kitting refers to any unique way of assembling, arranging, or packaging items before shipping. Common applications for kitting include assembling multiple SKUs during packaging or preparing inventory in a specific way. Because this service is designed for each customer, the supporting fees may vary.

Shipping costs

The last section is e-commerce shipping costs: the amount charged by 3PL to transport orders from its fulfillment center to the customer’s doorstep. Many 3PLs will work with major transportation companies to enable them to provide volume discounts to customers. Transportation costs take into account many factors, including transportation efficiency, transportation area, and product size and weight.

Challenges in Dropshipping Business

Dropshipping business is undoubtedly one of the most outstanding things brought about by the Internet and our new lifestyle. This new business model allows start-ups to run e-commerce with little resources. Here, we will discuss the seven most common challenges related to dropshipping business and how to overcome them:

Find a reliable supplier

The first major challenge most companies face in dropshipping is to find reliable suppliers. There are many manufacturers and sourcing agencies that can be your suppliers, but you need to maintain a detailed relationship with them on the same page.

You can easily find suppliers in almost any niche market of your choice. There are many resources to help you search. Make sure that the supplier you choose can meet your needs. Consider factors such as supplier fees, minimum orders, professional industry knowledge, and scalability.

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out of stock

When you start your dropshipping business, you will discover that the warehouse may be out of stock. It is one of the most common problems, and it is more common in certain product hot seasons. If you work with a very large manufacturer and order fulfilment company, you may not experience a shortage. If a product is out of stock, you must notify the customer as soon as possible, even if you find another supplier. It is recommended to cooperate with multiple suppliers.

Delay in order processing

When customers buy items from your website, they expect their order to be processed as quickly as possible. Most customers don’t understand that, in most cases, the process of processing orders is not completely under your control.

In some cases, orders that have already been placed with manufacturers will be delayed. When customers wait for the tracking code, this delay may create some tension with them. Don’t let it linger. If you haven’t received any news from the supplier within 24 hours after placing the order, please contact them to solve the problem. When these situations occur, you will at least know why the order has not been processed and how long you have to wait. Pass information to customers to appease them.

Ship to the wrong address

As embarrassing as it sounds, some orders have been shipped to the wrong or non-existent address. This is another major challenge you may face as an e-commerce entrepreneur. The best way to solve this problem is to carefully check each order address sent to the supplier.

Product return

This is something you can’t escape in e-commerce. In most cases, this is never your fault, because third parties are always involved in direct shipping. You cannot make all the rules here. Suppliers handle returns in different ways, so you must find a way to communicate clearly with customers. Your return policy is clearly stated on your website. Make all necessary efforts to make your order fulfilment proceed smoothly.

9 Questions You Should Ask Before Choosing a Chinese Dropshipping Agent

A Chinese dropshipping agent is a ‘middle man’ with a real warehouse in China, who can offer one-stop service to help you find products with the best price. Order fulfillment warehouses fulfill the order, arrange shipment, and save your time to focus on marketing.

They can also take care of high volume orders and product quality along the way. However, it is hard to find an ideal and long-term dropshipping partner. This blog will share nine questions that you can ask when contacting a Chinese agent. They’re useful to sort out the good from the bad. Ask these questions wisely, and you will get what you want.

1. Do you have a warehouse?

The real dropshipping agents is definitely have their warehouse. In other words, physical building with walls, doors, and windows. Generally speaking, they are pleased to tell you about their warehouse location and show you photos. Because they have invested a massive amount of money building and improving it every day to give you the highest quality service. You can ask them directly when considering a Chinese dropshipping company.

2. What is your processing time?

It is practical to find a dropshipping agent who can give you a definition of processing time like this:

Processing time starts from the moment a fulfillment request is received to the time that you get the tracking number of order.

Processing time is different among dropshipping agents. It’s usually anywhere between 2-3 days. The longer the processing time, the longer the shipping time.

3. How do you conduct a quality control inspection?

Dropshipping agent is responsible for checking product quality to ensure every product fits the order specifications. Once the products arrive at their warehouse, they will check their colors, size, quantity, flaws, etc. If there is any quality issue, they’ll contact suppliers to require an exchange or return.

4. Do you have product labeling and packaging?

You need to ask if a dropshipping agent will offer labeling and packaging service. For example, you can ask if they can add a logo/pattern or a thank you tag in the package.

5. What is your return policy?

It is normal to return the product in the e-commerce business. So you need to figure out the return policy in the dropshipping cooperation. The following questions count a lot in the return policy.

How do they carry out the overall return process?
In which cases do they accept to resend products or make a refund?
Whether will they cover shipping fee when resending products to customers?

6. Do you have MOQ?

MOQ is the abbreviation of minimum order quantity, which refers to the lowest number of a specific product that a dropshipping agent is willing to order and stock at their warehouse. If you cannot reach their MOQ requirement, the dropshipping agent won’t accept your request. But different dropshipping agents have different MOQs. Some may have a MOQ of 100 units while others may require you to order at least 20 units. The coolest thing is you don’t need to order one by one with a dropshipping agency. A CSV file can easily be applied to save your time.

7. Do you provide inventory data updates?

If you’ve got an order from your customer and transfer it to your dropshipping agent. Unfortunately, they tell you that it’s out of stock, which is the worst case you should be aware of at the beginning. In order to avoid this problem, you should ask the agent if they provide you inventory status and how often the data will be updated, especially during holidays like Chinese New Year and Christmas. In this way, you can make plans to order more products early.

8. What’s the service charge?

In most cases, dropshipping agents don’t use a fixed cost. The cost often depends on types of products. But all the fees should be visible and transparent. A responsible dropshipping company only charge a very reasonable service fee without any hidden costs or commissions.

9. How to contact you if I have questions?

Your dropshipping agent should be present (almost) whenever you need their help. Compared to email, the instant communication channels(like WeChat, Skype, WhatsApp, etc.) is more effective and convenient. So you can make sure if they can provide some instant communication choice for you.

How to Protect Shelves in Order Fulfillment Warehouse?

With the rapid development of the e-commerce industry, storage shelves have been widely used in many order fulfillment warehouses, but few people pay attention to shelves maintaining. So today we will share the importance points of maintaining storage shelves.

Reasonable use

The storage shelves must strictly follow their internal parameters to place items. Too heavy goods will seriously affect the shelf lifetime.

Regular cleaning

In most cases, few staff will pay attention to the cleaning of shelves. Most of them will approach the shelves only when they need certain goods, and then leave quickly, which will accumulate a lot of dust on the shelves, undoubtedly, it will affect the goods on the shelf, and at the same time, it will also have a certain impact on the life of the storage shelf.

Regular cleaning of shelves can extend shelf life. The cleaning of bookshelves is not always cleaned with water. Remove the dust from the shelf. If the shelf is washed with water, it is easy to oxidize the shelf surface, shortening the shelf life greatly.

Load-bearing capacity

When placing goods, you need to pay attention to the load-bearing capacity of the shelf and avoid overweight. Place lighter goods on the upper floor and heavier ones on the lower floor to avoid safety accidents.

Keep the warehouse dry and ventilated

Storage shelves need to be painted with protective paint on a regular basis to avoid corrosion. Do daily inspections, fix the loose screws in time, ventilate the warehouse, keep the warehouse dry, and avoid excessive humidity.

Develop specifications for the use of storage shelves

Warehouse managers need to formulate specifications for the use of storage shelves, cultivate the awareness of protecting shelves while improving the standardization of storage operations.

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What can e-commerce Sellers Learn from WalMart ’s Biggest Revenue Surprise?

Recently, Wal-Mart announced its biggest revenue surprise in 31 years. As consumers poured into Wal-Mart to consume, its online sales almost doubled during the coronavirus pandemic.

During COVID-19, the discount retailer used its large store base and investment in e-commerce to provide customers with food and other goods. In the second quarter, US same-store sales increased by 9.3% while US e-commerce sales soared 97%. This is because more and more customers tend to use same-day delivery and curbside pickup services.

Wal-Mart’s CEO Doug McMillon (Doug McMillon) said the company will expand these benefits by adding member services. He did not disclose when it was launched, nor did he provide details about the privileges. He only stated that the project will pick up goods by the roadside and speed up the delivery of customers, strengthen the relationship with customers, and collect valuable data. What’s more, It is reported that the program called “Wal-Mart+” is expected to compete with Amazon Prime.

Whether you are an Amazon seller or an Shopify entrepreneur, the most significant thing for your business is to find an effective order fulfillment agent. Like ChinaDivision, a leading order fulfillment company in China.