Is it only about the process and its’ phases, or do we name a full service with that name?
According to Wikipedia order fulfillment (in British English: order fulfilment) is in the most general sense the complete process from point of sales inquiry to delivery of a product to the customer. Sometimes order fulfillment is used to describe the narrower act of distribution or the logistics function, however, in the broader sense, it refers to the way firms respond to customer orders.
But from the other perspective having in mind the constant growth of the eCommerce market also the space for various logistic services started to expand. Here is when fulfillment is raised, evolving with its shape and range. Success in eCommerce sales is very often connected to the scale effect – you have to be ready to process more orders, implement new items, to expand into new markets.
What are typical problems companies have in the logistics process?
But there is the other side of the coin: not every company is ready to face all those operational challenges, complex processes, etc. Even if some of them are well known, and eCommerce is familiar with them, with a certain scale they may become difficult. This is a challenge, not to mention such “typical” problems as:
- Lack of resources and capacity,
- High cost of the upgrade to higher scale (tools, warehouses, etc.),
- Complicated processes, complicated integrations,
- A lot of agreements, process synchronization between many business partners,
- Lack of knowledge and much more.
It’s worth underlining that those issues arise frequently also when you start your business, being it still small, and giving an impression to be easily manageable.
What problems are solved by fulfillment companies?
One of the most popular approaches to deal with complex challenges is to find someone who knows how to do it properly, has experience and resources, and just outsource it. Here is where fulfillment comes to the rescue. It’s not only the company that will pack and ship your parcel. Very often fulfillment companies are lumped together with couriers and shipping services. Fulfillment companies take care of such areas as:
- Warehousing, inventory, stock levels,
- Orders processing,
- Picking the orders,
- All customs and other legal requirements,
- Returns management.
The range is very flexible and usually adjusted to the needs of the eCommerce player. Some would need just managing their stock levels, others need full service, from A to Z, from the moment when a customer places the order, till this one is delivered/or even returned. This last topic is a nightmare for many online retailers, so having the possibility to outsource it and receive the best service possible sounds like an ideal plan.
So what usually the fulfillment process looks like?
- Stocking – receiving the items by contracted warehouse, or in-house. If it contains sending things abroad, all the regulations have to be fulfilled and completed. The sooner all stock levels are updated correctly, the better, as customers can start ordering them online.
- Shipping the order – once the order is received in the system, the warehouse starts preparing it for immediate shipment, and this requires correct completion, appropriate packaging, labeling, and handing over to the courier company.
- Handling returns and warranties – the possibility to make an easy return is nowadays a must-be for online customers. There are a lot of studies that show how important it is to highlight the option of easy sending back the product if you’re not happy with it. Otherwise, people are very keen to abandon the basket and search for another retailer.
Is it worth outsourcing your fulfillment?
In the beginning, it may seem to be a not-necessary, additional cost, and many owners choose to handle it all by themselves. Of course, there are a lot of business types that don’t require this kind of support. Major part anyhow will face challenges mentioned above, and this is a good moment to take into consideration such topics as:
- Opportunities that can be either caught or lost, i.e. rising sale volumes, expanding the business into new markets.
- Customer satisfaction – a happy customer is one that bought your product without any problems, errors delays, and had it delivered as soon as possible
- Knowledge up-to-date – are you sure that you and your employees can have the best and fresh knowledge about all the processes, regulations, market situations and adapt to them fast? Flexibility is the key when markets start to accelerate or unexpected situations occur.
- Last but not least – optimization is a keyword and matches very well with fulfillment services.
In Linker, we are trying to optimize all the challenges every eCommerce business has and that’s why we built fulfillment network where you can start your abroad sales in any European market within 1 month. Focus on business development, sales, and providing your customers with the right level of service.
Linker will help you with managing stocks, orders, and the whole logistics process. Let’s talk at email@example.com
Take a look at how the fulfillment network works – if you have any questions, we are more than happy to help!