According to an article published in The Times of India, on-demand fulfillment solutions have seen rapid growth post the pandemic and it is likely to prevail in the long run. In fact, as more sellers enter the eCommerce space and look for cost-effective solutions, the need for on-demand warehousing will grow further.
Already, the increasing demand for product delivery in the shortest possible time has urged eCommerce sellers to invest in fulfillment solutions. These services include warehousing, packing, shipping, and other value-added services like return order management and urgent deliveries. A fulfillment service solution is ideal for eCommerce sellers to manage inventory and aim for fast shipment.
Looking at the paramount importance of warehouse fulfillment solutions for the success of businesses that sell a physical product, we have come up with detailed information about the eCommerce fulfillment solutions.
Before we discuss in detail the importance of eCommerce fulfillment solutions, let us first understand what fulfillment is.
Fulfillment is the process of receiving, storing and managing inventory before an order is placed. Once an order is placed, the fulfillment service provider is responsible for picking, packing, and shipping orders.
Read on to know all about eCommerce fulfillment solutions here.
What is eCommerce Order Fulfillment?
The role of eCommerce order fulfillment begins as soon as customers start buying products through the eCommerce website, and it continues until the product is successfully delivered to customers. Processes involved between the order placement and delivery of products to customers’ doorsteps include
- Reverse shipment (in case of an exchange or return order)
Even before looking for warehouse fulfillment solutions for eCommerce, businesses must define their requirements and budget on inventory management.
A reliable and effective eCommerce order fulfillment solution backed by fast delivery and efficient return order management helps earn customers’ trust while helping online sellers expand their business.
Now that the concept of eCommerce order fulfillment is clear, explore its services, processes, how to choose the right fulfillment service provider, and more here.
What are eCommerce Fulfillment Services?
It’s no surprise that customers who buy products online love fast delivery. eCommerce sellers understand the need of customers and hence they are willing to provide the fastest delivery by improvising their logistics services. Those who need to manage bulk orders require reliable and fast shipping for which they depend on warehouse fulfillment solutions.
A reliable fulfillment service is a necessity for eCommerce. No matter how good the quality of the product and its demand in the marketplace, the products sold online must reach the customers on time and in good condition. Fast delivery service is an additional advantage for eCommerce.
eCommerce sellers tend to collaborate with an eCommerce fulfillment service provider to ensure fast delivery. They help them access warehouses located at the nearest place to customers. This ensures fast delivery of products whenever the order is from a place nearest to the warehouse.
What is the eCommerce Warehouse Fulfillment Process?
The eCommerce fulfillment process combines various operations to ensure that the business requirements are fulfilled. Know multiple operations involved in the eCommerce fulfillment process here:
1. Receive inventory
The first process in an eCommerce fulfillment warehouse is to get the products at the distribution center. This step of the fulfillment process is known as receiving inventory.
Businesses that use a third-party fulfillment service must handle pick-up products in the right way before shipping them to the warehouse. This helps speed up the process of shipment to customers.
2. Store inventory
Another important process in eCommerce warehouse fulfillment is inventory storage. Businesses that have high orders must have enough inventory to meet the demand.
A third-party fulfillment service is accessible at multiple locations, hence it is a preferred service by most businesses. The warehouse fulfillment solution must be effectively managed to enhance the efficiency of fulfillment solutions. Say, each product stored in the warehouse should have a Stock Keeping Unit (SKU) code to identify and manage inventory.
3. Process orders
As soon as a customer places an order on an eCommerce website, the order processing starts. Staff at the fulfillment warehouse pick the right items from the inventory and place them in the container. The package is appropriately packed along with the packaging slips.
Important factors that should be considered in the order processing process are:
- Quick response by the fulfillment service provider
- Accuracy in picking orders from storage
- Right packaging
4. Ship orders
Once the order is picked and packed, the third-party fulfillment service providers then ship the order to customers. The package is moved from the warehouse to courier hubs, from where it is further shipped to the customer’s delivery address. There should be no damage or tampering with the package. Delays have to be avoided at any cost, and all orders must be delivered on time.
5. Return orders
A successful eCommerce shipment is not only about delivering the right products on time, but it is also about managing return orders. To handle return orders, reverse logistics comes into the picture. Reverse logistics is the set of operations that involve the return of a product from the customer back to a location of the warehouse or the seller’s preferred location.
eCommerce warehouse fulfillment service providers handle return orders by receiving, accessing, and processing return orders back into the stock. Return orders involve extra procedures like inspection of return orders, placing the product back in the inventory, updating the same to sellers, and more.
Effective reverse logistics and warehouse management helps in managing the return order effectively.
eCommerce Warehouse Fulfillment Models
Businesses come in various shapes and sizes and so do their logistics needs. Be it fewer orders or bulk orders, there is a need for warehousing solutions to keep stock of items. Different types of eCommerce warehouse fulfillment models are implemented as per the requirement of businesses based on their size and operations.
Broadly there are three options through which fulfillment services are fulfilled by businesses that sell physical products. It includes in-house fulfillment, third-party fulfillment and dropshipping.
Know the difference between all the three models here:
In-house Order Fulfillment
Also known as self-order fulfillment, is a fulfillment model in which the eCommerce sellers handle the entire process by themselves. There is no involvement of third parties or dropshippers.
It is an ideal model for small businesses where orders are low. A number of eCommerce sellers who own small businesses implement in-house fulfillment as it is a cost-effective and absolute solution for them.
Find out the benefits and limitations of in-house order fulfillment solutions here:
- Ideal model for small businesses
- No dependency on the third party
- Cost-effective fulfillment model
- Less complex fulfillment solution
- Better management
- Not an ideal model for bulk orders
- Time-consuming model
- Space management
- Workforce required for inventory management
- Implement order fulfillment software
eCommerce sellers who receive orders in bulk require sophisticated warehousing fulfillment solutions for their orders. Managing in-house warehouse fulfillment solutions for bulk orders can be very complex and challenging for businesses. Managing different processes of warehouse fulfillment service is quite tedious and time consuming. Hence, they depend on third- party warehousing fulfillment solutions. Know how the end-to-end warehousing solution from a third party can be useful for your eCommerce business. Also, check the limitations of third- party fulfillment services here:
- An effective model for bulk orders
- Connect with multiple courier service providers
- Fast shipment
- Flexibility and scalability to utilize resources as per business needs
- Challenge in connecting with a reliable fulfillment service provider.
- The service provider can either add value to their business or they prove just the opposite. The standard and quality of service can be compromised, if not connected with a reliable fulfillment service provider
Dropshipping is a fulfillment method in which the eCommerce store owner does not keep the product in stock but only sells the product. In this mode, the store owner purchases items from the manufacturer and ships them directly to the customer. Hence, manufacturing, as well as shipping, is outsourced in the dropshipping model.
Dropshipping and retailing are not similar methods of order fulfillment. In the traditional retail model, the merchant does not own the inventory. In the case of dropshipping, the sellers connect with a third party for a fulfillment solution.
Know the benefits and limitations of dropshipping here:
- Easy to Set-Up. Retailers can show presence on the eCommerce store without worrying about the targets in terms of product to sell.
- Can demand products from manufacturers only when there is a sale.
- No need to manage the packaging and solution with the involvement of third-party fulfillment service providers.
- Less risk involved. As retailers need not buy products from the manufacturer until a sale is made.
- Can avail in-demand inventory solutions once they receive orders
- More focus on sales, as manufacturing and shipping are outsourced
- Less Capital Investment
- No Geographical Constraints, can start anywhere online and connect remotely with suppliers and fulfillment service providers.
- Highly competitive. Since the investment is low, any competitor can set a low margin on products to increase their revenue
- Supplier Issues. The online retailer may be successful in generating high sales but suppliers may fail to provide the right service.
- Sometimes, suppliers intend to dispatch products late, provide low packaging or misplace items. In such a case, the reputation of the eCommerce seller is impacted negatively.
- Shipping Complexity. For multiple orders, eCommerce retailers need to connect with different drop shippers.
- Possibility of complications in collaboration with shipping partners and also in defining the shipping cost.
How to Choose an eCommerce Fulfillment Provider?
As discussed in the above section of the blog, the eCommerce fulfillment need varies depending on the business goals and requirements. It is important for eCommerce sellers to choose the service judiciously, as it adds cost to their business and at the same time can impact the delivery speed and revenue of their business. Here we have come up with certain guidelines that can help eCommerce sellers choose the most suitable eCommerce fulfillment providers for themselves:
1. Plan Your Order Fulfillment Strategy
For successful eCommerce order fulfillment solutions, businesses must define and execute an effective plan. Good planning is required to access a secure and reliable infrastructure, space and staff to manage inventory. Here are few important things to consider when planning order fulfillment strategy for a business:
- Choose your location wisely: The location of the fulfillment center plays a significant role in meeting the expectations in eCommerce. The closer the fulfillment center is, the faster the delivery service would be. If possible, access a fulfillment center at a location from where maximum orders are received. In doing so you can ensure fast dispatchment of the product as soon as an order is placed.
- Optimize fulfillment operations: eCommerce fulfillment solutions should fulfill both affordability and fast delivery requirements of online sellers. To ensure both, the fulfillment operations must be optimized based on the requirements of the business. Say, the space must be utilized effectively to manage cost on inventory. Also, the staff must be ready to dispatch products on time.
- Implement technology: eCommerce sellers who require 3rd party fulfillment solutions can integrate the eCommerce store on the logistics service providers’ platform. In this way, they can sync orders and also access warehousing solutions directly from them.
Know how you can integrate the eCommerce store with Pickrr’s dashboard in the link given below:
2. Opt In-house Fulfillment Model
If you own an eCommerce store and wish to manage the entire fulfillment service on your own then the in-house fulfillment model is best for you. However, if you manage the entire fulfillment service on your own you must ensure to have enough resources in terms of personnel, software, tools, space etc. to handle the entire process effectively.
3. Choose a Third-party Fulfillment Model
In the case of the in-house fulfillment model, meeting customers’ orders becomes quite infeasible as businesses need to manage orders in bulk. In such a situation, the third-party fulfillment model serves best to businesses. Undoubtedly, a third-party fulfillment model is ideal for eCommerce that has a good number of orders to handle.
Now, the question arises how to choose the right third-party fulfillment provider for your business? Well, there are multiple parameters that you must consider when making a decision.
- Look for cost-effective, reliable and transparent fulfillment solutions.
- Also, check the type of service that is offered by the third party fulfillment service provider and one that can add value to your business.
Why is eCommerce Fulfillment Important?
Know how an apt eCommerce fulfillment solution is important for your business:
- Firstly, businesses with high order processing capacity require a warehousing fulfillment solution to store and manage stock items. Order fulfillment is completed in phases. Before packing and shipping products to customers, businesses must prioritize inventory management. This is possible through an effective eCommerce fulfillment solution.
- With online purchasing comes a lot of expectations from the customers. Along with the quality and right product, customers also expect delivery as earliest as possible. For fast delivery, businesses must invest in suitable fulfillment services and collaborate with the right shipment service provider.
- Businesses can choose the fulfillment centers that are closest to their customers. They can keep stock items at warehouses at locations from where they receive maximum orders. Doing this can help them ship products as soon as an order is placed and ensure the fastest delivery to customers.
- Undoubtedly, customers love fast delivery. By offering fast delivery, eCommerce businesses can enhance customers satisfaction. For fast delivery, businesses must invest in the best fulfillment service solution. Customers tend to reorder from an eCommerce site that guarantees fast delivery. Eventually, the eCommerce fulfillment solutions help in improvising sales and retaining customers.
Pickrr’s eCommerce Fulfillment Solutions
Pickrr Plus Fulfillment is a tech-enabled fulfillment solution that helps online businesses and brands with their last-mile logistics needs. Its warehouse fulfillment solutions are available across pan-India. Businesses that own eCommerce stores can access warehouses at a location that is nearest to their target customers. Doing this can help them ensure fast delivery.
Here’s how Pickrr Plus Fulfillment helps you streamline your shipping:
- Offer 3x faster delivery
- Reduce RTO by up to 5%
- Save on shipping costs by up to 35%
Sign up with Pickrr and avail multiple logistics services. Integrate your eCommerce store with Pickrr’s dashboard to synchronize your orders. Avail warehouse fulfillment solutions as per the requirement of your business.