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The Growing Demand for Warehousing in the Ecommerce Era
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Have you been thinking about starting your own e-commerce business? Maybe you have been selling your own products for a while but you would like to branch out and look at shipping, warehousing, and fulfilment.
It’s exciting to be able to make sales, but if you are losing lots of your own time toward picking, packing and waiting in line at the post office, you are cutting into your bottom line.
The basic ways that businesses fulfil orders are as follows:
There are lots of perks to be had from fulfiling your own orders, especially when you are starting out. It’s flexible and you will save money doing your own fulfilment, at least in the beginning.
However, as your company grows, fulfiling your own orders will start to cut into the money that you can make because you are too busy shipping and packaging orders to create new products, focus on marketing, or to even run your company. If you choose to run your own warehouse, you will not be fulfiling your own order yourself, but you will have to manage employees, pay for warehouse space, and so forth.
Keeping the fulfilment process in-house is rarely the right answer, and more and more business owners are looking for ways to streamline their business model. It rarely makes sense to hire your own warehouse staff or pay for your own fulfilment automation. If major companies don’t do so, why should you?
Once your company has grown to the point where you will need to start thinking about handing off fulfilment to another source, you will need to think about third-party options for your needs. Logistics matter at this stage and you will want to be certain that you have educated yourself about the logistics involved before you embark on any kind of contract with a third-party.
In the simplest terms, this is a third-party warehouse that preps and ships out your orders. This entity is going to be linked to a fulfilment centre which helps them to control the flow of products. This model is really excellent for e-commerce brands and it can really help you to save yourself time and money.
For companies that are growing quickly, there are many great choices out there to handle their fulfilment needs. If you are looking to work with a more regional level of fulfilment service, you will probably have many local options that are a bit smaller and may have more flexibility in their contract options.
Beware of these more local providers, however, if you need to ship to a wide range of locales. Some smaller fulfilment companies will struggle to get products out to places that are far away from their home region.
Fulfilment centres are kind of like a second warehouse where you can store product to have it shipped promptly and efficiently without much effort on your part. Utilizing a larger entity’s fulfilment structure will make it easy for you to ship to a great number of places quickly.
Imagine being freed from the daily task of collecting orders and handling returns! How much more time would you have in your workday? The answer is that you would save a ton of time and a ton of frustration by outsourcing your fulfilment needs to a fulfilment service.
You are probably wondering what this will cost you. Each contract will be unique depending on the service that you are using, but usually, the charges are per unit or per hour. Sometimes they are per pallet, or some other slightly unique form of measurement.
There will also be additional costs related to bundling, returns, or customised packaging. You should make sure that you asked about all of the details of each kind of fee before you agree to sign on with a fulfilment service.
The first and possibly most important benefit of using a fulfilment service is that you will not have to do this tedious work yourself. As mentioned earlier, outsourcing this repetitive labour helps to keep the flow of products to your customers consistent, while also allowing you to do other necessary work for your brand.
Another benefit of a fulfilment service is that they typically offer flexible pricing. This means that you can adjust how much you spend on their service in conjunction with your actual shipping needs.
The only possible pitfall of ebbs and flows in your sales is that you will likely pay more for storage in the fulfilment centre’s warehouse than you would if you had kept your products at home in your own storage facility.
This issue is going to be outweighed, however, by the skills that the fulfilment centre has to offer you as a person who is running a business. You will not manage these people as they work for the fulfilment centre, and you will not have to hire them or pay them for their time like you would if you were fulfiling your own orders in your own warehouse.
Most fulfilment centres employ logistics experts who can help you to streamline your business and get the most out of your contract with them. This extra expertise would cost you additional money if you hired someone to help you to streamline your own fulfilment services, so you are basically getting this expertise for free as part of your contract with the third-party fulfilment centre.
The decision to switch to a third-party fulfilment service can be a tough one. It can feel daunting to make the change. However, there are some simple ways to identify when it is the right time to make the switch.
The biggest factor that you will want to consider is if you are experiencing fluctuating sales numbers. If you are struggling to make consistent sales, selling through a third-party fulfilment service might be a mistake for you. As mentioned before, the cost of storage in their warehouse will be higher than you might like, and you do not want to pay for services that you can’t use.
On the other side of this argument, if your product goes viral and you suddenly need to fulfil tons of orders, you might be ready to make the switch ASAP. Nothing turns a customer off quicker than not getting their item promptly.
The last red flag is if you are having trouble finding the time to fulfil orders due to your other duties. Just like in the case of a product that is suddenly under high demand, you will make your customers annoyed if you don’t get their purchase to them promptly.
The process is delightfully simple. You engage with your fulfilment service of choice and then you make sure that the service has the proper amount of inventory. Your orders are usually forwarded directly to the fulfilment centre, which takes care of the rest!
For those who are using larger fulfilment companies, the process is handled by their fulfilment centre. This makes the process even easier than if you decided to work with another third-party entity. Most of your business needs when you work with a major company, are handled through their app.
One of the best features of a logistics company is the way in which returns are streamlined. The returns will come right back to the fulfilment company and the refund request will be handled by them as well. You don’t have to do anything on your end! Best of all, if the product is still in good condition, the logistics company you are working with will ship it out to fulfil a future order.
Custom packaging might be available for an extra charge, but if this is a major part of your needs, you will need to make sure your chosen fulfilment centre can handle this for you. To find a company that can handle unique packaging needs, ask about the options they offer in advance. You can also do some research about where similar companies are having their custom packaging needs met.
Engaging with a third-party fulfilment centre is a great step to take if you are feeling burdened by shipping out your own orders, or if you are tired of running your own warehouse processes. Being freed up to have the time to create new products and to market yourself is a huge relief.
Best of all, having peace of mind that your products will be sent out in a timely fashion and that returns will be handled correctly will give you the confidence to focus on growing your business.
Are you looking for a UK based 3PL to partner with your store? Here at Rapid Pack we offer all of our clients 60 days free storage on signup. We also include the first pick within the shipping price! Wherever you're shipping to we have great and affordable courier partners to choose from too!
So if you're looking to grow your online store in 2024 and need a hand picking, packing and shipping your orders then consider choosing Rapid Pack Fulfilment ... get your free quote > HERE< Just tell us about your business. It only takes a few minutes.
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