9 Tips When Choosing An Ecommerce Fulfillment Company
These are the bare minimums that you need to have in mind when you are looking for the right E-commerce fulfillment partner for your business. As more and more companies of this type are in business, the market space can get quite crowded in every niche.
This means that your fulfillment processes are one of the places where your business can shine and stand out from the crowd. This also means that you need to find the right business partner for this work to ensure your business's health and longevity.
1. Shipping Speeds
This is probably the biggest factor that you should use to determine which e-commerce fulfillment company you want to work with. Amazon’s rapid fulfillment processes have become industry standard these days, and consumers expect this kind of turnaround on orders that are shipped to them.
Already in 2018, Amazon was one of the top marketplace and fulfillment services used all around the world. In the US alone, nearly 73% of sellers in the e-commerce space were using Amazon for their fulfillment processes.
When 2-day shipping is the norm, you cannot even consider for a moment a contract that will cause shipping to take more than a few days. While this would have been an unimaginably fast turnaround time five years ago, today, this rapid shipping is the expectation that all consumers have.
When you cannot ship to your customers with rapidity, you start out behind the 8-ball when it comes to customer satisfaction. If you are already not meeting the customer’s shipping turnaround expectations, and then the product gets damaged in the mail or does not meet their expectations for some reason, you are probably in for a negative review.
These kinds of considerations need to be thought about when you are shopping for a fulfillment company since reputation is such a huge factor in online business management.
Customers that are able to get shipping faster will leave you behind to work with a company that will get them their orders right away. This is just a fact and one of the reasons that you do not want to be left behind the times.
If you are looking for a quality e-commerce fulfillment company, the shipping times that they offer will need to be at the very top of your list of considerations.
2. Location of Warehouses for Fulfillment
The consideration that you need to have in mind next goes hand-in-hand with the turnaround times on shipping. The locations of the fulfillment center’s warehouses can have a big impact on shipping times as well as shipping processes that you might be able to access.
The closer that the fulfillment center is to the customer, the better. You will also benefit, as the seller, from access to lower shipping costs because of the fulfillment center location.
Fulfillment companies usually have many warehouses that they use to ship orders from, and these companies should be sending your orders to be fulfilled at the closest warehouse to each customer.
This was not the way that e-commerce fulfillment worked back in the day, but it is pretty much a must-have feature today.
If you are not sure that you are going to be able to benefit from having items shipped from various different fulfillment warehouses, you will need to think long and hard about creating a contractual relationship with the company in question.
If you need to sell worldwide, this conversation is even more important. You should not choose to work with a company that does not offer quality global shipping, and you will want to ask about their processes to ship to locations all around the world without breaking the bank on postage or making customers suffer through long waits for their order to arrive.
3. Customizable Features
Once upon a time, you couldn’t customize any of the parts of your fulfillment contract with a company. You just accepted the contract or didn’t accept it.
Things have come a long way since then, and most fulfillment companies offer a wide array of options that you pick and choose from to get the most from your shipping agreement with them. If the company that you are checking out does not offer any custom features, this could be a red flag.
You might be wondering what some of these perks might be, and that’s a fair question. You might not be eligible for all of the benefits that each company offers, but there is a chance that you could customize your service in a whole host of useful ways.
Most companies offer fulfillment software or a fulfillment site that you can use to check on order status, verify returns, and check on the amount of inventory that you have at each fulfillment location
You might also be able to create custom packaging and custom ordering timelines for your products. There are many ways to make your fulfillment service completely unique, and you should be sure that you explore these possibilities thoroughly before you make any assumptions about what you are getting out of the deal.
At a minimum, you should ask about specialty packing, shipping, and labeling processes, and you might want to ask if you can customize the returns process as well.
Making the process of shipping easier is always the goal of quality fulfillment companies, and working with a business that does not offer any custom options can be a big problem for your business workflows.
4. Transparency and Good Communication
You will work hand-in-hand with your fulfillment company, and you need to be sure that you can reach out to them when you need to ask a question or deal with an order that might be having issues.
The company that you select for your fulfillment work needs to be readily available, and they should also offer up a rep or a specific point of contact that you can use to have trouble or questions resolved promptly.
As we talked about before, the customers that purchase items from you will be satisfied with their order, in part, due to the quality of the shipping part of the purchase.
This means that you can’t just set it and forget it when it comes to shipping and handling. Fulfillment companies need to handle a wide array of shipping processes every day, and things can sometimes go wrong. This is why communication is so key.
Integration software or a website that details order processes and shipping processes can also be a key part of the communication between you and your fulfillment company. The more that you can see and interact with the work that the fulfillment company is doing for you, the better off you will be.
Companies that handle fulfillment should be sure that they work with you to create the fulfillment agreement that suits your business style the best.
You should not have to guess what you will be offered, and you should not need to call the company many times to be able to find out what is going on with supplies, returns, or orders shipped.
Communication is one of the items that should be at the top of your list of concerns, no matter how well-rated the fulfillment company is that you are trying to work with.
5. Branding Considerations
Your company needs to stand out from other companies in your niche, and part of the way that you do this is through branding. Branding can impact your social media presence, your company website, and also your packaging and shipping processes.
Many companies have specific boxes with specific kinds of internal packaging that need to be sent out with each order to preserve their branding style.
You should always ask companies that are going to handle your fulfillment processes if they can work with you in regard to your branding. There are going to be some limitations for certain companies related to packaging styling, and you do not want to create a contract with a company that cannot actually ship out your products in the right packaging.
This is a more common issue than you might think, and many businesses run into this issue after they have already begun working with a fulfillment business.
Always be sure that the branded packaging and the branded interior packing of your boxes and shipped items are clearly stated when you are thinking about working with a business that handles fulfillment services.
It might be possible to meet in the middle and find a solution that works for everyone, but you will not know if you just assume that things will be fine and then end up really frustrated when they are not fine.
The statistics don’t lie: 81% of consumers need to trust a brand before they even consider buying from the business. Imagine how much damage is done to your business image if the customer had a mental image of the kind of packaging that you were going to use to send your products out and they get a basic box with nothing on it stating anything about your brand?
We all know how exciting it is to open a package and see branded boxes and bags inside. You want to be sure that you can preserve this magic for everyone who buys a product from your company.
6. Packaging Options
This topic is related to the topic above, and we have already touched on this a bit. You should always be sure that you ask about the kinds of products that they are using to ship out your orders.
You might be shocked at the low quality of the usual shipping bags and boxes that are used by many fulfillment centers. For some kinds of products, this simply won’t cut it.
Fulfillment centers should be able to provide proof of the kinds of packaging that they use and what they do as far as protecting fragile items. Making sure that you don’t have a high number of returns for damaged products is key to your business success, business reputation, and your bottom dollar.
This needs to be one of the first conversations that you have when interviewing fulfillment companies to ensure that you will be able to find the right business to take care of your shipping needs.
7. Return Management
Fulfillment centers spend a lot of time handling returns for their clients. No matter how amazing your product is, sometimes people will send it back.
You will also need to attend to a certain amount of broken merchandise every year that is damaged in shipping through no fault of you or the fulfillment center. These returns can be a big burden to your business if you are not working with a skilled and effective fulfillment center.
This is one of the key aspects of the benefits that you get from working with a fulfillment center. This business will handle all of your returns and save you lots of time and energy. They will also usually take the time to notify you about those who are “serial returners” who buy products over and over and return them over and over again.
Being able to work out why items are being returned or denied business to people who are not willing to actually keep the products that you send to them is important for your bottom line.
In 2021, return rates increased exponentially as more and more people began to shop online. The current average percentage in the US for returns of products to e-commerce companies is 16.6%.
There are often lots of factors that cause returns, and you need to be able to look at the metrics related to the return reasons to be sure that you have a handle on why your business is experiencing returns at this rate.
This is something that a quality fulfillment company will offer you and you should be able to access information about your rate of returns whenever you desire to look at this factor related to your business’s bottom line.
8. The Cost of the Relationship
This is a big one for many e-commerce companies, and the cost of working with a quality fulfillment entity can lead e-commerce businesses to make the mistake of cutting corners when they pick a fulfillment partner. This is arguably one of the areas where you need to be willing to spend the most since this is such a key aspect of running a successful business.
E-commerce businesses need to remember that the fulfillment company might seem expensive when you look at the monthly cost, but you are going to be saving exponentially on the labor and time that it takes to deal with returns.
You will also benefit from saving money on long-term storage or warehouse space. This is a huge commitment for companies that work in the e-commerce space, and the fulfillment center will handle this cost for you as part of your contractual relationship.
Fulfillment centers often also get much better shipping rates than you would as a business owner. This is a big benefit to working with a fulfillment business and you should not forget that this cost alone might make the relationship so valuable that you cannot operate your company without it.
When you are looking at the various options out there to pick the right fulfillment company for your needs, always be sure that you know the cost of doing all the work to manage your e-commerce business yourself. If you have the total cost in mind, you can more accurately assess what is a reasonable cost for this kind of partnership.
Cutting corners here can mean cutting back on the amount of product that you sell and also impacting the reputation of your business negatively.
You should be sure that you are prepared for the possible repercussions to your business if you opt to work with a fulfillment center that cannot meet the two-day shipping expectations of most customers and does not offer some of the benefits that we have discussed in this article.
There is no reason to choose to cut corners with regard to this important half of your business operations, especially if you want your e-commerce company to thrive.
This is another factor that can be increasingly important to modern businesses that are selling products online. Consumers are well-versed in how the process of shipping and fulfillment works these days, and they might actually be savvy enough to do their research before they buy from you.
When potential customers see that you are working with a fulfillment entity that they have had a problem with in the past, they might choose to buy elsewhere.
Fulfillment companies used to work in the background, silently delivering products to consumers while the face of the business took the blame for any issues with the product or shipping. This is no longer the case.
There is a good reason that many companies opt to work with Amazon for their fulfillment needs these days, and that reason is often linked mostly to reputation. You should be wary of selecting a contract that comes along with a company’s bad reputation, even if they seem to be offering you a great deal and a lot of perks.
Reputation is everything when it comes to online businesses, and you do not want to impact the consumer impression of your business negatively by proxy. Always make sure that you think about this detail when you are considering which fulfillment company you want to work with for your business needs.
Also, consider that the reputation of the fulfillment entity is negative because they are not good at their job. This could spell disaster for your business in a variety of ways beyond simple online gossip.
Selecting the Right E-commerce Fulfillment Company Matters
There are few decisions that you need to make related to managing your e-commerce business that are as important as picking the right fulfillment company.
There are so many factors that are controlled by the fulfillment process that you should not cut corners with this part of your business planning. You need to be sure that your customers will get what they ordered promptly and that the products will arrive in the right kind of packaging and undamaged.
Working with a skilled fulfillment company can save you money, time, and worries about customer satisfaction on a daily basis. Always make sure that you consider these essentials that any fulfillment company should offer before you determine which company is the best fit for your needs.
Picking just based on saving money on your contract or based upon a single factor listed above might lead to a relationship with a fulfillment center that is not right for your needs.
This is a critical decision that directly impacts the success of your e-commerce business, and you should be sure that you think about all of the various details before you select the fulfillment company that you want to work with.