Order fulfillment services are third-party vendors that fulfil orders for other companies such as online sellers, eCommerce or even brick-and-mortar stores that do not possess warehouse and distribution facilities. The service helps reduce infrastructure and logistical costs as well as improve operational efficiency of merchants and retailing businesses. Essentially, order fulfillment services provide receiving, processing and delivery services on behalf of a client company. This service extends to a wide array of transactions, ranging from large business-to-business to individual direct-to-consumer orders. For many companies, it is with fulfillment service providers that they are able to go about moving, storing and delivering their goods to their customers.
For eCommerce or online merchants, fulfillment is a big task and responsibility as it involves time–consuming and resource-intensive tasks that include taking orders, packaging, processing payment to shipment and delivery. Add to these the hassles of complying with regulatory requirements, and handling returns, all of which will require your undivided attention. There are a thousand and one chores that you may not have time to handle. The fact is sourcing, marketing and selling are only half of the equation in an online business, the other half is getting your product to customers. The challenge with fulfillment is that the more customers and orders you get the more complicated logistics becomes. A fulfillment service takes care of those.
The benefits of using a third party fulfilment house
Order fulfilment companies have gained real prominence especially in recent times with the rise of so many online start-ups and fast growing small and medium sized companies. These businesses either do not have the infrastructure and logistics facilities or they find the costs of having their own infrastructure prohibitive. Even well-established sizeable businesses tend to lean towards the use of a third party fulfillment Company due to the numerous advantages it provides which includes the following:
- Lower shipping costs. - Order fulfillment companies which have a regional, national and international infrastructure can normally offer bulk delivery discounts which you can take advantage of. Having distribution and warehouse facilities strategically located both Nationally and Internationally gives fulfillment service providers the scope and economic feasibility to offer lower shipping rates.
- Reduce operating costs. - Seasonal fluctuations when you experience flat sales or peak seasons when there is full rush to deliver increased sales won’t much affect your bottom line or cost of inventory because you pay the same rent and storage expenses. Compare that when you go on your own still paying workers and storage fees even during dull sales periods. Economies of scale and pay per use come to fore as practical options with fulfillment services.
- Extend your reach. - Whether an order is National or International you’re ready to take your business to the next level – globally. Fulfillment companies can ship and deliver to any part of the world because they have logistics and distribution networks to do just that, and you are harnessing their global platform to extend your reach and grow new markets.
- Improve customer service. - Integral to fulfilling orders is a reliable customer support service that includes an easy return policy and most order fulfillment companies offer this. Customer support is provided by them through either email or phone, and sometimes wish in multiple languages. In addition, you may not have the means to do reverse logistics when customers return and exchange products. These are things you practically can’t do on your own but which a fulfillment service can reliably provide for you and boost your reputation with your customers.
- Harness technology. - Fulfillment companies employ the latest technology and systems when it comes to processing and packaging products, inventory management, item tracking and information, product security and handling, shipping and carrier selection, payment processing, and integration with your sales channels and business tools. These service providers are in the fulfillment business carrying with them industry experience and expertise which you can leverage to your advantage.
- Focus on sourcing and selling. - Without being bogged down by the all the tasks and processes involved in fulfilling orders, you can now focus your time and effort sourcing, promoting, marketing and selling your products and making your business profitable.