Outsourcing Your Ecommerce Order Fulfillment

When your eCommerce business grows to the point where you can no longer package and ship the orders yourself, it's time to begin outsourcing your order fulfillment. Although all order fulfillment centers offer the same basic services, their individual methods and costs will help you choose one over the other. When selecting an order fulfillment service, keep the following in mind:

Location

Order fulfillment warehouses are located all over the country. It's more important to select a warehouse that is close in proximity to your customers than to select one that is close to your business. For example, if your warehouse is located in California, and most of your customers are located on the East coast, your shipping rates will be higher than if you had a warehouse located in Kansas. Fulfillment centers located in the middle of the country will be able to ship to both the east and west coast for similar prices.

Size

Fulfillment warehouses range from small business with just a few employees to large companies such as UPS. Select a fulfillment service that can meet your daily order fulfillment needs. Do you have consistent orders each day or do your orders spike? If you have orders that spike, be sure to choose a fulfillment center that can handle the extra workload and still ship the orders within the agreed timeline.

Shipping Options

Most fulfillment centers offer a variety of shipping options. Make sure the fulfillment service you select offers all of the shipping options you currently offer your customers and the shipping options that you may want to offer in the future.

Turn-around Time

Each fulfillment warehouse has it's own policy regarding order processing. For example some fulfillment centers will ship all orders that arrive before 1pm on the same business day. If you miss the 1pm deadline, the order is shipped the next business day. This could impact your customers if a next-day order is placed after 1pm. In this case, next day shipping turns out to be two-day shipping.

Order Entry

Order entry methods can be very important when considering a fulfillment service. The most common methods include:

• Forwarding individual order invoices to the warehouse

• Entering each order on the fulfillment center's web-based system

• Emailing an Excel spreadsheet with all order once a day

Each method has a different affect on your business. For example, you may save money by manually entering orders into a web-based application, but it can be tedious if your business grows to the point where you have more orders than you have time to enter. You may pay a higher price to automatically email each individual invoice to the warehouse, but it may be worth the extra costs to have orders may be shipped as they arrive. Same day shipping could give you the edge over your competitor. On the other hand, if you have a high volume of orders, you won't want to individually enter each order into a web-based system and may not want to pay the extra charge of having individual orders emailed to the warehouse. If you don't mind shipping the next business day, you can send an Excel spreadsheet containing all of your orders once a day. Choose a warehouse that offers an order entry method that meets your business needs and fits your budget.

Communication

Communication is an important part of every business. There will be times when you need to contact the fulfillment center to modify a customer's address or cancel an order. Select a fulfillment center that is available via phone and email. You should not have to wait more than a few hours for a return email or call from the fulfillment center.

Error Rate

Mistakes will happen. Some customers will receive the wrong items or the items will be shipped to the billing address rather than the shipping address. When interviewing potential fulfillment centers, ask about their error rate and their process for remedying the situation. For example, do they issue UPS call tags to pick up the incorrect item and pay to ship a replacement item? Will they ship the replacement item at a faster rate to compensate the customer?

Costs

Each fulfillment center operates under a different payment schedule. Some use sliding scales and require contracts while others charge per order or per item with no contracts. You will also be charged a base fee to store your inventory at the warehouse and an additional fee per pallet or per item. Be sure you have a clear understanding of the fulfillment center's costs and any contracts.

When choosing a fulfillment center, create a checklist of the features you would like. Interview a member of the warehouse staff, as well as, their references to make sure the warehouse will meet the needs of your growing eCommerce business. When you outsource order fulfillment, the time that you normally spend packaging orders, managing inventory, and dealing with returns, can now be focused on growing your business. Use this time to expand your product line, enhance your online image, promote your business or expand into new markets.

Copyright 2004. Danna Henderson. All Rights Reserved.

About The Author

Danna Henderson started ZIP Baby in order to provide parents with comprehensive breastfeeding information and a large selection of parenting products. For more information visit Breastmilk Banks.

---

Powered by Feedzilla

Itsula - Travel Reviews, Social Network, Find Friends, and more...

Bidcorral Online Auctions

The ClickBank E-Commerce Solution

ClickBank.com can offer you multiple solutions for your e-commerce business. Here are some of the advantages of using ClickBank.1. Accept Credit Cards Without a Merchant AccountIf your product is downloadable... Read More

Your Readers are Publishers Too

Too often we charge ahead and treat the web as if it were just like any other medium. We know it isn't, but somehow we just can't resist retaining complete... Read More

Shopping Cart Usability

Usable Shopping Carts Increase SalesE-commerce has been around since 1993 under many different names, but one thing remains constant; shoppers want usable web sites. Without a usable shopping cart the... Read More

Alternative E-Commerce Solutions

Over the past several years, the Internet has emerged as a breakthrough technology that has and will continue to transform the way we live and communicate, and especially the way... Read More

Online Payments Make It Easy For Your Customers To Buy

In the last column we discussed the process of credit card enabling your brick-and-mortar business. I pointed out that research has shown that accepting credit cards can help increase revenue... Read More

Managing Project Risks and Issues

Inherent (or Business) RiskInherent Risk is the risk that exists in the environment around your portal project. It will tend to be unique to your organisation; it's culture and politics.... Read More

How Measuring Key Performance Indicators Can Improve E-Commerce Strategy - Part One

The problem with most e-commerce marketing strategy today is that companies don't understand how they use things like web analytics. Most e-commerce directors or web marketers are given a budget... Read More

The Origins of E-Commerce

What is the Internet?In order to provide a discussion on the Internet it is essential to provide a short description on what the Internet actually is. Put in the most... Read More

Are You Making These E-Commerce Excuses? (part 1)

A year ago, I had big plans to re-vamp my web site. I was going to publish my e-newsletter twice a month ? every month, and I was going to... Read More

Is Your Business Afraid of the Internet?

My Business is Afraid of the InternetBill Gates, CEO of Microsoft, once said that there would soon be two types of businesses, those online, and those out of business. Those... Read More

Selling From Your Website

Greetings!Friends and relitives ask us all the time " How do sell from your website?" and no doubt you want to know as well. Over the next two issues we... Read More

Effective Management Of Your Customer Services

With a third party merchant account you will have a dedicated 24/7 support team to handle your credit card payment on your behalf as part of your package. You will... Read More

Prompt Delivery Rules ? Internet Product Sales

The Internet is the fastest growing source of mail order sales. The explosive growth in the goods and services sold online has in the past taken many online sellers by... Read More

How To Accept Credit Cards Online

Anyone with an online business, whether for auctions, services, or virtually any type of product, has asked the same question at some time during their quest to create the ultimate... Read More

Looking For Free Advertising, Here It Is!

There are lots of ways to advertise for free but they are time consuming so I guess technically, they are not free because your time is worth something! But if... Read More

Helping Your Visitors: a State of Mind

What does "helping your visitors" mean exactly?It means writing your sites, newsletters and emails in such a way as to help each visitor achieve his or her goal.That may sound... Read More

How to Write a Landing Page

Is there a difference between writing a landing page and any other web site page? Yes and no. But mainly, yes.You still have to work within the fundamentals of good... Read More

Shopping Cart Features to Consider

Often the simplest Web stores have the most success. But shoppers like special features depending upon the type of store you have, how you market and use them, and if... Read More

Accept Credit Cards Online Without a Merchant Account

There are two major ways to accept credit cards on your website. The first and most expensive is to have your own merchant account. Not only is this option expensive,... Read More

Government Buying and Selling on the Internet

Global Insight, a leading economic and financial forecasting company, (formerly DRI-WEFA), states that all levels of government (federal, state, and local) should see steady increases in the purchases of goods... Read More