Fulfillment is a huge commitment in time and resources for any company. Time and resources that could be used elsewhere. Because of all the headaches it can bring, many companies choose to outsource order fulfillment, freeing them up to focus more on the growth of their business.
Let’s take a look at some of the reasons companies choose to utilize the services of a logistics company to handle order fulfillment:
Lower Shipping Costs
The first reason most people think of to use an order fulfillment service is because order fulfillment companies usually have the ability to offer them lower shipping costs. They typically have contracts with regional, national, and international shipping companies that allow them to lock in lower rates by leveraging the shipping volumes of their combined customer base.
Reduced Operating Costs
Working with an order fulfillment company can reduce infrastructure and logistical costs. During peak seasons, such as the holidays, additional workers and storage space for inventory may be required. Not all businesses are able to find or hire temporary workers, nor can they temporarily rent out additional space for their increased inventory.
A situation like this leaves them with only bad choices. For example, they can either spend more money in rent or purchasing costs to utilize a larger warehouse than what they need year-round in order to have the space to accommodate peak times, or they can face possible inventory shortages or overstocked storage space during peak times. Neither is a good option.
Instead they can leverage the service of an order fulfillment company to handle these logistical challenges. The need for new or temporary infrastructure is handled by the logistics partner.
Offering great customer service is a goal of every business. Using an order fulfillment service can provide a huge benefit to keeping your customers satisfied. They can handle any order problems, returns, and refunds, which means fewer customer service issues inbound for your team to manage.
Most third-party logistics providers are going to be able to offer you top of the line order and inventory management tracking software that will integrate directly with your online shopping cart platform, such as Shopify or WooCommerce.
This type of technology can allow you to see real-time inventory, track the status of all outstanding orders, track the shipping of all orders, and understand sales cycles that will help with inventory management.
If you have been handling your own fulfillment, then it is no secret to you just how much time managing and completing it takes up. This is one of the biggest reasons ecommerce businesses of all sizes choose to outsource to a 3PL company to handle it.
Ability to Scale
One of the biggest advantages offered by a third-party logistics company is giving your business the flexibility to grow without having to pay for it now. You do not need to buy or rent a larger warehouse for inventory in order to give you room for growth in the future, hoping that the growth is coming sooner rather than later. And what if it doesn’t come as fast as hoped? Your business is paying for all that extra unused space.
Working with an order fulfillment company means you will only be renting storage space that you are actually using, and as your business grows, that storage space can grow right along with you.
It also means that if business suddenly picks up, you are not left scrambling to hire additional warehouse employees to handle the extra workload.
We Are Here For You
In the increasingly competitive online marketplace, order fulfillment needs to be as flexible as ecommerce businesses themselves. You can count on ShipBuddies to provide cutting-edge order fulfillment services for you and your online business.