In the current age of online retail, it is not uncommon for small business owners to feel overwhelmed by their need to manage every aspect of a company.
However, there are some parts that may be better left to outside companies. If you find yourself feeling like you are spending too much time on order fulfillment and logistics for your Shopify store and neglecting other parts of your business, it may be time to outsource your order fulfillment.
The benefits of outsourcing your order fulfillment are many. For one, you can save on the cost of hiring and managing employees. Additionally, you can minimize the amount of space you need to store inventory by using a 3PL’s warehouse.
Furthermore, a third party’s warehouse can offer more efficient and timely order fulfillment than you could manage on your own as well as room to grow without having to worry about expanding your own warehouse.
If you are feeling overwhelmed by the thought of outsourcing your order fulfillment, take a look at these signs to see if it is the right decision for you:
- You are neglecting other areas of the business
- You are struggling to keep up with demand
- You are finding it difficult to manage inventory levels
- Your warehouse is too small… or maybe too big
- There is an increase in the return rate on orders
Before we dive into this more, let’s start with the basics.
What Are Order Fulfillment Services?
Order fulfillment services are companies that store and manage your inventory and then ship out the orders to your customers. They can help with everything from taking orders, picking and packing the items, shipping them out and handling returns.
When it comes to Shopify stores, the order fulfillment service typically has software that integrates directly with your store. All order and shipping information is transmitted to them as soon as a customer places an order.
They also transmit information back including things like order statuses and inventory levels.
How Much Do Fulfillment Services Cost?
Costs are going to vary for each fulfillment company and based on your unique needs, including storage needs, how many SKUs you have, shipping volume, where you ship your products, what shipping times you require (2-day shipping, overnight shipping, etc.), unique packaging, etc.
To get an exact quote on your unique shipping needs, you can contact us about handling your Shopify order fulfillment.
What Are The Benefits of Outsourcing Shopify Order Fulfillment?
There are many benefits to partnering with an order fulfillment service for your Shopify store.
Some of the benefits include:
You Can Focus On Growing Your Business
For a busy ecommerce store, order fulfillment is a full-time job in itself. When you outsource this to a third party, you can focus on the areas of your business that need attention the most such as marketing and advertising, building your brand, creating new products, managing your staff and employees, and expanding your footprint.
This is especially important for small business owners who are trying to grow their company and may not have the time to manage every aspect themselves.
Save Time and Money on Managing Warehouse Employees
Hiring, managing, and training warehouse employees can be very costly.
In addition, you are responsible for their salary and benefits, as well as any workplace-related costs like insurance, workers’ compensation, and unemployment insurance.
When you outsource your order fulfillment to a third party, you don’t have to worry about any of this.
You also don’t have to worry about the whole recruiting and onboarding process when you need to expand your staff or replace workers who have left.
Save Money on Warehouse Space and Inventory Storage
As your business grows, you will quickly find that you need more and more storage space to house your inventory.
This can be costly, but it’s a problem that many fulfillment companies have already solved.
They have the space to store your inventory and often charge much less for storage than you would pay on your own.
Having a 3PL partner can be especially beneficial if your Shopify store is very seasonal or experiences a lot of peaks and valleys in order volume throughout the year. You are not stuck paying for a larger warehouse and staff that really are only needed for a few months throughout the year.
Leveraging the Fulfillment Expertise of a 3PL
3PLs are experts in order fulfillment. They have been doing it for years and have the processes and procedures down to a science.
This means that you can rely on them to handle all of your order fulfillment needs – from taking orders, picking and packing the items, shipping them out, and handling returns – while you focus on growing your business.
Signs That Tell You it is Time to Start Outsourcing Your Shopify Order Fufillment
If you are experiencing any of these, it may be time to outsource your Shopify order fulfillment.
Neglecting Other Areas of Your Business
As mentioned earlier, order fulfillment is a full-time job.
When you are trying to run a business – whether it is an ecommerce store or not – you need to focus on the areas of your business that will help you to grow. Being great at order fulfillment is important, but it’s not going to bring you the same ROI as focusing on things like marketing, advertising, building your brand, finding or creating new products to sell, improving existing products, and managing your staff.
If handling order fulfillment is taking you away from any of these things, it might be time hand it over to someone else.
Struggling to Keep Up With Demand
This is certainly a good problem to have, but it is a problem nonetheless.
When your ecommerce store is experiencing a lot of growth and your current order fulfillment process can’t keep up, you need to find a solution fast.
One option is to outsource your order fulfillment to a third party.
This will allow you to continue taking orders and shipping them out as quickly as possible without having to worry about hiring and training more employees or expanding your warehouse.
Managing Inventory Levels is Becoming Difficult
Inventory management can be a challenge for any business, but it can be especially difficult for ecommerce stores.
This is because you need to make sure you have the right amount of inventory on hand at all times without tying up too much money in stock.
If you are finding that managing your inventory is becoming more and more difficult, it might be time to outsource your order fulfillment. Third party logistics companies have experience in managing inventory and can help you to make sure you have the right products at the right time to fulfill your orders.
You Are Running Out of Warehouse Space… Or Have Too Much Space
Leasing or owning warehouse space can be expensive. When you start running out of space, what do you do? If you own the space, you can consider building on to it. Certainly not an inexpensive option.
If you are leasing space, you will likely have to look for a new warehouse you can lease? Are there any available that fit your growing needs? How far will you have to move? Will your employees all stay if you have to move the warehouse 20-30 minutes in one direction?
Almost as painful as needing more space is having too much space. This is a frequent problem with Shopify stores that are very seasonal or where sales spike at different times of the year.
If you are selling Memorial Day and 4th of July themed products, you are going to be at max order volume between April and July. The rest of the year, you probably do not need as much storage space, or employees for that matter.
Outsourcing your order fulfillment and storage leverages the warehouse space of a fulfillment partner, and shifts these additional costs to them.
You Have Been Seeing an Increase in the Return Rate on Your Orders
This can be concerning and frequently happens to ecommerce stores experiencing rapid growth. They find it difficult to keep up with the added demand, and some processes start to fall through the cracks.
If you are seeing an increase in the return rate on your orders, it might be time to outsource your order fulfillment. A third party logistics company can help you to improve your process and help you to easily scale with increased order volume without losing any of the service your customers have come to expect.
Frequently Asked Questions About Shopify Order Fulfillment Services
While each order fulfillment service is going to differ in what they are capable of handling for you, these are some questions people often have about outsourcing order fulfillment for their Shopify store.
Will They Handle Returns?
In most cases, the order fulfillment partner will handle returns for you. This includes processing the return, issuing a refund if applicable, reshipping an order or part of an order, and restocking the product.
You never have to be involved in the process.
Will They Use My Custom Packaging?
In most cases, you will be able to use your custom packaging. If you have not yet created custom packaging, most Shopify order fulfillment services will have packaging options available for you to choose from.
Do I Have To Ship All Of My Products To The Fulfillment Center?
You do not have to ship all of your products to the fulfillment center. In fact, you can choose to ship only the products that are being fulfilled by the partner. You keep control over your inventory and which products are available for sale on your Shopify store.
What Happens If I Need To Make A Change To An Order?
You can make changes to an order at any time. In most cases, you will be able to do this directly from your Shopify store. Simply log in, find the order you need to modify, and make the necessary changes.
The change will be sent to the order fulfillment partner and they will update the order accordingly.
How Will I Know If an Order Was Fulfilled Successfully?
You will receive notification when an order has been fulfilled successfully. This will come in the form of an email notification and, in some cases, a tracking number for the package. You can also check the order status in your Shopify store.
What Happens If an Order Is Not Fulfilled Successfully?
If an order is not fulfilled successfully, you will receive notification of the issue. In most cases, you will also be able to see what the problem was in your Shopify store. You can then take action to correct the issue and resend the order to the fulfillment center.
Ready to Get Started?
If you are considering outsourcing your order fulfillment, these are some signs that it may be time. By outsourcing to a third party logistics company, you can improve your process and scale with increased order volume without losing any of the service your customers have come to expect. Contact us today to learn more about our Shopify order fulfillment services and how we can help you take your business to the next level.