How to choose the best fulfilment service
What should I expect from a fulfilment service?
If you produce a large quantity of goods AND have to manage the packaging and delivery of these items within a certain time frame, you may find it useful to hire a fulfilment company. A reliable fulfilment company can be a welcome third-party investment, focussed entirely on handling your inventory, order processing and delivery / shipping of your goods.
Some companies operate their own fulfilment service and others find that the time taken to do this could be better spent dealing with marketing, product development, business management and innovation.
If you’d like a breakdown of exactly what a fulfilment company does, how much you should expect to pay for such a service and what it would take for you to do these tasks yourself then read on.
1. What is a fulfilment service?
Think of Amazon (Not the rainforest). They don’t actually produce anything. It’s a genius business really (Much like any supermarket in a sense). They store other people’s stock for them in fulfilment warehouses. They catalogue, package and label the goods. When orders come in then the fulfilment centre is notified and they arrange shipment of the goods.
If the items are damaged at all in the warehouse then Amazon will simply purchase the goods from the supplier. Amazon want to make sure the goods are ready to be shipped as quick as possible, so from being received it only takes three business days for the goods to be scanned and ready to go.
Now I’m not trying to be an advert for Amazon.com but they do present an excellent representation of what an organized fulfilment service should do.
In short, they receive your stock, organise it, store it then pack and deliver your goods in pristine condition.
So, if you are dealing with large quantities of stock and you don’t want the headache of dealing with packing and delivering your items then it might be worthwhile looking at what a good fulfilment service can do for you.
2. How do I get my stock to the fulfilment company?
It stands to reason that if a fulfilment company is going to store your goods then it must have a way of getting there in the first place and it is worthwhile investigating how this happens.
Some of the bigger delivery and courier services offer a fulfilment service too, which is ideal as the company have the resources in house to collect your goods and deliver them to the fulfilment warehouse. Parcel Ex and a few other companies out there provide this service.
If your fulfilment company do not provide this service then you will need to arrange delivery of the items from your supplier or manufacturer to the fulfilment centre. To do this you simply need to tell the fulfilment centre what they can expect in terms of quantity, type of item, new products or re stock etc. This is normally done very easily and hassle free by using a purchase order.
If you manufacture your own goods then the chances are you have your own warehouse which you will want cleared to make room for new products. The process is very simple from there, you arrange delivery from your warehouse to the fulfilment centre.
3. What will a fulfilment company do with my inventory?
Once received, the fulfilment company sets to work organising and labelling your stock. They should check for damaged or missing items and they should notify you immediately if any of your goods are damaged or missing.
Naturally you want 100% of your stock arriving at its final destination in exactly the same state as it was when it left your warehouse. Legally it is YOUR responsibility to make sure the goods reach their final destination and the buck cannot be passed to a separate courier or fulfilment service to compensate an unhappy client upon delivery.
Having said that, you do have a right to claim back that money from your fulfilment company / courier if they are at fault and not providing the service that you have paid for.
It seems like an obvious thing to say, but please, please ensure the company is insured for loss and damage and it is in their terms and conditions that any loss or damage will be FULLY compensated in the case of loss or damage.
The chances are, you will have your own labels on your packages for which you can accurately identify items. Fulfilment companies often have their own labelling system which can override the one you have in place. If you would rather they used your system, ask. Some companies can be flexible enough to incorporate your numeric system.
4. A fulfilment company should be a partner in your business.
It is in the fulfilment company’s best interest that you stay in business and keep on using them, as such, the more efficient ones keep an up to date inventory of what goods are sold over what time period. They regularly feed this information back you.
This can be very useful to you as a business owner to satisfy market demand and can help when looking at modifying or removing items that are not doing so well.
5. How does the fulfilment company fulfil my customers orders?
First of all – Yes, a good fulfilment company should have the capability to fulfil your customers orders, which means they receive the orders for the goods that they have in storage and arrange delivery within an agreed timescale.
This is a huge time and money saver as it does not rely on you paying staff to take orders and then wait for them to relay that information to the fulfilment company, and it shouldn’t take a great deal of setting up.
The fulfilment company in most cases will connect their own system to your e commerce site. Some people don’t have such a platform in place. In those cases it’s worthwhile finding out if they can take orders over the phone (This is not unusual, many do).
If you are operating an e commerce site make sure you collect the following information to make transition to the fulfilment company as smooth and hassle free as possible:
- Customers Name.
- Specific products ordered (Quantity and Type)
- Expected date of arrival.
- Specific delivery instructions.
It may not be possible for the fulfilment company to connect with your e commerce system directly. In those cases, you will either have to provide a bulk order list on CSV to fulfilment company providing all the relevant information. You could also operate a system where each order is manually entered into the fulfilment company’s portal. These options take more effort, time, expense (Over the long term) and staff. And because there is more human involvement there is an increased chance for errors.
6. What is Pick, Pack and Ship?
Well, it’s not an earlier version of Snap Crackle and Pop.
Once your orders are received and understood, the fulfilment company picks the relevant items from your inventory, scans them to make sure they are exactly the right product and then they pack them ready for a safe journey.
If you want branded packaging then the fulfilment company will do that at this stage. Not all fulfilment companies provide this, so it is worthwhile checking.
Great, your goods are ready to be shipped out. The fulfilment company should already be aware of how the goods are to be transported in order to reach their final destination on time and that information should be fed back to you well ahead of time.
For companies that operate this in house then you can agree a price for this that you are happy with well ahead of time, which helps with your budgeting. If your company does not handle this in house then they should still be arranging the appropriate transportation at a price and timescale that you are happy with. Speak to your fulfilment company ahead of time to see how they can help you with this.
7. How do I deal with Customer Returns?
It would be nice to think that every item you ship will always arrive in pristine condition, on time and be exactly what your customer wants and whilst that may be the case you will more than likely have to deal with unwanted items coming back.
Fulfilment companies are aware of this and for the most part, returns can be included in their price but for items which have a high return rate, some fulfilment companies will charge to arrange the safe return of these items.
It is up to you at this point to decide what happens to these items. You may wish them to be reintegrated into the stock pile at the warehouse or discontinued. This should be discussed with the fulfilment company from the very start.
I hope this has given you an insight into what you should expect from a fulfilment company. Don’t hesitate to get in touch if you have any queries on this and our staff will be happy to help.
If you would like a quote or further information on fulfilment for your company click the link below and we’d be happy to assist.