One of the most frustrating experiences for online shoppers is receiving an online order late or never at all. A bad experience like this can ensure that customer doesn’t shop with you again.
Despite its importance, online merchants tend to overlook their shipping and fulfillment strategy. Others might know it’s important, but find it’s too confusing or complex to optimize. Either way, you could be losing sales and wasting money by not improving your fulfillment strategy.
To help merchants navigate the complexities of eCommerce order fulfillment, this guide helps you determine the best fulfillment strategy for your business.
Meeting Customer Expectations for eCommerce Order Delivery
If you haven’t put much thought into your fulfillment strategy, now is the time to do so! As consumers increase their online shopping, their expectations for order delivery have also risen. They compare merchants based on delivery time, costs, and options.
Don’t take it from us, take it from your customers that delivery time, costs, and options are important to them. They’ll compare and buy from merchants that provide a better experience.
- 96% of consumers said a positive delivery experience would encourage them to shop with a retailer again.
The problem is that most merchants are still falling short of customer expectations. These stats prove it.
- 80% of consumers want same day shipping and 55% are willing to pay a premium for it, but 47% of retailer don’t offer it.
- 46% of online shoppers abandoned a shopping cart due to a shipping time that was too long or not provided
- 1 and 3 say speed of delivery is a reason they choose to buy from marketplaces.
Your fulfillment strategy plays a major role in the customer experience – don’t overlook it. Instead, see it as a competitive advantage.
And while customer expectations might seem too high to meet, choosing the right eCommerce strategy will help you get there.
Choosing the Right eCommerce Order Fulfillment Strategy
No one said that order fulfillment of your online order isn’t hard. It takes the organization of all the people, processes, and technology needed to deliver an online order into your customer’s hands. Throughout the entire process, a lot can go wrong and cause headache for both you and your customers.
So, if you want to improve your fulfillment process, where do you start? First, you must decide which strategy is best for you.
For online sellers, here are your options:
- Fulfill Items Yourself
- Drop Ship
- Use a third-party logistics provider (3PL)
We’ll help you discern the difference between these options, while providing you resources to get started with any one of them.
Fulfill Items Yourself
If you’re just starting out and only need to fulfill a few orders a week, it still makes sense for you to fulfill items yourself. This mean you’ll take care of order processing, pick and packing items, attaching labels, and dropping orders off at mail carriers to deliver. You have a lot of responsibility, but with just a few items, you can ensure accuracy and timeliness.
To make this process easier, merchants can look into eCommerce shipping software to manage shipping rate discounts, printing labels, and managing inventory. Here are some popular options:
For a more in-depth comparison of these shipping software providers, check out this blog post by FitSmallBusiness that compares them.
Another case for fulfilling items yourself is if you have very unique or handmade items. If there will be any issue of your items sitting in a warehouse or being handled by others, you’ll want to have complete control of your fulfillment process.
Drop Ship
Another popular strategy to fulfill orders is to work with a drop shipper.
Drop shipping is a fulfillment process in which merchants buy goods from a vendor who ships them directly to the consumer who bought them from the merchant. The best part is that the drop shipper remains completely invisible to the consumer.
Drop shipping differs from traditional fulfillment process in that the merchant doesn’t have to keep inventory on-hand. Instead, you only purchase stock from your drop shipper when you sell an item. This also means that you don’t have purchase a ton of inventory upfront to get your business started.
If you’re new to eCommerce, drop shipping is an effective way to select and sell different items. It works well for those just launching a new business or current merchants looking to diversify their product lines.
If you’re considering drop shipping, here are few helpful resources to get you started.
- An Introductory Guide to Drop Shipping That Explains Its Advantages and Disadvantages
- How to Find Drop Ship Suppliers
- How to Ruin Your Business Doing Drop Shipping
Just keep in mind that with drop shipping, you’re finding and selling products that a supplier offers. Successful drop shipping business often work best for products sold to niche markets, so there’s less competition to go against.
Using a 3PL
Easily confused with drop shipping, using third-party logistics providers, or 3PLs, is another option to outsource your fulfillment process. 3PLs can also be referred to as eFulfillment services, pick and pack service, and eCommerce delivery providers. As your business grows, it can be hard to keep up with incoming orders. If you’re fulfilling more than 10-20 orders a day, you’ll want to consider using a 3PL.
Unless you’re Amazon, you’re probably not a supply chain and logistics expert. That’s why many merchants turn to 3PL’s or pick and pack fulfillment services to take care of their supply chain processes, or at least a certain area of it. There are many different types of 3PLs that serve different needs or specialize in different industries.
With a 3PL, you still purchase and own your inventory before you make a sale. Then, you ship your inventory to the 3PL’s warehouse to be stored. From there, they take care of picking, packing, and shipping items for you once sold. You still have some control over how your products are packaged and shipped so you can maintain your brand.
With a 3PL, you pay the supplier fees to store and ship your products. You’re also paying for their proven practice to ensure your items are delivered accurately and on-time.
To learn more about using a 3PL, check out these helpful articles:
- What is 3PL and Why are They Important to Retailers
- 5 Things Everyone Should Know about eFulfillment Services
- Why Your eCommerce Delivery Strategy Is More Important than Ever
- How to Choose a Pick and Pack Fulfillment Service that Saves You Time
A note on Amazon FBA
It’s hard to talk about shipping and fulfillment and not mention Amazon FBA, Amazon’s own fulfillment services. Whether you’re selling on Amazon or not, you can use their service to ship your items to your customers using their renowned logistic practices.
If you’re still not sure if Amazon FBA is right for you, see these articles to help you make a decision:
Integrating Your Fulfillment Software
If you do decide to use shipping software, a 3PL provider, or work with a drop shipper, the next step is considering your integration options. While these strategies mentioned above do streamline your fulfillment operations, they add more complexity to how you handle orders between systems.
You still have to manage order and fulfillment information between your supplier and your own eCommerce, ERP, or POS system. Without automation, this can take a lot of time and be prone to human error to enter the same information from system to system. Instead, merchants can use an integration platform like nChannel to automate the processes for you. See how.
Integrating Drop Ship Suppliers
With drop shipping, you’ll need to be connected to your drop ship suppliers. You must have visibility into information that ensures your suppliers are shipping orders on time and charging you the right amount. See how nChannel’s drop ship solution can ensure that level of management from one application.
Integrating 3PLs or Shipping Software
You can also integrate your 3PL or shipping software with your eCommerce platform or ERP so you can:
- Automatically route orders from eCommerce channel to 3PL or shipping software
- Set rules about which items or orders are fulfilled with 3PL or shipping software
- Monitor order status through entire fulfillment process
This ensures that your business fulfillment processes are timely, consistent, and error-free. To see all the systems that nChannel connects, click here.
[…] of these areas have distinct pros and cons. nChannel, a software development out of Columbus, Ohio, has an excellent article detailing the 3 choices […]