Online shoppers continue to push retailers to meet delivery expectations when it comes to shipping costs (free) and convenience. This is a tall order for many merchants. However, those who meet customer expectations are winning more sales. Among a competitive landscape, retailers are realizing more than ever that their fulfillment processes can be a competitive advantage.
If you haven’t put serious thought into your fulfillment processes yet, now is the time to do so! You could be losing sales because you’re not offering what customers are looking for. Read this article to understand what today’s online shoppers are looking for and how you can improve to meet their needs.
Why Online Order Fulfillment Matters
Delivery speed, price, and location options can dictate where a consumer decides to spend their money. How many times have you abandoned a cart or chose one seller over another because of delivery times and cost?
For the U.S., the second leading reason for choosing to shop on marketplaces is free and discounted shipping, according to the UPS Pulse of the Online Shopper 2018.
Sellers are realizing that shipping options and price are a big part of the purchasing decision for online shoppers. The issue is that you must be able to balance lowering costs and fast delivery times without destroying your margins. There’s a lot that must go-on behind the scenes to ensure that the correct product lands on that customer’s door by next day.
Revamping your logistics is a big undertaking, but surely worth it when done right. You don’t want to continue to lose or frustrate customers with long delivery dates and expensive shipping rates.
What Fulfillment Areas to Focus On
Here are key areas to focus on to ensure you improve your fulfillment processes for the long run.
When it comes to inventory, customers want to know two things: is an item in-stock and how much is left. Real-time inventory visibility gives customers the confidence to purchase. If an item has low stocj, it can also entice a customer to buy now.
To provide customers that information, your organization needs visibility into inventory counts across all sales channels, both online and in-store. When you sell an item, inventory counts should be updated immediately for customers. Nothing is worse than overselling and then telling a customer that you can’t ship the item they thought they bought.
How quickly can you get your products into your customer’s hands?
According to the UPS 2018 Pulse of the Online Shoppers, online shoppers in the U.S. and Canada tend to think they have to place orders by noon to be eligible for same-day delivery.
Today’s shoppers expect fast shipping times from same-day to two-day delivery. These demands can seem unrealistic for merchants as they face last-mile delivery challenges and rising shipping costs.
However, experts like Oracle and Convey say that merchants, over anything else, should first focus on delivery days that they can guarantee. If a consumer is confident that their order will arrive when the retailer says it will, they might be more willing to wait a few days.
One of the most frustrating experiences for an online shopper is receiving the wrong item or never receiving a package at all. Merchants can’t overlook the importance of accurate deliveries to customers.
These types of errors often result from data integrity in your organization. If you’re manually entering shipping address and SKU items from your eCommerce platform to your ERP, it can be easy to mistype data. Or, maybe your warehouse is disorganized and it’s easy to pick and pack the wrong item. Either way, it should be a goal to eliminate these types of errors from your organization.
Today, many online shoppers consider shipping costs before even getting to your checkout page!
According to the NRF, 65% of consumers say they look up free-shipping thresholds before adding items to their online shopping carts. Further, 39% expect two-day shipping to be free. And, if you don’t offer it, consumers will shop somewhere else. 29% of consumers have backed out of a purchase because two-day shipping wasn’t free.
Consumers want their items fast, and they don’t expect to pay much either.
How to Improve Your Order Fulfillment Process
Consumers have lofty shipping demands. How do you meet them?
Here’s some thoughtful ways to improve your current order fulfillment processes.
Choose an Order Management System like an ERP.
If you’re struggling with order management and fulfillment, it may be time to invest in backend system like an ERP (Enterprise Resource Planning) such as NetSuite, Microsoft Dynamics, and Sage. An ERP can drastically help with your fulfillment and financial processes. You’ll be able to track sales, manage inventory, create products, and fulfill items all from a single place.
If you’re not sure what ERP is right for you, check out our buyer’s guide that evaluates some of the most popular systems.
Invest in system integration software.
If you’re implementing an ERP/Accounting system or already have one in place, consider system integration software to connect that system to your eCommerce platform. System integration platforms enable merchants to sync data and automate processes between their systems, which eliminates the need to hand-key data from one system to the next.
For example, without integration, merchants often hand-key an online order from their eCommerce platform into an ERP for processing and then hand-key shipping/tracking data by hand back to the eCommerce platform to complete the process. Manual data entry is slow and prone to errors.
Integration can automate processes from online order processing and inventory synchronization to syndicating product listings and financial reporting. System integration keeps your data accurate and accelerates daily processes like order fulfilment.
Learn more about how nChannel automates order processing for your online business.
Use shipping apps.
Most online business use shipping apps to compare shipping rates, create and print labels, and track packages. These apps eliminate the need to copy and paste shipping info into carrier websites. With affordable pricing, these apps can be a time saver for your company. Check out popular shipping software like:
Outsource fulfillment to 3PLs (Third-Party Logistics) or fulfillment Companies.
3PLs, or third-party logistics companies, take care of your supply chain processes like warehouse management, transportation of goods, reporting, and forecasting. 3PLs can specialize by industry or a certain area of logistics.
Instead of specializing in logistics yourself, you can outsource your processes to a 3PL who can leverage their relationships and volume discounts for affordable, fast shipping for your customers.
If you think a 3PL might be a good fit for you, check out this overview to learn more about what a 3PL is and how retailers can benefit from then.
Consider drop shipping your inventory.
Drop shipping is a fulfillment process in which merchants buy goods from a vendor (like a wholesaler or manufacturer) who ships them directly to the consumer for the merchants. The best part is that the wholesaler remains completely invisible to the customer.
Drop shipping is an effective way to start an eCommerce business or add new products to your catalog, without worrying about securing new inventory. With drop shipping, you don’t need to keep inventory on-hand or ship the items yourself.
When done right, drop shipping can be a successful fulfillment strategy for online sellers. Learn more about the practice in our Introductory Drop Shipping 101 Guide.
Offer Buy Online, Pick Up In Store (BOPIS).
If you operate brick-and-mortar stores, alongside your webstore, then buy online, pick up in store (BOPIS) programs are a must! Using the alternative shipping method of picking items up in-store is growing in popularity among consumers.
Almost 2 in 3 people have used BOPIS. Their main reasons for doing so are to avoid shipping fees, immediacy, and convenience.
More importantly though, just having the option of picking up in store can increase a consumer’s willingness to buy.
66% of consumers say that providing multiple fulfillment options influences their willing to complete their purchase.
However, being able to offer BOPIS for customers is complex for merchants. Read more about how to overcome the challenges of offering BOPIS for your customers.
Learn from Others.
One of the best ways to improve your processes is to hear and learn from others like you. Read this informative interview from outdoor seller, United By Blue, and what they learned from handling fulfillment during growth periods.
Many merchants face serious fulfillment challenges. However, overcoming those challenges can turn your fulfillment processes into a way to increase sales and delight customers!