Is Your Web Store Enough to do Fulfillment on Your Own or is it a Recipe for Disaster?
If you’re reading this article, you probably sell products using one of the major web store programs, such as Shopify, Magento, or Volusion. There are literally hundreds of options to choose from, and in terms of managing products on your online retail storefront, these shopping cart solutions for the most part do a great job of helping to take away the pain of managing your website. More recently, there have even been a surge in growth of online apps that easily integrate with shopping carts and help manage other important aspects, such as online reviews, bulk discounts, and coupons. With so many tools available within the web store backend and via online apps, it’s tempting to think that using these resources to manage your own in-house fulfillment of orders will be a snap! However, using these tools for fulfillment and shipping could very well be a recipe for disaster. In our experience at FulfillmentCompanies.net, we’ve run into a lot of online merchants that end up searching for ways to address their logistics challenges because their current set up just doesn’t work well.
The Liabilities Behind Using Online Fulfillment Tools
The biggest problem for web stores like yours is most of the tools available to complete the fulfillment and shipping processes simply promote bad practices. One of these bad practices is to always use the daily batching of orders. At the start of the day, the web store owner will print all of the invoices for the day, purchase and print all of the shipping labels for the day, then manually click through a list of orders (not sorted by priority, either). This is incredibly inefficient and absurdly error-prone. Not only are you unable to prioritize the orders efficiently, you’ll also run into issues when one of your customers calls in to change the order – which we all know happens far too frequently!
The time wasted by using batch processing can cripple any well-intentioned small business owner. One of our pre-screened fulfillment warehouses that specializes almost exclusively on solutions for merchants that use Shopify, Ships-A-Lot, has helped numerous companies overcome this specific challenge. In fact, one of Ships-A-Lot customers, JerkyXP, used these methods. They had some really absurd waste figures and were able to improve their processes and increase their profits thanks to Ships-A-Lot, which you can see here.
Forced to Use Apps to Perform Different Tasks
Apps are both a blessing and a curse. They’re a blessing because they offer a relatively easy way to add functionality to your shopping cart. However, they can be a curse for a number of reasons. First and foremost, you may find yourself having to add a number of apps to handle the various needs of your online store. This will require you to stay on top of managing the individual apps and processing and applying any updates – which can be extremely time consuming.
Secondly, you may find yourself having to modify your ideal processes and procedures to utilize the app, since most apps are built for “the masses”, without an enormous ability to create a more customized solution for your unique needs. Unless you have a background in computer programming or are willing to spend sizeable sums to your IT company of choice, you’ll need to adjust your business to fit the ability of the apps.
Limits on Shipping (such as only shipping by total weight or price)
If you search the online forums on web stores’ websites, one of the most common problems you’ll find is that retailers feel crippled by the options offered for shipping. Each shopping cart offers unique options for how to display the various shipping orders for customers. Most often, there are limitations to how you can package the shipping options to your customers, usually including such options as shipping by weight or by price. If you require the ability to provide more flexible shipping options for your customers, such as shipping from different locations, international shipping flexibility, or a host of other scenarios, you’ll be in need of yet another plug in or custom programming feature to accommodate your needs.
Customization Requires a PhD in Computer Science
A company is only as good as its processes, procedures, technology, employees and actual end product or service that is offered. In order to before a lean and mean operation, processes and procedures must be successfully implemented so that you can run your shop efficiently and effectively, leaving you some time to actually focus on growing your business. Because your online shop is based upon a technology platform, in order to establish effective processes you’ll no doubt have to customize your shop in some way, shape or form. As mentioned previously with regard to apps, this will require you to either make the coding changes required to establish best practices for your fulfillment operations, or you’ll have to pay for them to be implemented for you. Computer programmers and “coders” earn a very good living, oftentimes able to charge well in excess of $100 per hour. The costs of making a smooth running fulfillment operation for your small business will add up quickly.
Dealing With Financial Waste
Once your eCommerce business hits a certain size OR the you start hunting for financial waste, the waste is VERY apparent and the choice is usually made to start developing your own best-practices fulfillment operation or outsource the fulfillment services altogether. Starting your own fulfillment center engenders a huge amount of costs and typically won't yield a financial benefit for quite some time. Lots of experience and education will have to be gained to streamline the operation. Outsourcing at this stage is typically the best solution financially.
In our experience, we’ve found that outsourcing with a professional fulfillment services company makes sense in most cases for online retailers. Here's why we’ve found that outsourcing is your better bet:
1. You Simply Don't Have Time for Fulfillment
Some businesses simply have other things they want to do rather than pack boxes. You may feel the same way, especially when you have a complex web business requiring other duties to stay competitive – from online marketing and social media, to product development. It takes a special knack to package items, and it requires considerable investment in buying the right type of boxes. An outsourced fulfillment team already has access to the proper shipping boxes and containers. Further, they'll know how to efficiently pack an item so it's thoroughly protected.
2. You Don't Have the Technology Available
A top-performing fulfillment center requires the best technology to get products properly packaged and sent out in quick succession. Because customers want items shipped to them faster than ever, how do you make this happen without the proper technology? If you have limited resources available at your disposal, you can't supply the necessary technology to help this along. Outsourcing to a fulfillment center lets you use their warehouse space where they'll already have the best technology available to get your products out in hours.
3. Getting Better Overall Rates
Working with an outsourced fulfillment facility helps you get better shipping rates than you'd be able muster on your own. Having to impose high shipping charges on your packages is always anathema to customers, and why chance this when you're still establishing an online customer base? Outside fulfillment helps negotiate better rates with carriers. Furthermore, since fulfillment companies focus solely on warehousing, fulfillment and shipping, they become more efficient in these processes and can pass the cost savings onto your company. From only paying for the space you use to paying lower overall rates per order due to cost efficiencies, outsourcing will not only free up your time but also help bring much-needed savings to your bottom line.
Fulfillment companies can also serve as a consultant of sorts. In the case of Ships-A-Lot, companies are able to leverage their specific knowledge in the Shopify platform to built better solutions, increase sales, and decrease costs.