Ecommerce fulfillment is one of the most important aspects of an online retail business. Much of your business success relies on your company’s ability to fulfill orders quickly and accurately, especially if you do not have a physical store. When you are first starting out, fulfilling your own orders might be feasible, but as your business and your order volume grow, it becomes increasingly difficult to keep up with orders and ever-increasing customer expectations. Fast and free shipping is becoming the norm, as are forgiving return policies. Because of this, it can be harder for smaller retailers to compete with large companies if they store and fulfill their own orders. Outsourcing fulfillment to a third-party logistics partner can be a great option, as it means they will handle services including inventory management, drop shipping, picking, packing and shipping orders, and reverse logistics. Effective ecommerce outsourcing allows you to offer a great customer experience while also focusing on growing your business.
Understanding Logistics for Ecommerce
Simply put, logistics is the process of moving products from one place to another. Logistics for ecommerce requires that products are shipped directly to consumers’ homes, instead of to physical stores. There is quite a bit that goes into this including inventory management, picking and packing orders, and deciding on a shipping method that is cost effective, but will meet your customers’ expectations for fast shipping. It also requires handling returns and potentially integrating these products back into the inventory management system for reselling. All of this can be extremely complex and time consuming. As your business grows, you may consider acquiring your own warehouse and growing into it, but it’s important to look at your product demand when doing this. If this demand is fairly consistent throughout the year, that could be an option, but if your demand flexes up and down with seasonality, ecommerce outsourcing may be a better choice for you. Not only does this allow you to flex up and down with demand, but it also allows you to have an expert team handling your fulfillment needs.
Outsourcing Order Fulfillment and Logistics for Ecommerce
When outsourcing order fulfillment to a 3PL, they handle every aspect of your order fulfillment services. This means they store and manage you inventory using a warehouse management system that often integrates right into your ecommerce store, allowing the data to be updated and monitored in real time. Additionally, your fulfillment partner handles the packaging, labeling and sorting of all packages. At ITS, we have a custom designed software called FlexPick 2.0 that allows our ecommerce fulfillment specialists to package and sort orders in the most efficient way possible. Outsourcing fulfillment to a 3PL partner also gives you access to their shipping partners, which can save you money on shipping costs.
Outsourcing Ecommerce Pros and Cons
There are several outsourcing ecommerce pros and cons to think about when considering ecommerce outsourcing for your business. Outsourcing fulfillment can be advantageous for some businesses because it allows you to focus on business strategy and growth, instead of day-to-day warehouse operations. Having a 3PL partner means you can leverage their distribution and fulfillment expertise, technology, analytics and warehouse space to grow and improve your business while maintaining great customer service and satisfaction.
However, outsourcing fulfillment solutions is not always the best choice for every company and there are some cons to consider. The first thing you need to keep in mind is that the costs can add up quickly as you will be charged for the storage, picking, packing and shipping of your orders. It’s important to understand how your 3PL will calculate costs to understand how expensive storage, handling and shipping rates will be for fulfilled orders. When you outsource fulfillment, you are also giving up control of the fulfillment process to your 3PL. That means if you like making each package completely different and personalized in its own way, your 3PL probably won’t be able to replicate that, or if they do it will come with a cost.
When looking into outsourcing your fulfillment, it’s important to analyze the advantages and disadvantages as related to your business specifically. Make sure that you pick a 3PL with expertise in logistics for ecommerce to ensure that you can deliver the best experience for your customers and allow you to have peace of mind, knowing that your ecommerce fulfillment is handled with care.
Partner with ITS Logistics for Ecommerce Outsourcing
At ITS, we specialize in partnering with companies who are looking at ecommerce outsourcing as a way to grow their operations. We know that fully trusting your 3PL is very important to your company, and your peace of mind. Our ecommerce fulfillment centers and expert team members are ready to handle all aspects of your fulfillment, with the goal of helping you grow your business. Partner with ITS for all your fulfillment needs today.
Distribution & Fulfillment Case Studies
Learn how we’ve tapped our vast partner network to solve logistics problems for clients.