Many online retailers take advantage of the benefits of outsourcing their supply chain management processes and use a fulfilment provider to manage their orders. Third party fulfilment providers for e-commerce clients, whether large companies or individual sellers, offer services such as warehousing / storage, product assembly, packaging, and distribution of customer orders.
If you are considering whether to manage your stocks and customer orders yourself, or outsourcing to a 3PL fulfilment provider, here are some of the benefits you might consider:
A fulfilment provider offers a ‘one stop shop’ to manage every order you receive, either through a sales platform like Amazon or eBay, or through your own online store.
With technologically advanced inventory management systems, every time an order is completed through your store – i.e. paid for and ready to ship – the order is sent to your fulfilment provider, the order is picked, packaged and sent out.
This leaves you more time to manage your listings, communicate with your customers and concentrate on marketing your products, knowing that all your orders are being safely and professionally managed.
Using a 3PL fulfilment partner to manage your stock and orders cuts down on a number of large overheads which are a burden to smaller companies, or those just starting out. For example, costs can be eliminated such as:
Warehouse rent or purchase cost
Staffing costs for warehouse staff to pick and package each order
Software costs to manage an inventory management system
Transport costs – postage rates 3PL providers offer can often be better than any rates a standalone retailer will be able to negotiate due to the volumes they send out each day
Human errors; a professional fulfilment company will use barcode scanners to eliminate any human error in picking the wrong product, and using their expertise you can reduce and remove returns and issues resulting from pick/pack errors
Imagine starting a new online e-commerce business, selling loads of your products, and then needing more space to store your goods, more staff to keep up with sending out the daily orders, and the associated issues during quieter periods when you no longer need as much space or as many staff.
Using a 3PL provider gives the benefit of having flexible access to storage space and staff to manage your orders, without the obligation to continue paying those overheads when trade is outside of peak times.