When you talk to small business owners, one common theme heard frequently is the lack of time to complete every project and capitalize on every opportunity. This is no different for small businesses that sell a product online. From manufacturing of product and management of their marketing to fielding customer service issues and shipping product, a small business is inundated with work – all tugging at the small business owner for attention.
It’s no wonder that business owners are frequently looking for ways to make their lives easier. And outsourcing various functions presents a viable option to propel the business forward to new levels of success – especially outsourcing order fulfillment. After all, shipping products is a very straightforward business process. But are outsourced fulfillment companies worth their weight in gold, or do they end up causing a bigger headache than keeping the function in house? It all depends on which fulfillment company you choose.
Which Order Fulfillment Companies Can You Trust
Perform a simple search on the web for “fulfillment companies” and you’ll get a listing of over 18,000,000 results. That’s a lot of information to sift through in order to make the right choice. Complicating the matter even further is the fact that most of the fulfillment companies you stumble upon are going to tell you exactly what you want to hear – that they’re the greatest thing since sliced bread, they’ll never make a mistake, they’re cheaper than any other company, and you’re making a big mistake if you don’t choose them!
While the web is great for sharing information, one of the biggest pitfalls of this tremendous resource is the difficulty in finding where the truth lies in the claims of websites. So how do you know if that wonderful sounding warehouse is everything that they claim? Check for reviews online about the company, assess their Better Business Bureau report, talk to their customers, check into any claims or assertions on their website, and generally perform the kind of due diligence you would when buying a new home.
Shipping Success May Require Location Creativity
When outsourcing logistics, a natural inclination of many business owners is to find a local provider. This may be okay for some, but for most companies, locating outside of the company headquarters has the potential of decreasing costs significantly, as well as decreasing order shipping times to customers. There are quite a few things to consider – from where the product is manufactured or supplied to where your end customers are located. Including all of these factors in the overall analysis and being open to companies that are outside of the local area could pay sizeable dividends.
One Size Doesn’t Fit All
The success of an outsourced fulfillment program will largely be dictated by the experience of the fulfillment company – both in terms of years of service as well as area of specialty. Seeking out a partner that specializes in fulfilling orders for a particular niche of products greatly increases the probability of success. For example, if a business sells clothing and apparel, they would be wise to seek out a company that specializes in shipping garments. With experience in a specialized niche comes greater expertise, fewer errors, and better pick and pack rates.
Lack of Technology Will Make the Phone Ring With Complaints
The allure of cheap pricing leads many businesses to choose the wrong partner. Oftentimes the more inexpensive warehousing companies rely on human labor instead of technology for order picking because it costs more to purchase a sophisticated software program. Unfortunately, humans are prone to error, and without technology support, via bar code picking or other related technology, errors will happen quite frequently. And more errors lead to more angry customers. Even though it might cost slightly more, it’s more than worth the additional investment to use a tech-heavy logistics firm.
All in all, outsourcing with fulfillment companies can be a life saver for a small business – but only if done with the right company. By performing adequate due diligence, remaining open to various locations, finding a company with niche product specialization, and insisting on technology, small businesses can ensure the successful outsourcing of their shipping.
- Order Fulfillment Services in the US Industry Market Research Report Now Available from IBISWorld(virtual-strategy.com)
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