Why order fulfillment is so important to ecommerce
When buying items online, we as consumers want the package to arrive on our doorstep as soon as possible. As the owner of an ecommerce business your customers will feel the same way. Trying to meet their expectations can be easier said than done. The expectations of the customer is what makes order fulfillment one of the most important aspects of running an ecommerce business.
Here at Hatch Ecommerce fulfillment, we pride ourselves on efficiency and accuracy because we know that customers expect to have a positive experience with an online retailer with as little delay in the time between when they place an order and when it reaches them as possible, understanding the order fulfillment process is vital in running a successful business.
Options for managing inventory
In house order fulfillment: If you choose to fulfill orders for you business in house, (from your own home or a personal space) you’ll need to make sure that you have all necessary inventory on hand and ready to ship yourself.
Outsourcing: If you choose to outsource your order fulfillment, inventory will need to be sent to the 3PL that will fulfill the orders for you. You should have an accurate system in place for seeing what the 3PL has in stock at any given time to avoid item shortages and to reduce the wait times for customers.
Warehousing: When using a third party fulfillment center storing inventory will typically take place in a warehouse where items will have dedicated locations to keep products organized and to make the picking process easier and quicker.
In house storage: When you are fulfilling orders in house, inventory will need to be stored in your personal residence. Businesses using in house order fulfillment will usually store their products in their garage and organize items based on personal preference. This method of storage can often make it more difficult to have an accurate idea of what inventory you have and what needs to be restocked.
Once you receive an order from the customer the next step is to process the order. Processing an order involves retrieving the order (picking), packaging the item (packing) the item with all necessary packing materials, such as bubble wrap, envelopes, boxes, poly seal bags or custom packaging. Then each item will be a label corresponding to the correct shipping service placed on the item and after that the item will be shipped (sent to the customer).
The final step in the initial order fulfillment process is shipping. If your business is still small, shipping could mean bringing packages to the local post office or Fed Ex/UPS store yourself. You could also have carriers pick up your orders on an individual basis.
After a business becomes larger and it no longer makes sense to fulfill orders in house, if you choose to outsource to a third party fulfillment center you could choose to contract with a shipping carrier. Common shipping carriers include UPS, Fed Ex and USPS, but their are several different shipping carriers you could work with.
You should pick a carrier based on factors like cost, whether or not they’ll handle your packages with care and the time it will take for them to deliver your orders to the customer.
While it’s ideal that every customer is completely satisfied with their purchase, at some point you’ll need to process returned items. If you ship items from your house the return will be shipped there but if you outsource order fulfillment the item will most likely get shipped back to the order fulfillment center where the item will be evaluated.
You’ll need to open the packaging and inspect the item inside. Depending on your companies return policy, the reason the package was returned, and what condition the item is in, you can either put the item back into your inventory or dispose of the item due to it being broken or some other malfunction.
How to utilize fast shipping options and technology
With faster shipping options like free 2 day shipping and same day shipping, It has become much easier to keep down shipping times low and keep customers happy.
Keep in mind that shipping is expensive and you’ll need to plan for how to keep costs as low as possible for yourself, the fulfillment center and the customer. To try and keep costs low you can either combine the cost of sipping into the product’s price and use the average shipping cost. You can also require there to be a minimum spending threshold for free shipping to increase the average order value.
Making free 2 day shipping available to your customers will reduce the amount of people that cancel their orders and will increase the amount of customers that visit your page to begin with, but the main goal is to reduce the amount of returns you have.
When fulfilling orders for less expensive products, absorbing the cost of shipping will make you lose money and increasing the cost of the product may make you lose customers.
Using technology to improve order fulfillment
One great way to make your order fulfillment process more efficient is to use software that integrates with the ecommerce platforms and online marketplaces. Using good software can help you manage across orders across all the different sales channels you choose to use. Good software will also eliminate the need for you to do things like keep track of orders and inventory manually.
Using technology will allow tracking information to to be sent to your online sales platform, online marketplace and your customers.
One vital thing to check when deciding what software to use is whether or not the software allows you to see into your inventory in real time. This will help prevent stockouts and will help you order the exact inventory that you need.
Technology is one of the most valuable investments you can make as an ecommerce business owner. One example of how technology can make running your business easier is if you need customers to sign for orders, you’ll be able to use electronic signatures, making the entire process easier for you and the customer. Using technology will help connect the aspects of your business like purchasing, sales and product demand so you can make the best decisions possible for your business.
How to Speed Up Your Order Fulfillment Process
An effective order fulfillment process is vital for running a successful ecommerce business. The order fulfillment process put simply is steps that any ecommerce business goes through from when they receive an order awaiting fulfillment to when the item reaches the customer. At Hatch Ecommerce Fulfillment our process typically follows this pattern –
⦁ An order comes is received from one of our customers directly into our software of choice, where we can view all necessary information unique to that order.
⦁ The customer is notified that we have received their order.
⦁ We print the label unique to that order so we can start the picking process.
⦁ One of our employees assigned to picking orders scans the order into our inventory management system.
⦁ After an order has been scanned into the system, that employee finds the designated item’s location in our warehouse.
⦁ After the label and product in question have been checked and double checked to verify that they have the correct item and quantity.
⦁ When the necessary checks have been performed, the item and it’s label are placed in our packing/shipping station to await packaging and shipment.
⦁ All other orders that have come in at that time are picked in the same manner.
⦁ Once all of our orders are picked the packing process begins.
⦁ When beginning the packing process we fulfill one order at a time to verify that each order is packaged correctly.
⦁ All smaller items will be placed in a flat rate box, flat rate envelope, poly seal bag or box with the proper packing material such as bubble wrap.
⦁ Most of our larger items come packaged correctly from the manufacturer, so labels can be placed on the box the item came in. If no other packing is necessary for larger items all items are moved to the proper location to be picked up by a shipping service ( ex. USPS, Fed Ex or UPS).
⦁ At the end of the day the shipping carriers we work with come and pick up all of our orders and the orders are shipped.
⦁ After shipping, the customer is notified that their item is on the way.
⦁ The order arrives to the customer.
Tips to help your business fulfill orders accurately and efficiently
- Know which items are in demand: You should always try to plan for the demand of the items in your inventory in advance. Being able to anticipate which items will be in demand will help your business run smoothly and will cut down on the amount of orders that need to be cancelled.
- Managing inventory properly: Managing your inventory well is vital to running a successful business. You should always know what items you have on hand, what needs to be restocked and what will need to be restocked most often due to the demand for that particular item. This will help keep customers happy and will reduce the amount of delays and backorders.
- Effective logistics and supply chain support: When the items in your inventory are running low or are out of stock, how quickly the manufacturers can make more and how quickly you can get more in stock will greatly impact your order fulfillment process.
- It’s also important to think about how you’re going to get products to your customers, how long it will take for packages to reach them and whether or not the shipping services you choose to use will to handle the packages carefully. Thinking about all of this in advance will keep your customers happy and cut down on the amount of returns.
How to utilize warehousing for your ecommerce business
How warehousing relates to your ecommerce business?
Warehousing for ecommerce is storing physical goods before they are sold on an online marketplace. The process of warehousing includes safely and properly storing products, tracking where items are located after they arrive at the warehouse, how long those items have been in your inventory and the amount of items you have on hand at any given time.
What is ecommerce warehouse management for an online business?
Running/managing an ecommerce warehouse includes:
⦁ Training staff to work in the warehouse.
⦁ Accurately managing inventory and equipment.
⦁ Building a relationship with chosen shipping carriers and mantaing those relationships.
⦁ Securely storing products in the warehouse.
⦁ Predicting the amount of demand for items in inventory.
⦁ Obtaining all necessary certifications and licensing (such as operating a forklift).
⦁ Scaling procedures as the business continues to grow.
⦁ Making sure that all proper safety procedures are followe in the warehouse.
⦁ Accurately recording all shipments coming in and leaving the warehouse.
These are only some of the necessities of running an ecommerce warehouse. Because there are so many steps, time requirements and stress involved in running a warehouse, many people choose to try and fulfill orders from their home and store items in their living room or garage. Business owners typically choosw in house order fulfillment