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If you run a small business, you should be thinking about selling online. E-commerce fulfillment is a great way to expand your company beyond the brick and mortar sales business model. It allows you to outsource your online business transactions. This will allow you to focus on local business needs. Here are the top five things you should know before starting e-commerce fulfillment.
Types of Fulfillment
Primarily, e-commerce fulfillment has three different models. The models include in-house fulfillment, dropshipping and outsourcing. Of course, you can utilize a hybrid business model between the three. However, most online retailers will fall somewhere between this spectrum. They either do all the acquisition, production, packing and shipping in house, or they will outsource parts of the process. Depending on your company’s capacity and competencies, you will have to find the right balance to achieve the most profitability.
Shipping And Storage
E-commerce fulfillment has two major components. The first is storing and managing inventory. This can be a headache for small business owners that do not have a company warehouse or adequate storage space. E-commerce fulfillment takes care of this for you. The second component is shipping products to online customers. It handles almost the entire process. From picking the product off a shelf and packing the items securely, to shipping the package to the customer, you will not need to lift a finger. If you need a shipping and storage solution for online sales, e-commerce fulfillment will handle this for you.
It Can Save You Time And Money
Second only to money, small business owners often wish they had more time. Shipping items to customers yourself may not seem like a big deal. However, it can become a timely process once your online sales increase. You may need to hire an extra staff member to handle incoming orders, which will cost you more in payroll. E-commerce fulfillment can handle these aspects of online sales to save you time and money.
Too Costly If You Rarely Ship Items
We just discussed how e-commerce fulfillment can save you time and money. However, there is an exception to this. Most of the cost benefits of e-commerce fulfillment are realized when you ship a large volume of items. If you only ship a few items per week, it may be too costly. There are fees associated with the packing and the shipping of items. There are also storage fees, as well. Costs vary by which company you use. However, no matter which company you choose, these costs will still add up. This is one of the most common outsourcing challenges. E-commerce fulfillment is ideal if you ship in bulk and can take advantage of volume discounts.
Great For Seasonal Businesses
If you operate a business that has a large increase in sales at a certain time of the year, e-commerce fulfillment may provide an ideal solution. You might become overwhelmed if you suddenly receive a larger amount of orders due to seasonal demand. E-commerce fulfillment companies assist many businesses during the holiday shopping seasons. Instead of being overwhelmed or hiring more staff, you may wish to consider e-commerce fulfillment for your seasonal business needs.
Shipping Zones And Regional Demand
When you consider e-commerce fulfillment, you should take a look at shipping zones. Most companies take 5-7 business days to ship from the east coast to the west coast. You may want to look for a service that ships from the midwest. If your primary business is on a coast, this may not be an issue when fulfilling only local orders. However, as you expand your business it may give your competitors an edge if your customers have to wait longer to receive orders. You should also consider regional demand. For example, if your top selling item is cold weather related, shipping out of a warm southern state may cause unnecessary delays. Think about shipping times and regional demand when considering e-commerce fulfillment, so you never have to worry about shipping container sizes ever again.
Many Options
What is great about e-commerce fulfillment solutions is that there are so many of them. A quick search will prove to you just how many e-commerce fulfillment services there are available to you. However, it is important to consider the location of your business, as well as shipping zones, regional demand and various other factors. Whether you decide on a company like Efulfillment Services, EFS, Shopify, Shipwire or any other e-commerce fulfillment providers, you need to know what your business and its customers need in order to make the right decision.
E-commerce fulfillment is an excellent way to grow your brick and mortar business while avoiding supply chain risks. Outsourcing online sales allows you to focus on your local business without missing opportunities to sell to a larger audience. There are a number of companies that perform this service. Remember this post when considering your options.
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