Running an eCommerce store is, in many ways, a race against time. The Internet moves lightning fast. Your store has to load quickly, customers need to breeze through the order process, and the goods need to ship fast.
You must be able to fulfill orders quickly to satisfy customers these days. In fact, as many as 53% of shoppers say that speed of delivery plays an important role in the decision to make online purchases. Worse still, 38% of shoppers refuse to buy from retailers after having a bad delivery experience. As many as 25% of shoppers have canceled an order entirely because of slow delivery speeds.
Feeling the pressure yet? Can you hear the clock tick, tick, ticking away? Don't worry - we're here to help!
Following a few best practices can help your eCommerce store fulfill orders quickly and satisfy customers. So let's talk.
What Exactly Goes Into Order Fulfillment?
Order fulfillment is complex, as is the larger set of processes collectively known as supply chain management. So complex are these two concepts that people tend to confuse them.
Supply chain management covers everything from the creation of a product from raw materials to its final delivery (and beyond). The supply chain involves manufacturing, freight shipping, receiving, inventory storage, order fulfillment, and last-mile delivery.
When you look closer at order fulfillment, you see that it is strictly concerned with retrieving items from a warehouse, processing orders, packing items, and shipping them out. While these processes are simple, they're error-prone, especially when you have a lot of orders to ship.
A breakdown at any point in the supply chain can be hard on your business. However, order fulfillment is one of the most valuable (and easiest) areas to improve. It's also one of the most visible, because breakdowns before order fulfillment tend to result in stockouts. Stockouts, of course, are bad, but don't annoy customers in the same way a package that takes two weeks to ship would.
On the other extreme, last-mile delivery, whether you use UPS, FedEx, DHL, or a local post service is largely out of your hands. The only real decision you can make as an eCommerce store owner is to use one carrier over another. This is why improving order fulfillment processes is a much more effective lever.
What Slows Down Fulfillment?
Oftentimes, you'll hear stories of warehouses being delayed. Sometimes it takes a week or more to get an item in the mail. This can happen in mom and pop eCommerce shops during the holidays or in super large warehouses alike. What's actually going on here?
While conceptually simple, there are a lot of things that can go wrong in a fulfillment company's warehouse. A savvy company knows how to work around these issues.
First, the storage of items needs to be done systematically and sensibly. Nothing slows down fulfillment quite like having to look for inventory. Everything needs to have a proper place. Otherwise, slow retrieval times delay when orders ship out.
Similarly, there are a number of miscommunications that can slow down order fulfillment time without necessarily taking a long time to send items. For example, if the wrong items are packed, your customer will likely return them. Likewise, items can be sent to the wrong place entirely! Either situation would, of course, be really frustrating to your customers.
Sometimes goods arrive at the customer's doorstep damaged. If this is the case, this can lead to returns and an overall slower fulfillment process. This can be especially costly, so you want to make sure your items both arrive and leave the warehouse intact!
Lastly, shipping time is largely a function of how far items have to travel. Bear in mind that travel for postage isn't a matter of traveling in straight lines. No, items often go to major hubs before their final destination. Therefore, a well-located fulfillment warehouse needs to be in one of two places. The warehouse can be in the center of a region (such as a hub in western Kentucky in the United States). Alternatively, the warehouse can be right next to major seaports and airports (such as Fulfillrite's New Jersey location). Either option will provide quality service quickly.
Don't Forget Returns
Last but not least, don't forget about returns! As many as 80% of customers will look at your return policy before making a purchase. More items will wind up returned than you might expect, too. That means your returns process needs to be as effective as your standard shipping process.
It might seem counterintuitive to treat returns like order fulfillment, but it's truly important for your bottom line. As many as 92% of customers will make a repeat purchase if returns are simple. So not only are you capturing more customers with a simple returns process, you're retaining them too.
How You Can Prevent Slow Fulfillment
First things first, if you are doing order fulfillment in-house, we strongly recommend outsourcing the responsibility. There are a number of reasons to do this beyond just speed, including simplicity, consistency, and sometimes even saving money.
The single most important thing you can do, provided you outsource fulfillment, is to choose the right company. Be on the lookout for red flags such as bad reviews, late delivery, and poor communication.
A good fulfillment company will carefully pack items, ship out orders the same day up until a certain point, and maintain clear communication with you. They'll also have one or more warehouses located centrally within the regions they serve or will be next to major transit hubs.
One last thing to check: make sure the fulfillment company will provide returns as well. Some companies do not do this, so it pays to be certain!
Order fulfillment involves a lot of moving parts. It's very easy to fall behind. When that happens, it becomes especially difficult to ship orders in a timely manner.
Once your eCommerce store is doing enough business for shipping to become a hassle, it's worth looking into outsourcing fulfillment. By carefully researching your options based on an understanding of how the process works, you can choose the right partner for your company's needs. That way you can ship on-time, every time and satisfy your customers!
Need help filling orders for your business? Contact Fulfillrite today to request a free quote.
Brandon Rollins is a Marketing Consultant at Fulfillrite. His main areas of expertise are online marketing and supply chain management. He also runs Pangea Marketing Agency and Pangea Games.