With digital shopping, buyers can now access items they might never have been able to purchase at physical stores in their locality. With a digital shopping platform, businesses can expand their markets quickly, with only one significant challenge—the fulfillment process.
Covering everything from getting stocks, storing them, processing orders, and shipping, the fulfillment process takes most of a business’s time. Enterprises often start by doing everything themselves but are forced to scale as the demand grows.
Ahead, you’ll find valuable suggestions on how to enhance the fulfillment process for your expanding e-commerce store.
Main Types Of Order Fulfillment Strategies
Depending on the current and potential market demand, as well as the store’s available resources and capacity, a business may adopt the following fulfillment strategies alongside an efficient supply chain management:
- In-house fulfillment: Also called the direct-to-consumer model, this fulfillment method involves the staff performing all the processes.
- Third-party fulfillment: To take the load off their backs, some stores outsource all stages of the fulfillment process to a third party. Interested? You can read more about how this partnership can help your business scale on various online resources.
- Dropshipping: As a cost-saving strategy, this involves online merchants tapping manufacturers to supply and ship the products sold in their respective e-commerce stores. A seller only has to create an e-commerce store and offer items from the manufacturer or another retailer. Upon order placement, the seller forwards the details to the dropshipper, who charges the seller and ships the items to the buyer.
- Hybrid: In this fulfillment model, a business can use two or three of the strategies mentioned earlier. For instance, an online retailer may choose the in-house method for valued or new customers, tap third parties for peak seasons and the holidays, and employ dropshipping for other products.
5 Ways To Scale Your Fulfillment Strategy
All stages involved in order fulfillment must be well-thought-out. Planning for and choosing the best fulfillment strategy is critical, as any misstep can hurt your business badly. Similarly, an online business must always seek to improve its fulfillment strategy through the following:
1. Choosing The Right Partner
If an e-commerce store chooses to outsource a few or all of its fulfillment processes, it means it’ll lose control of some of these procedures, too. That’s why the store must choose the right third-party service provider.
There are many things that you need to consider when looking for the right partner. Efficiency, accuracy, speed, flexibility, and reliability are the most common must-have qualities. A third-party service provider must also be able to ship anywhere without high costs.
2. Maintaining Accurate Inventory
Inventory management is crucial in the success of your business, given that you can’t provide customers with what you don’t have. Having a clear idea of the stocks you have at any given moment can help you make orders in advance, produce in-demand products on time, or push items that have been in the warehouse for far too long. Moreover, installing an inventory management system can help you track real-time data to make smarter decisions moving forward.
3. Automating Processes
Getting all stages of order fulfillment recorded and tracked digitally can help streamline the processes and make them more efficient. Using software for inventory management and processing orders can help make the picking and packing procedures a breeze. It can also increase customer satisfaction and result in lower return rates due to errors and damages. Digitalization comes extremely handy, especially in cases where orders are at their peak, for instance, during the holidays.
4. Integrating Fulfillment Systems
While many brick-and-mortar stores continue to rely on paper for recording and other business processes, it’s highly discouraged for online retailers, especially those who want to scale. More importantly, the software used in order fulfillment—for instance, inventory management systems—should link seamlessly with the business’s online e-commerce store site or platform, payment channels, order processing, shipping, and returns systems. An integrated approach helps reduce shipping errors and increase business efficiency.
5. Knowing When To Use Appropriate Fulfillment Strategies
Effective digital marketing strategy aside, a business must provide additional value to consumers to stand out. Providing impeccable customer service and accurate and fast shipping is a major draw for buyers. For small orders in local destinations, an in-house fulfillment strategy may be enough. If you’re relatively new in the business but want to start big, choose the third-party fulfillment model. To serve clients looking for specialized products and bulky items, dropshipping works best.
Knowing how to choose the appropriate fulfillment strategy and grooming it for scalability is key to increasing market share and efficiency. By making fast and accurate deliveries at reasonable prices, you’ll be able to provide added value to your customers, positively impacting your revenues.
While it’s true that there’s no one size fits all strategy for perfectly fulfilling customers’ orders, you can keep the points raised in this article in mind to make better business decisions and improve your current workflow.