Are you looking to expand your small business or streamline your ecommerce sales? If so, you may consider third-party order fulfillment. In this setup, your products are housed, packed and shipped through a different company that specializes in warehousing and distribution. You can keep track of orders with real-time inventory updates, but you do not have to handle the actual labor involved with order processing. The guide below provides helpful tips for small business owners branching into third-party order fulfillment for the first time.
There are a few advantages to handling order fulfillment on your own. You have direct control over your products from the time they're on the shelf to the time they reach the customer. For some small business owners, that control means everything. As we will discuss in the next section though, the benefits of outsourcing your order fulfillment will greatly surpass the need to be in charge.
Another benefit to in-house order fulfillment is that it may seem less expensive on the surface. If you are doing all the labor yourself, you do not have to pay someone to do it for you. However, your third party logistics provider will be able to process orders faster and easier, which will lower the cost per package. In time, you will actually save money with 3PL.
There is only so much you can handle within your small business. If you rent or buy a large warehouse to process your orders, you will have much more overhead than you would with a third-party order fulfillment center. A 3PL provider can grow with your needs, so you don't have to pay for wasted warehouse space. This saves you money and frees more time for your business operations.
Most importantly, an experienced 3PL provider will have the tools, resources and expertise to complete your orders in a timely manner. They will use the latest equipment to pack and ship each package, and they will handle any returns that need to be made. You can focus your energy on other areas of your business and leave the order fulfillment to someone else.
Ideally, you should work with an order fulfillment company that can adapt to your growing needs. You may not want to stay a "small" business forever, especially once you see how rapidly your orders are taken care of. If your business starts to boom, your warehouse needs to accommodate that. Choose a 3PL company with flexible solutions for your small business.
When you discuss a potential contract with a third-party order fulfillment company, you need to be sure about your numbers. What were your sales and costs last year? How many products do you need to store and ship at any given time? Do you need temperature controls or special handling for fragile items? What are your peak sale seasons? Be prepared to provide all of this information and more as needed so the 3PL company can give you an accurate price for their services.
Before you officially settle on a third-party order fulfillment provider, you need to make sure they are willing to work with your business. That's right, order fulfillment companies can turn down clients just as much as you can turn down warehouses. Some 3PL providers do not work with small businesses because they require extra time and training. Inexperienced owners need a little more coaching than seasoned retailers. This doesn't mean that you cannot get order fulfillment as a small business. You just need the right team to do the job.
To learn more about small business order fulfillment and the other services available with our warehouse, contact Overflo at 1-800-626-0616. We look forward to working with you!
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