When To Hire A Fulfillment Company
| By Endeavor Office | 0 Comments
A fulfillment company can be a valuable asset to any e-commerce business. They can take the weight of storing, picking, packing, shipping, and tracking products off your shoulders, giving you more time to run your growing business. A good fulfillment partner ensures that your products are well kept, accounted for, packaged professionally, and are well received by your customers, increasing your customer satisfaction, referrals, and repeat sales.
Deciding to hire a professional fulfillment company is a big decision. You’ve started a business, hired the team, invested in sales and marketing efforts, are actively selling a product, and have a thriving business to be proud of. You’ve got a lot of things on your plate and hiring a fulfillment company has been in the back of your mind for a while now. But when do you hire, who do you hire, how much is it really going to cost, and can you still make money on your product? Don’t worry, we can help navigate the waters of e-commerce fulfillment and when you should get started with a partner.
WHEN TO HIRE
When to hire a fulfillment company will vary from business to business. Everyone has different needs, wants, budgets, and abilities that will factor into the decision of when is the right time to outsource order fulfillment. One of the things we consistently hear is that storing, picking, packing, shipping, and receiving products is the most cost prohibitive part of any e-commerce business. It consumes valuable resources that could otherwise be allocated elsewhere; somewhere to help the business grow.
Here are some of the main reasons business owners hire a fulfillment company
We’ve ran out of storage space.
When you can no longer sacrifice your garage or office space or have outgrown the warehouse you’re currently using, it is a good time to consider hiring a fulfillment company. Leasing another space to keep up with your growing demands can oftentimes be very cost prohibitive. You’ll have to lease the building, maintain utilities, hire multiple staff members, purchase equipment such as racking systems, forklifts, packing equipment, scales, computers, scanners etc. and the expense and headache required may not be worth it. Having a fulfillment partner saves you from investing in unnecessary warehouse space and taking on the burden of the extra expenses.
We don’t have the time.
Time is money! You’re running a growing business, your staff is already busy, and packing boxes and making post office runs is not your most valuable contribution to the company. You should be focusing your efforts on your business. When your staff is already spread thin, and let’s face it, picking and packing orders is the last thing they want to be doing, you should consider a fulfillment partner. It will save you time and money by not wasting your staff’s labor hours on the most tedious task in the building.
We don’t have the staff.
Hiring people is hard. Firing people is even harder. E-commerce comes with seasonal fluctuations in sales, which affects the number of people you need in any given period. One month you don’t have enough help, spreading your already busy staff even thinner or trying to quickly hire extra help, and the next month you slow down and have paid employees with nothing to do, or worse, have to let people go. Hiring a fulfillment company takes all that stress away. They are staffed according to their needs, regardless of the season, and you don’t have to worry about fluctuating staffing requirements to keep your business running smoothly.
We want to save money.
Picking and packing orders is a time-consuming job. Time-consuming jobs cost more money. Labor hours add up quickly and that extra expense can hit your bottom line harder than expected. Hiring a fulfillment company can cut expenses significantly because this is their expertise, just like you have yours. Picking, packing, shipping, and receiving inventory is what they do and they do it well, reducing time, labor, and resources that you may not the able to match. When you want to save money on your e-commerce fulfillment hiring a partner may be the best route.
We don’t have the technology.
If you’re packing orders based on the old school spreadsheet method, you’re likely wasting time and resources compared to those running on an intuitive software system. You spend money in labor processing incoming orders, creating pick lists, printing and tracking paper items, printing shipping labels, and making daily post office runs. The world today revolves around smart tech and most fulfillment companies have it. They have already invested in state-of-the-art software that helps them accept and manage incoming orders, maximize efficiencies, control inventory, and more. This software often comes with a large price tag that is hard to justify when you don’t run a warehouse as your full-time business. Initial start up costs, monthly recurring fees, pay per item costs, and the like can add up quickly. Let your fulfillment company bare that burden for you.
Our orders are being damaged/returned.
There is no faster way to disappoint a customer than to have their package arrive damaged, dirty, or poorly presented. Customers today expect an exceptional unboxing experience, and it is your job to give it to them. If you find your packages are arriving damaged far too often, and therefore being returned, it may be time to hire a fulfillment company. A reputable and professional fulfillment partner will take great pride in knowing your products are well received by your customers as it reflects on both you and them and their growth is dependent upon yours.
It’s taking too long to get orders out the door.
The world today is about instant gratification, and your customers are no different. They want their orders in their hands as soon as possible. If it is taking your team several days to pick and pack orders for shipment, then time in transit, your customers are waiting far too long for your products to get into their hands. Research has shown that people buy (and pay extra for!) products that have 2-day shipping or less. When you’re ready to hire a fulfillment company be sure to find one that offers same day shipping and stays committed to that promise.
We’re too far from our customers to ship efficiently.
Location, location, location. And when shipping products across the country the saying is even more true. If you’re on the east coast and your customer is on the west coast the shipping costs are going to be much higher for you, eating into profits, and time in transit adds up quickly, ultimately disappointing a patiently waiting customer. If you find that more often than not, you’re shipping outside your state and those immediately surrounding you, it may be time to hire a fulfillment company. Look for one that is close to your primary customer base or centrally located in the US to ensure fast efficient shipping to anywhere in the country.
We think we’re paying too much for shipping.
Truth is, you probably are. Professional fulfillment companies have negotiated discounts with all the major carriers far beyond what is offered to the public. You may be paying up to 60% more for shipping than what they are! That adds up fast and hits the bottom line hard. But, when you hire a fulfillment company to help service your customers, they pass their discounts along to you. You save money, save your customers money, increase your profit margins, and end every transaction happy. No more overpaying for shipping and eating into the bottom line with every sale!
Deciding when to hire a fulfillment company may take some time. You will want to evaluate your current needs, plan for future ones, and look at both the resources you currently have allocated to fulfillment and those that may be freed up when you hire a fulfillment partner. It is not the best fit for everyone but if any of the above situations apply to you it should be strongly considered. Having a strong partner can exponentially grow your business by helping fill a gap you may currently have or by simply allowing you and your team time to focus on growth instead of packing orders.
Check out our other posts on who to hire, how much is it really going to cost, and can I still make money on my product.
Endeavor Industries is a strong fulfillment partner that believes in the value of relationships. We want to be more than a just vendor for you, we want to be your long-term strategic partner. We would love nothing more than to discuss your fulfillment needs and see if we can help. Even if we are not the best fit for your current needs, we have a large network of people who may be! Call or email our team to see how we can help!
Endeavor Industries * (405) 456-9967 * Info@EndeavorInds.com