A fulfillment center is a third-party logistics provider that not only offers a warehouse but also prepares and ships customer orders for eCommerce businesses.
They come in handy for businesses that don’t want to deal with shipping or those that have outgrown warehousing capacity that they can’t do shipping on their own.
The Roles and Responsibilities of a Fulfillment Centers
Let’s look at how fulfillment centers work and what they can do for your business.
The first step is getting your inventory to a fulfillment center. You can have your manufacturer or your supplier ship inventory to your fulfillment center. You’ll have to forward shipment details such as the products, quantities, and inform them if they are new or restocked. Make sure all items are labeled with SKU barcode.
If you manufacture your own products, you can ship products directly to the fulfillment center through truck freight or parcel shipping such as FedEx. You’ll notify them about your inbound shipment and provide its details.
Sorting and storage
Once the fulfillment center receives your inventory, they’ll use the shipment detail to sort and check the stock.
Next, they’ll scan your stock into their inventory tracking system. Most centers use an internal SKU system that uses barcodes and scanners. That’s why you need to label your items before you send them to the fulfillment center.
They’ll document damaged or missing inventory and notify you. After that, your goods will move to storage. The fulfillment center will track your sales volume to determine the number of products that will be stored near packing for quick picking and those to be held in the bulk storage.
Process customer orders
Fulfillment centers connect their systems to your online store. This integration automatically routes orders and gets the information needed to ship each order.
If the fulfillment center can’t integrate with the system you have in place, you can use a CSV file. You’ll need to upload a CSV file or an account representative from the fulfillment center will do it for you.
Picking, packing, and shipping
After customer orders are received, the fulfillment center picks ordered items. When picked, the staff scans the products against the order and moves them to the packing area.
At the packing area, the fulfillment center will designate packing materials as well as shipping boxes for safe delivery. Some centers offer customized packaging and kitting at an extra cost. This process is completed by adding order receipts, return labels, or gift receipts.
The boxes are sealed and weighed as they’re prepared for shipping. Fulfillment centers then determine the lowest shipping rate that also guarantees timely delivery. If you have a specific shipping method, your order will be shipped per your preference.
Processing customer returns
Most fulfillment centers handle returns as part of your basic service. However, some centers do this at an extra charge. If you sell goods with a high return rate, you should know that returns processing fees could pile up.
You’ll need to include the address of your fulfillment center on return information in your order paperwork or website. Your fulfillment center will examine the goods and handle them according to your instructions. Resalable goods can be added to the inventory while unused items are scheduled for clearance sale and damaged products are discarded.
Fulfillment centers offer specialty services that come at an added cost. Some of these value-added services include:
- Kitting products
- Custom shipping labels
- Batching orders
- Custom inserts with special offers or personal notes
- Custom packaging
- Temperature-controlled storage
- Special handling for high-value products
Benefits of Outsourcing Your Order Fulfillment to a Fulfillment Center
Here are the benefits of working with a fulfillment center to handle eCommerce order fulfillment for you.
You’ll be able to avoid long-term warehouse leases as they drain your budget during the slow periods. You’ll only pay monthly for the amount of space your products occupy and services rendered.
Secondly, fulfillment centers are able to negotiate better rates with couriers due to their huge shipping volumes. This way, you’ll be able to leverage their negotiating power on shipping as well as packaging costs.
Furthermore, you will save on the costs associated with hiring and training personnel to fulfill your orders. You’ll be able to rest easy knowing order fulfillment is being handled by the experts.
Allows you to focus on the big picture
Fact is-order fulfillment is a time-consuming process and yet critical to improving user experience. As orders increase and products start flying off the shelves faster from different channels, it will be overwhelming for you and your staff.
When you outsource order fulfillment, you’ll be better able to focus on other tasks such as marketing, sourcing, or even developing and brainstorming better product designs to improve the brand experience for your customers.
As an added advantage, the fulfillment center will also be able to track your sales volume gradually. This helps them determine the number of products they need to be stored in each area. This data will help you to forecast your inventory purchases and avoid having to deal with dead inventory.
Simplify Your Fulfillment Strategy!
When looking for a reliable fulfillment center to handle your order fulfillment, the key factors to consider include:
- Accessibility of their customer support team
- Geographic location to your customers
- If they can handle your specific product needs
- Ecommerce integration compatibility
- Growth potential to handle global fulfillment
The best part is that you won’t have to go through endless reviews of fulfillment centers to find one that ticks these boxes.
It has the capability of handling packages of any size and weight. It has partnered with most of the big names in the courier industry to help you provide flexible shipping rates.
Another major point is the fact that you get your own designated customer service representative to ease your onboarding process and issues instead of having to explain yourself to every customer service agent you find. If you’re interested to learn more about how Ecommerce Gateway can simplify your order fulfillment process, feel free to contact us today. We’ll be happy to help!