Getting goods from a factory or warehouse to the market is not always a walk in the park because the process normally involves many logistics. However, retailers and manufacturers can ease their burden and still keep their consumers happy by using order fulfillment services to store, select, package, label, and ship products to their customers. By outsourcing order fulfillment service to a third party, companies can focus on other aspects of the business such as expansion or developing new products. However, choosing order fulfillment service requires due diligence and as such, some of the important factors to consider while at it include:
You should choose a service provider that can handle your orders comfortably. Remember that orders tend to spike during the holiday season. With this in mind, make sure a service provider would be able to hire extra staff to manage peak season orders. In addition, find out whether an order fulfillment company has the equipment to handle large or complex assembly of product kits since it could potentially make the difference between success and failure of your business venture.
Another important factor that you must consider is the geographical location of the order fulfillment company. Of course, choosing a company that is closest to your target market would see your business enjoy several benefits. To start with, the shipping costs would be considerably lower. Secondly, consumers would not have to wait for long to receive goods. Thirdly, the carbon footprint associated with delivering orders would be considerably smaller. This is a big plus if you operate a business that serves eco-conscious consumers. Whether you operate a local business or a large corporation with a national reach, proximity to consumers is a big factor.
Order fulfillment companies are not immune to making mistakes. For example, some of your consumers might receive wrong orders. Such a mistake can originate in any step of the entire process including packaging, labeling, or packaging. Since such mistakes are virtually unavoidable, find out from a company the percentage of their errors. It would also be wise to ask how the company deals with such errors and the steps it takes, if any, to avoid repetition of such errors in the future. Do not be fooled by figures such as 1% pick error rate. This still means that one in every 100 orders will end up delivered to a wrong client. Considering some order fulfillment companies ship thousands of products every day, these mistakes add up to hundreds of misplaced orders.
The management of an order fulfillment company can make or break your business. Therefore, do not shy from asking the top managers how they convey business philosophies and work ethic to their subordinates. Some of the issues that you should raise include how they measure success, key performance indicators they use, as well as how long they have been in their current posts. If the management does not seem on top of things, consider taking your business elsewhere.
These typically vary depending on the payment schedule used by an order fulfillment company. For instance, while some companies operate on a sliding scale schedule, others charge businesses for every item or order they ship. On top of these charges, you will have to pay a fee to store your inventory at an order fulfillment company’s storage facilities. Therefore, make sure you have a good grasp of all the costs associated with storing and processing orders.
Most consumers love the freedom of choosing from a wide range of shipping options. As such, choose an order fulfillment company that offers shipping options such as FedEx, US Postal Service, and UPS. Find out if the company ships orders to some of the major postal hubs in the US.
Turn Around Time
Once again, this varies depending on a company’s policy. Some companies ship all orders received before a particular hour every day, so if you were to miss the deadline, it would mean your orders would have to wait for the next shipment. With that in mind, find out the turn-around policy so that you can schedule your orders accordingly.
Going by conventional wisdom, you should choose a company that has been in operation for several years. It would also be wise to ask for references and use the Web to check out the company’s track record.
When choosing an order fulfillment service, base your decision on your needs and factors such as location, size, pick error rate, track record, shipping options, and turn-around time. Finally, it should be easy to communicate with the company via email, phone, and web site.