If you’ve ever received your online package tampered or 15 days after placing an order, the chances are that you never went back to purchasing from the same seller. This not so ideal delivery experience maybe because of a lost, damaged or delayed order is a setback for all sellers looking forward to maximizing customer satisfaction.
Furthermore, with eCommerce giants such as Amazon and Flipkart providing one or two-day order delivery, the customer expectations have grown like never before. Statistics suggest that 38% of the customers will never shop again from a seller, following a delivery experience.
With buyer expectations already on cloud nine, eCommerce order fulfillment is becoming a tough nut to crack. And for eCommerce sellers to compete, it ultimately comes down to one thing – order fulfillment strategy.
Table of Contents
What is eCommerce Fulfillment?
eCommerce order fulfillment comprises of multiple processes and all of them lead to a single goal of delivering the product efficiently and affordably to the end customer. The process of order fulfillment can be carried out both in-house and through a third party fulfillment service providers.
No matter how you choose to fulfill your orders, it must cater to the expectations of the customer and not leave you dry concerning your profit margins. A successful order fulfillment thus involves preparing a well-structured strategy and looking out for the best available options in the market.
Put differently, order fulfillment is the key to staying competitive and building customer loyalty in the long run. A recent market statistics suggest that around 45% of the customers abandon carts because of unsatisfactory delivery options. Since ‘normal’ delivery is becoming the least preferred option, eCommerce sellers need to pull up their socks to provide the fastest delivery experience to their customers.
Let’s go through the eCommerce order fulfillment process in detail-
The Order Fulfillment Process
The entire process of order fulfillment can be broken down into the following sub-levels-
Receiving the Order
In case if you’re fulfilling the inventory in-house, make sure there is always sufficient inventory to dispatch on-the-go. On the contrary, if you’re fulfilling through a 3rd party order fulfillment agency, make sure you’ve already gone through all the documentation and process they have to store inventory at their fulfillment center.
The second part of the process is inventory storage, also known as warehousing. Proper inventory storage helps in fetching the products quickly and efficiently. It also gives in-depth visibility to looking for what is available to ship to the customers.
When outsourcing order fulfillment, inventory storage encompasses forwarding order to the 3PL service provider.
Once an order has been forwarded or submitted, it must get processed. Processing an order includes packaging and making it ready for shipping.
One of the most essential things in order processing is applying the shipping labels to the package. While packaging slip notes the quantities and location of each product, shipping labels must be added to ship your package.
Most of the sellers often neglect the importance of packaging in order fulfillment. And this is why most of them end up being charged more by the courier partner or their products ends up unusable when they reach the customer’s doorstep.
To avoid such scenarios, it is best to use fillers in sensitive products and package the product in a box, that is neither too large, nor too small to fit it.
The last and most important aspect of eCommerce order fulfillment is shipping. Market research suggests that for 53% of the shoppers, delivery speed is an important factor when it comes to evaluating their online purchases.
Last mile delivery of orders is also responsible for a majority of your business costs. For this reason, it is to fulfill your orders using 3PL services such as Shiprocket, that helps thousands of sellers deliver their products efficiently at the lowest costs.
Order fulfillment does not end once the order is shipped. A good and satisfactory experience extends to providing sufficient tracking information to the customer along with the preferred payment option.
What Do Your Buyers Expect This Year?
With big eCommerce websites offering one or two-day delivery, buyers expect nothing less than an Amazonesque experience. Shoppers this year, are aware of their options and are constantly looking forward to fast and affordable delivery for their products.
Gone are the days when the buyer was willing to wait for a week to receive their products. With the day by day rise in the expectations of the customers, faster delivery is not just an option, but the need of the hour for small sellers.
But with recent statistics suggesting that 88% of the customers are willing to pay for faster delivery, it’s wise to expect more and more small sellers getting into the quintessential eCommerce order fulfillment picture.
No matter, if you’re selling through your own website, a marketplace or social platforms, catering to your customer’s expectations is the key to more sales and a loyal customer base. It will also help in building your brand faster and drive word of mouth marketing.
How to Form your Order Fulfillment Strategy to Keep Up with the Customer’s E
Pay attention to Location
Even if you’re running an online eCommerce store, neglecting physical location can be one of your biggest mistakes. Location can have a big impact on Order fulfillment even though you’re not selling like a brick and mortar store.
The location of where you fulfill your orders from along with the size of your warehouse immensely contribute to your delivery speeds and costs. And since affordable shipping and faster delivery is a basic requirement for customers, optimizing the location of your order fulfillment warehouse according to your customer’s location can be one of the best decisions you make.
For example, if you ship from one side of the country to the other, not only will it cost you more but also take a significant amount of transit time. However, if you’re regularly fulfilling orders at such distant locations, it will be wiser and more profitable to move your order fulfillment centre there.
Urban fulfillment centers are on the rise as they allow more flexibility concerning shipping time and costs.
Remember the more order fulfillment centres you have near frequent shipping destinations, the more will you profit on shipping costs and delivery times.
Technology to the Rescue
The age of automation has brought a lot of tools in the Commerce industry that can be used to reduce the time on repetitive tasks and better management of inventory.
eCommerce order fulfillment software such as Shiprocket can help in faster and efficient processing of your inventory and making it ready for shipping. This also means that as soon as the order is placed, the fulfillment staff gets notified and the order is picked up by the fastest catering courier of that particular region, in the least amount of time.
eCommerce businesses whether small or large can leverage these smart technology integrations to make informed decisions and streamline the process of order fulfillment.
Stepping-up the Shipping Speed
With rising customer expectations, the demand for same day or two-day delivery is becoming prevalent. Providing low transit times and cheap or free shipping will definitely help you win over customers, but burden you with additional costs.
However, small tweaks in your pricing strategy can land you in a win-win situation.
Here’s what you can do to achieve higher conversions without hurting your profits-
- Incorporate the average cost of shipping in the price of your product.
- Set an order threshold to offer free shipping, such that it is 15-20 times greater than your average order value.
- Choose a smart 3PL fulfillment provider that offers you lowest shipping rates and rapid order management from a unified panel.
While setting a threshold order value can work great for low priced products, baking shipping costs in product prices can only do wonders to higher value products.
Options for Order fulfillment This Year
Also referred to as the in-house order fulfillment method, it refers to an eCommerce seller catering to the entire order fulfillment process on their own. This would include warehousing, managing inventory, packing and shipping without the assistance of a 3PL service provider.
It is common among merchants just starting to fulfill orders in-house however as the business grows it is best to switch to 3PL services and utilize the saved time in acquiring more customers and expanding the business.
Dropshipping is one of the most widely used fulfillment techniques and one of the easiest too. In this process, the seller does not have to deal with inventory on their own. All they do is receive the orders from an eCommerce platform and forward it to the supplier, who then packs and ships it to the customer.
Dropshipping works well with multiple and reliable suppliers or wholesalers. However, since the control of shipping is often in the hands of your supplier, you have seldom control over the delivery timings.
When you fulfill your inventory using third-party services, they either handle the entire fulfillment process for you or just streamline the shipping for you. You can manage your orders using their inventory management tool and ship your orders on the go.
Handing over shipping to third-party providers can help you focus on business-critical strategies such as customer retention, innovation and marketing.
Each 3PL has unique offerings, which you can choose entirely depending on your needs. One of the biggest advantages of 3PL can be discounted rates of shipping and flexibility to form a strategy around it.
For example, Shiprocket lets you choose an affordable courier partner from over 13+ options such as DHL, FedEx, Ecom Express etc. along with helping you reduce your returns. This way you can provide your customers with close to none shipping rates and maximize satisfaction.
Offering fast and affordable shipping to your customers can free you from the worry of one thing- cart abandonment due to delayed delivery.
The reality is that order fulfillment is the backbone of any eCommerce process, without which entrepreneurs cannot fulfill their promise to the customer. And as a business, if you fail to deliver the ideal order fulfillment experience, your customer will look for it somewhere else. So, dive down deep into understanding the needs of your customer and realize the suitability of a particular fulfillment model. With the right strategy and the best tips, you will be able to overcome any challenges in your path.