An eCommerce business cannot achieve success without an effective order fulfilment strategy. This is the last step or customer touchpoint where your business gets to shine and offer flawless customer experience.
- 38% of online shoppers will abandon their order if the delivery will take longer than a week. (eConsultancy)
- 69% of consumers are less likely to shop with a retailer in the future if a purchase is not delivered within 2 days of the date promised. (Website Magazine)
Your order fulfilment strategy and particularly the delivery or shipping of orders can have a massive impact on your abandoned cart rates and long term customer loyalty. We look at the process, different strategies and how you can remain in control.
The End of the Purchase: Order Fulfilment Process
Order fulfilment is the process of receiving, packing, shipping, and delivering an order to a customer.
Not only is order fulfilment an important last touchpoint to your customer but it can a real costly impact on the bottom-line of your business.
There isn’t an all-encompassing strategy that would work for all businesses, some companies take care of all of their fulfilment processes in-house and other, larger companies, require a third-party to help out with logistics.
However, the eCommerce giants like Amazon have set customer’s expectations really high and customers now always want their package as fast as possible and undamaged. And, of course, companies of all sizes have to deliver on this if they want to keep their customers.
The fulfilment process has a number of important steps for all companies:
- Receiving. Goods are received and stored.
- Storage. Organisation and maintenance of the storage space as a measure for a smooth fulfilment process.
- Processing. Receiving an order and starting the fulfilment process.
- Picking. Picking up the product from the storage location and preparing it for shipping.
- Packing. Grouping of products according to individual shipments.
- Shipping. The package (with the product) leaves the storage facility and is shipped to the customer.
- Returns (optional). In the case of a fulfilment failure, a customer may send a package back as returns. Good order fulfilment strategies need to handle returns with the same priority as shipping out the original product.
Different Merchants, Different Strategies
It is evident that the fulfilment process depends on the product types, size of the business, and order volume. Your company’s strategy, therefore, won’t be identical to every other company’s order fulfilment strategy.
So, before you adopt a new strategy, take some time to consider these important factors.
This may seem obvious, but you need to know your monthly order volume as well as how many products you sell. These factors are all-too-important when deciding on a cost-effective strategy that will keep your business competitive.
For instance, a small retailer with no massive inventory saves a lot of money by handling fulfilment in-house. But, when that same retailer starts growing, it is only logical to outsource this to a 3PL provider.
Remember to always keep growth in mind. A small business has a different order fulfilment strategy than a giant like Amazon, for example.
Moreover, small businesses often experience a fast expansion, so it would be wise to have some kind of idea regarding fulfilment strategies when you start growing out of your current strategy.
Speeding up the process and gaining as much control as possible is often businesses primary goals when it comes to the fulfilment of orders.
When doing so there are three important strategies:
- Inventory classification. Grouping your inventory from fastest moving to slowest moving helps you have the right stock levels on your essential items.
- System integrations (better transparency regarding all aspects of order fulfilment). If you want faster fulfilment of orders, you should gain better insights into several areas (demand forecast, sales, inventory, logistics, etc.). This requires some level of integration between the ERP and the sales order management system.
- Process automation. After your systems provide a better insight into all processes, you should also look at how the processes themselves can be improved and automated.
Every eCommerce vendor should prioritise complete control over the fulfilment process.
If you are selling on Magento, it would be wise to enhance your control with the help of these software solutions:
- Shipstation. A leading web-based shipping software that helps online retailers streamline their order fulfilment. Its features include order importing from over 90 marketplaces and shopping carts, auto-selecting shipping preferences, custom fulfilment rules, multi-carrier label creation, automatic shipping confirmations, and so on.
- Shipper HQ. This tool empowers Magento merchants to drive sales with the customised shipping rates and delivery options customers choose at checkout. In-store pickup, dimensional shipping, multi-location rating, carrier rules, and live LTL rating are just a few of its capabilities.
- Shipwire provides eCommerce order fulfilment, shipping software, and cloud-based logistics services from fulfilment centres around the world.
It is rather simple. The order fulfilment process has to run smoothly if you want functional supply chains that are an indicator of a healthy eCommerce business.
So, consider what kind of order fulfilment your business needs in order to satisfy your customers and ultimately increase sales. Then design a strategy that will align with those ambitions.
And of course, if you need any help along the way, feel free to contact Best Response Media.