Online shoppers are growing in huge numbers year after year, and so are their delivery expectations. According to a study, there were 268 million digital buyers in the United States in the year 2022 alone. This number is said to climb up to almost 285 million in 2025.
Also, 62% of online shoppers in the US say delivery speed is what makes for a good purchase experience. This has pushed retailers to double down on their delivery efforts in the last mile.
Despite all the efforts, what’s stopping your retail and e-commerce businesses from providing excellent delivery experiences to your customers?
A new survey from Brightpearl found that 42 percent of U.S. retailers say they have seen an increase in the number of returns and “serial returners” over the last 12 months.
What’s more, 61 percent of the retailers surveyed said they would ban serial returners.
This is an interesting change in an industry that has put so much emphasis on facilitating free returns and exchanges.
Launching an eCommerce business is a thrilling journey with endless potential since billions of people are now buying online across the globe. Numerous eCommerce businesses have skyrocketed thanks to well-crafted content and strategies, growing in fame while also making it easier to acquire customers.
Taking your eCommerce Business to the next level can be difficult, but with a well-executed plan to scale your eCommerce business, there is an abundance of potential for exponential growth!
E-commerce is defined as the buying and selling of products or services exclusively through electronic channels. If you’ve made an online purchase through eBay, Shopify, Amazon (through Amazon FBA), and other platforms, then you have made your purchase via an e-commerce site. More and more people spend their time browsing on the internet and the more likely they are to buy stuff online.
Admittedly, the e-commerce industry is booming. Retail e-commerce sales in the United States are projected to grow at a fast pace in the coming years, going from 322.17 billion U.S. dollars in 2016 to just over 485 billion US dollars in 2021.
Why You Need Order Fulfillment Services
If you’re looking for a business that will eventually get you out of your 9-5 job, or looking to expand your existing business, having an online presence and web-based store could fulfill this goal. For beginners in the e-commerce trade, what do you need to do to get more sales, with a lot of online businesses competing for customers’ attention?
Customers want products that will give the best bang for their buck with speedy delivery, and good after-sales support. Here’s where the different companies offering order fulfillment services come in.
What is an Order Fulfillment Service?
Order fulfillment is defined as the steps involved in receiving, processing and delivering orders to end customers. A fulfillment service is defined as a third-party company that provides these order fulfillment steps on behalf of another party, such as an online seller.
FBA, or Fulfillment By Amazon is a business model wherein e-commerce sellers on the Amazon Marketplace, big or small, can have their products stored in any of Amazon’s giant warehouses, pack and deliver them to customers, handle customer support, and returns.
FBA Pros
Expertise and Reach
Amazon has one of the most advanced e-commerce fulfillment service in the world, can help you scale-up or grow your business and as of the last measured period, the source estimated 90 million paying Amazon Prime subscribers in the United States, up from 63 million in June during the previous year.
Amazon Prime customers are eligible for 2-Day Shipping, Free Shipping and other benefits. If you sign up your products for Amazon Prime, your products are eligible for free shipping, too.
Customer Service and Returns
FBA handles customer service and returns. Listings are displayed with the Prime logo, so customers know that Amazon handles packing, delivery, customer service, and returns.
They handle the fulfillment services side of the business and saves your time, so you can focus on the other aspects of your business.
Multi-Channel Fulfillment
With Multi-Channel Fulfillment, you can fulfill orders from other sales channels using your inventory stored in Amazon order fulfillment centers. Single-source your inventory to streamline your fulfillment operations, manage your inventory through an online user interface and can direct Amazon to return your inventory in e-commerce fulfillment centers at any time.
Cons of using FBA
Customization
Little to no order customization. Sellers must comply with existing Amazon .processes.
Branding
Items are shipped in Amazon boxes. Sellers can ship in generic boxes which may cost extra.
Warehouse Pricing
Storage fees are generally higher compared to 3PLs and usually rise during holidays.
Higher order handling fees for non-Amazon orders.
Communication
Solutions are based in standard processes which may pose little opportunity for dialogue.
Conflict of interest
The fact that Amazon may actually be a competitor to the seller. Amazon is in the business of selling, they just happen to offer shipping services. For Amazon, it’s free product and market research, and they’re making money off you.
Third Party Logistics (3PL / TPL)
Third–party logistics in logistics and supply chain management is a company’s use of third party businesses to outsource elements of the company’s order fulfillment services.
Pros of Using 3PL
Customization
Boxes/bags and all internal packaging are customized to a specific brand. Processes are adapted to your business’ operation and specification.
Warehouse Costing
Attractive storage costs that is variable. Customer pays storage space on a given month. Some 3PLs even offer free warehouse storage for a limited time.
Communication
Has onboarding processes, frequent communication before and after product launch. Collaborative approach is encouraged.
B2B (Business to Business)
Certain 3PLs can handle both B2B and B2C (Business to Consumer) fulfillment, resulting in one e-commerce fulfillment partner for all sales channels.
Cons of Using 3PL
Finding a Trustworthy 3PL company takes time.
Not all 3PL providers are created equal. It takes time to find a good company to work with from the beginning. Once you find someone you can trust, you can rest assured that your goods are being properly cared for. The initial search could be stressful but it will all be worth it once you find a reliable 3PL company.
Bad Service Reflects on Your Company
An inefficient 3PL provider could make your company look bad. Your customers do not care who is in charge of getting the product to them. All they care about is the end result. It is very important to look for a good distribution center early on to avoid customer-satisfaction issues in the future.
Amazon FBA or 3PL in Conclusion
Order Fulfillment Services are a crucial part of your business and a major factor in determining its success or failure. Whether you entrust your fulfillment services to FBA or a 3PL, there is a greater chance that you will be in good hands – these are fulfillment experts, after all. The key difference is you as the owner, – what do you want for your brand and what kind of customer experience you want to give to your consumers.
If you are happy to use Amazon’s existing system and tap into their wide customer reach, FBA may be a perfect fit for your company. If, however, you would like more control over your order fulfillment services, partnering with a 3PL could be the best solution. Make sure your order fulfillment service provider is experienced with the type of operations you need before you entrust them with your reputation.
Amazon FBA article and permission to publish here provided by Dona Dimaculangan at 3p-logistics.co.uk. Originally written for Supply Chain Game Changer and published on March 8, 2018.
Transportation optimization involves analyzing goods shipments, transportation rates, and restrictions to create a plan that reduces the overall costs and makes the process more efficient. Since transportation expenses constitute a bigger percentage of the business costs, business owners should concentrate on optimizing the goods transportation process.
Optimizing the goods transportation process means reducing delays. Here’s how business owners can go about it successfully:
Nations are dropping international trade barriers, making global trade and food importing and exporting more accessible, much faster and progressive. The world is now more connected, courtesy of better transport and communication infrastructure. More business people shift their focus to the food commodity import and export.
Advancements in Technology facilitated the development of more efficient solutions to ease transactions around the globe. It played a huge role in creating an enabling environment for international trade.
According to research, food products like coffee, sugar, wheat and corn are among the top 10 traded commodities globally. The increase in global population, tourism and global movement created the highest demand for food products. It is now common to find a restaurant that offers your local cuisine in different cities worldwide.
My wife recently ordered some nail polish online from a VERY large online retailer. A few days later a large box arrived at the door. Rattling around in this large box were 2 small bottles of nail polish. The overpackaging was absolutely shameful and disgusting.
We’ve written about the topic before, and many years ago. And with all the talk about the environment, sustainability, recycling and waste elimination we would have thought the situation would have improved.
But at least one out of every 4 online orders we receive is subject to overpackaging.
If you look back on the last time you visited an eCommerce store and made a purchase, it was likely sometime this week or during the holiday peak rush. The eCommerce game has changed so significantly in recent years that it’s become a regular part of our lives. For some of your shoppers, eCommerce has a prominent place in their daily activities.
Warehouses play a significant role in businesses that offer goods and products. Whether you have a physical or online store, they’re important since they hold these products and house your inventories but they must deliver a positive ECommerce ROI.
Since they are beneficial in your business, it is only important that you have an efficient system in place. That’s where a warehouse management system (WMS) comes in.
An effective WMS can significantly improve the efficiency of your business’s daily operations and optimize your warehouse’s overall function, as well as your ECommerce ROI.
To begin I must admit that Costco is one of my favourite stores. I started thinking about the Costco Supply Chain.
Stereotypically I almost always buy more than I intended given the unique things that you find in their aisles. And the standard items are invariably great deals, even if the quantities are larger than you will find in other stores.
When you consider the physical layout of the store you are really walking through a warehouse. High ceilings, rows and rows of pallet racking, and concrete floors.
At its core the Costco business structure is a great example of a lot of Supply Chain principles implemented with great efficiency.
What is it that makes Costco’s Supply Chain so effective?
Fans of the well-liked Disney series must own The Little Mermaid Ariel’s collection. There are many different products available in the collection, ranging from toys and apparel to accessories and home goods.
Making a selection for your collection might be difficult, given the abundance of alternatives. Fortunately, there are a few essential items that every lover of The Little Mermaid should take into account.
We all know and regularly purchase Fast-Moving Consumer Goods (FMCG, often also referred to as Consumer Packaged Goods, or CPG). As the name suggests, these are the products that we buy most frequently, such as tinned food, canned drinks, toothpaste, shampoo, soap, biscuits, toilet paper and coffee.
The way consumers bought these products was already changing before the pandemic. Companies like Unilever have been experimenting with subscriptions for several years now and the growth of e-commerce has led to a change in grocery shopping.
But how has the pandemic accelerated changes in the way that consumers find and purchase these products?
As consumers the complexity in the retail supply chain is usually oblivious to us. We go to the store and pick up the goods that we want. Or we order goods online from our devices at home, in the office, or anywhere for that matter. We consume the items, returning them if necessary, unaware of all of the work that went into making those goods available to us.
A phenomenal amount of activity goes on behind the scenes to make this experience as seamless as possible. I am not saying that it always goes smoothly. Sometimes items are broken. They are late. Or there is some other issue.
But behind the curtain that is Retail there are a lot of people managing a lot of processes and dealing with a lot of complexity earnestly trying to make your goods available to you.
Counterfeiters can cause a lot of damage to your Amazon business. They can undercut your prices, skimming valuable profit from your listings. And even worse, they can really tarnish your reputation, discouraging customers from trusting you. Amazon is aware it has a counterfeit problem and has launched Amazon Project Zero.
The eCommerce giant has faced many lawsuits from brands saying that it is not doing enough to fight copycats in the marketplace.
Fulfillment by Amazon is referred to as FBA. Both novice and seasoned online business owners can offer their products to clients via Amazon FBA. Simply ship your goods to the Amazon warehouse to store them there. Amazon handles the shipping of your products to your clients when you make a sale. In addition, they handle client service.
So here we have covered how to start selling on Amazon with the help of Amazon FBA.
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