What Startups Need to Know About Order Fulfillment
Startups are usually a little bit of anything. They are small, fast, and flexible. Pertaining to order fulfillment, this can be both a blessing and a curse due to the fact that if, as a startup, you are focused on fast growth and you are ensuring that all customers are happy, you may be tempted to outsource your order fulfillment almost immediately.
However, you do not need to make such a decision in a rush, as there are certain things you should put into consideration before you make the decision. Hence, as a startup, this article contains everything you need to know about order fulfillment.
Order fulfillment is the procedure involved in a product being obtained from its point or place of origin via the distribution means and to the consumer or end user. This can take various forms depending on the kind of product being sold and the needs of the business.
The process of fulfillment includes added services like shipping, managing, and tracking, as well as the processing of returns.
Wholesale fulfillment is a crucial aspect of any business that sells its products online. It enables you to have your inventory where it needs to be in order to fulfill orders quickly and efficiently.
Although order fulfillment is, by definition, how a company processes its sales order to the client’s specifications, that trivializes its essentiality. Clients possess more power than ever, are more aware, and have more expectations.
That said, efficient order fulfillment is vital to your brand’s reputation, your organization’s products, and your ability to keep clients. Without sales, there can be no business. Likewise, without order fulfillment, there can be no sales.
The Process of Order Fulfillment
A new sale is usually nearly something to celebrate. However, the work is not carried out until the order is fulfilled and the customer has the order at hand. Order fulfillment is the crucial task of putting together the order and getting it across to the customer, including the processes that aid those tasks.
The whole lifecycle of order fulfillment consists of five primary steps that start with tactical sourcing and end with shipping. Much of the process involved in order fulfillment can occur under one roof in a properly-organized warehouse, based on the size of your business.
A lot of small businesses manage order fulfillment by themselves in-house by an easy process. It typically involves management of inventory, order processing, supply chain management, quality control, and support for clients that need to report issues or make an exchange or return of goods.
Large enterprises need a more complicated, multiple-layer distribution center method. In either case, the primary goal is efficiently delivering to the clients what they have ordered as quickly, cost-effectively, and dependably as can be achieved.
Products may come from a third party, the department of another company, or an organization warehouse. In any case, the incoming inventory should be numbered, scrutinized, and inventoried to make sure that the adequate amount was received and the quality is acceptable.
Bar codes on the arriving goods can be used to receive and store processes, as well as to retrieve products from internal storage later.
Storage of Inventory
The moment products are received in the fulfillment center, they are usually noted down and either instantly sent to long- or short-term storage. Goods are typically stored just long enough to achieve organization and orderly distribution of products for existing sales, contrary to holding products for future sales.
An order processing management system states the picking and packing activities of goods for every newly received client order. In the online marketplace, there can be an integration of order management software with the shopping cart on an e-commerce website so as to begin order processing automatically.
A team for picking or automated warehouse robots picks goods from the warehouse in compliance with a packing slip’s instructions. The packing slip contains precise information like product sizes, colors, number of units, and location in the distribution center’s warehouse.
Packing materials are chosen by a packing team or automated fulfillment robots to achieve the minimum practical dimensional weight. This is calculated by the multiplication of package length by width and height. Since space on delivery trucks is usually at a premium, maximizing dimensional weight (or DIM weight) is essential to speed transport while minimizing shipment cost.
Additionally, packing teams usually add return shipping labels and materials in case the client wishes to return or exchange the item.
The order is then sent to a transportation channel to be delivered to the client. Carriers and shippers dictate billable freight expenses by anyone greater between the original package weight and its dimensional weight.
Nevertheless, even if the original weight is low, packing it in the lowest DIM is usually worth it to prevent the packaging from adding to the overall package weight. Moreover, the majority of carriers have packaging rules to improve their profits from the shipping space that is available. Failure to fulfill those requirements can delay shipments of carriers do not accept the order.
It is popular for shipping routes to include two or more carriers. For instance, one carrier may pick up a package at the fulfillment center, and another carrier eventually delivering the package to the client’s home. Several reasons are behind this hybrid shipping method. For example, some carriers deliver even to remote areas while others do not.
Processing of Returns
Returns processing starts with adding shipping materials and a return label to the client’s order. However, when a client does return a product either for a refund or an exchange, the process should be carefully carried out to make sure it is fit to restock. Note that soiled or malfunctioned products can not be restocked.
Processing of returns involves quality control checks and sorting out returned goods accordingly.
Start an Order Fulfillment Business
To get started with an order fulfillment business, you need to draw out a solid business plan and map out all the essential details, from facility and technology costs with location plans to business outlook, projection of sales, and the approximate capital to start with and make progress.
Furthermore, highlight your objectives and make a comprehensive plan for receiving, order processing, storage, and shipping methods.
After that, carry out your plan and make necessary adjustments to refine and streamline your business, including enhancement of your profits while consistently increasing customer satisfaction.