Ecommerce Fulfillment Services

Fulfilling the Internet order: the options for ecommerce fulfillment.

Ecommerce Fulfillment: Options

Once your website has secured the order, you have to deliver. If you're selling content or electronic goods then you'll have automated the process. The customer just clicks to pay and receive the download. But physical goods involve warehousing, delivery, record-keeping and dealing with queries and returns.

Many companies will be bringing a 'bricks and mortar' operation onto the Internet, and will have their storage, inventory and order facilities already implemented. Ecommerce fulfillment services are a straightforward extension, as long as it's remembered that customers expect painless orders to be followed by painless delivery. Some 40% of customers are in fact dissatisfied by ecommerce deliveries, and 25% never shop again at the site as a result.

Do It Yourself

Small companies just starting on the web may be tempted to store goods in a spare room or garage, but — quite apart from the security and insurance aspects — will generally need a proper shipping department before too long. Goods have to be warehoused and inventoried. Records must be kept — of stock, customers, orders, shipping details and deliveries — and these need to be computerized. Now is the time to find the software that integrates everything seamlessly: orders, inventories, suppliers, customers, accounts, taxes and VAT.

Our fulfillment resources page lists some of the larger suppliers, but you should also consider customer relationship management packages.

Buy from Local Suppliers

Companies won't tie up space and capital by carrying more stocks than absolutely necessary, and many therefore enter into arrangements with local suppliers. Orders are phoned through as needed, collected, packaged and dispatched. Stock levels are communicated to them on a regular basis, and companies have backup suppliers just in case.

Drop Ship from Distributors

The above ecommerce fulfillment system suits many fledgeling companies, but it's still a hassle, taking up much of the working day. An alternative becoming increasingly attractive is drop shipping. Suppliers handle specific brands, and will ship your orders directly to the customer. You just fax or email the drop ship company with the order, and they package with your logo, add the delivery slip, and send it off.

Of course there's a charge for the service, and you have to locate the companies carrying the products you sell. Delivery is very much in their hands, moreover, and they may not keep you fully informed on items temporarily out of stock. Any delays will reflect on you, as customers are unaware of the shipping procedure.

Employ a Fulfillment Company

Further down the road is an ecommerce fulfillment company. The contract you draw up with a fulfillment company requires the company to keep all your products ready for immediate delivery. You email or fax the order — or have it redirected automatically from your website — and the fulfillment company does the rest. Fulfillment companies are efficient, but they are not cheap. We provide directories for them on our resources page, and list those that will serve smaller companies.

Fulfillment Companies: Terminology

Fulfillment companies charge on various bases. Below is the usual terminology. Do your sums carefully.

setup: initial charge to cover cost of preparing to take your products.

order processing: usually a cost per order, plus a cost per item in the order.

Order minimum: what you'll have to pay each month, even with few orders.

receive merchandise: fee for checking shipments.

product assembly: fee for assembling products for you.

restocking: fee for checking inventory level and re-ordering as necessary.

storage: cost of storing items, per pallet or cubic foot.

returns: also restocking fee: charge for items returned by customers.

minimum contract: minimum period your contract runs with fulfillment company.

transaction: charge for handling credit card transactions for you.

shopping cart services: fee for linking your shopping cart orders directly to the fulfillment house.

Consult the e-book for a fuller listing of ecommerce fulfillment services.

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