Signs That Its Not Time To Outsource You Order Fulfilment

May 21st, 2013 - Posted by James Hyde to E-Commerce

Signs That Its Not Time To Outsource You Order Fulfilment

Is it worth the cost for SMEs to outsource warehouse and the dispatch of orders when there is a wealth of software available to help you do it yourself? Read below our 7 signs that it’s time to outsource and what services the best order fulfilment houses offer.

1. Time

Is your day endlessly taken up with packing orders? These aren't the only issues outsources can resolve it can save businesses time and money with issues such as storage, customer returns, lost or damaged items and order tracking. A good fulfilment house will take care of this for you and provide you with answers to customer service enquiries at the touch of a button.

2. Flexibility

If you have a huge uplift in orders are you left scrambling for packing space? Do you have a need for additional staff at peak times? Then a fulfilment house could be for you. They will have the capacity and space to deal with peaks. A good fulfilment service will dispatch orders the same day and ensure the customer gets their order on time.

3. Mistakes will Happen

You have a logical system in place but every now and again an order is dispatched incorrectly. Mistakes cost time, money and reputation so choose a fulfilment house with a high pick and pack accuracy that uses additional checks such as barcode scanning and weighing the packed order.

4. Economies of Scale

Do you sell packaged consumer goods such as sunglasses or bespoke, one off’s or irregular items for example antiques or second hand books, then the services fulfilment houses offer is probably not for you. However if you sell clearly defined products in bar coded packaging you will likely find that it will be cheaper to outsource rather than dealing with it in house as the economies of scale in operating specialised picking and packing are generally large.

5. Further economies of scale

Are you spending a fortune on postage and packaging materials? Even though you buy in bulk at trade prices the costs can still eat substantially into your profits. A fulfilment house will always be able to gain better postage rates from carriers as they will be much larger accounts. The same goes for packaging materials which will be purchased in much larger volumes so even if the service charges for packaging as well as postage it will cheaper than the DIY alternative.

6. Are you selling against the clock?

Do you have date sensitive products you are always running the risk of your stock becoming unsaleable. Here’s where the fulfilment house can save you time and money again. They vary a lot on this one, so it’s best to research and find a company which offers goods dispatch in strict rotation. The best services will store and track your batch codes and best before dates to alert you when they could be a potential problem. Not dealing with this yourself will save on that unseen cost of time and with good reporting a fulfilment house will save you losses from stock becoming unsaleable.

7. Do you know what order fulfilment best practice is?

A good fulfilment house does. Just like an accountant, they use their size and experience to ensure that they keep up with the latest standards and invest in the right equipment, materials and training which will ensure orders are packed more efficiently and accurately.

What if you think you're too small to outsource

There is no right volume when it comes to outsourcing fulfillment, a good rule of thumb is if you send around 50 orders per month then you will likely benefit from outsourcing. A good fulfilment house will evaluate your needs and advise if their service will be good for you. If it is, the move will reduce costs, increase your capacity to fulfil more orders and free up your time to win new business.

Do you have questions about outsourcing your order fulfilment? Leave them below and get them answered by James!

 

About the Author, James Hyde

James Hyde is Operations Director at James and James Fulfilment. James is an expert in order fulfilment and systems engineering. His company has reinvented eCommerce fulfilment, find out how.

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