The order fulfillment process is a huge part of the ecommerce customer journey. Get everything right, and you will gain customer loyalty and new referrals in return. But when minor inefficiencies litter the process, they can quickly compound into major problems downstream.
To build and maintain your customer base, fulfillment needs to be fast and accurate — while also being efficient and on budget for your organization. Here are a few tips for optimizing your ecommerce fulfillment strategy so you can keep the orders rolling in.
Leverage data to make decisions
Listening to customer feedback is crucial, but it’s not the only thing you should reference when you make strategic decisions.
To understand how well your current processes are working and decide where to make improvements, you need to first analyze various data points. Look to your warehouse management system (WMS), and you can leverage masses of operational performance data expressed as KPIs. The analysis doesn’t need to be complex: simply use automated reporting to track results in real-time compared with the previous month, quarter, or year.
One thing to remember is every KPI won’t be valuable to your business, so focus on the areas of interest to you. For example, KPIs such as order picking accuracy, on-time shipping, and return rates may explain low customer satisfaction.
Also, if you pair those KPIs with customer feedback, another explanation might emerge. Integrating different data sources will provide greater visibility into the workings of your fulfillment process and ensure that every decision gets based on robust evidence.
Reassess your warehousing options
There are many reasons why you might want to change up your warehousing strategy, such as:
Scaling your fulfillment operations — Ecommerce growth in the US continues to climb exponentially. So it comes as no surprise that many operators don’t have enough warehouse space to accommodate influxes in demand for inventory.
Considering relocation — A new location could solve your warehousing dilemma. Though warehouses are scarce, try to avoid impulsively uprooting your fulfillment operation to access more space. Thinking strategically about the ideal location pays off.
For example, moving fulfillment closer to the port significantly reduces the time, cost, and environmental impact of shifting inventory around. Or you could relocate to a city with a large customer base to help meet expectations for fast shipping. Alternatively, opening micro-hubs in multiple locations rather than one large hub can address all those concerns at once.
Access better warehousing technology — A warehouse is only as efficient as its technology. Newer sites are fitted with smart warehousing technology, including IoT devices, RFID, AI, and robotics, that increase the efficiency of your fulfillment operations. Fewer errors and workplace injuries typically occur, which minimizes operational risk.
Reduce warehousing costs — Warehousing costs for space near urban areas have been on the rise as supply shortages drive prices upward. That’s why more businesses are turning to third-party logistics (3PL) partners to help them scale and compete with ecommerce giants like Amazon.
Dissatisfied with your 3PL provider — Providers located on the outskirts of cities can have difficulty ensuring timely delivery, while other less experienced 3PLs lose customers due to poor communication.
If you are contemplating a change in your warehousing, ask yourself whether your current warehouse location(s), size(s), and processes work for your business. If they aren’t, a 3PL partner can help.
Consider working with a 3PL partner
A fast-growing ecommerce business can be a double-edged sword — you’re happy to have increased orders, but you don’t necessarily have the time or resources to keep up. Working with a 3PL partner can help you optimize your fulfillment to keep orders shipping out accurately and on time.
Here are a few of the potential benefits of a 3PL for retail order fulfillment:
Improved proximity — Many 3PL providers are close to major ports for fast order fulfillment and warehouse restocking. Better yet, you don’t have to source your own warehouse space in a competitive market.
Reduced OSH risk — Outsourcing your fulfillment limits your liability for warehouse safety risks. That can be further enhanced when the 3PL provider adopts robotics that reduces the likelihood of serious workplace incidents and fatalities.
Newer technology — A 3PL partner provides access to the latest WMS and other efficiency-enabling technologies without the hefty price tag attached.
Increased responsiveness — With help from a 3PL partner, you will optimize your fulfillment process and keep up with fluctuating order volumes, particularly during seasonal peaks. Your customers will notice the difference.
Your ecommerce fulfillment strategy can make or break your business. But a commitment to process optimization can guarantee your operation performs at peak efficiency with limited intervention. When planning change, use data to inform your decision-making, but don’t overlook the potential impact of alternative warehousing options.
If all else fails, consider working with an experienced 3PL partner like GlobeCon. Let us handle the warehousing logistics so you can focus on running your business and serving your customers.
Want to optimize your order fulfillment with an expert 3PL partner? Contact us.