Common e-Commerce fulfillment mistakes that are costing you

5 Common Ecommerce Fulfillment Mistakes That Are Costing You Sales

Ecommerce has revolutionized the way we shop. Increasing customer demands and shipping standards require many to find excellent ecommerce fulfillment partners.

While ecommerce is a lucrative segment of retail, it presents some unique challenges. Customers want their orders to be delivered quickly and without difficulty now more than ever.

In this article, you’ll learn the 5 most common ecommerce fulfillment mistakes, and how you can avoid making them in the future.

 

Why is high-quality ecommerce fulfillment non-negotiable?

Ecommerce order fulfillment is one of the most critical components of a good supply chain.

Without it, you risk shipping mistakes, disgruntled customers, damaged items, or, worst of all, a lost customer.

As a company owner who outsources ecommerce fulfillment, you may be unaware of the errors that are costing you money and keeping you from delivering on your customer's expectations.

Any recurring errors made by your fulfillment provider are damaging to your brand's reputation and future sales.

 

“Your most unhappy customers are your greatest source of learning”.
Bill Gates, co-founder of Microsoft

Common e-Commerce fulfillment mistakes that are costing you

 

5 Most Common Ecommerce Fulfillment Mistakes

We’ve highlighted five essential things to consider when evaluating your existing fulfillment provider to ensure success for your brand and company's future.

1. Inventory

Inventory management becomes more difficult as your company grows and handles more shipments. The ability to correctly plan and manage your inventory is fundamental to running a successful business. It's why many scaling companies use an ecommerce fulfillment service provider to help manage their inventory.

However, businesses frequently make the mistake of selecting a fulfillment provider without a detailed inventory system.

It is essential to find a fulfillment partner who can offer inventory metrics such as items in stock, ready to ship, and the number of units left for sale. To keep your inventory in check, your fulfillment partner should provide you full access to these data points.

Fulfillment providers should also follow inventory management best practices, such as high accuracy, fast dock-to-stock times, and essential warehouse management strategies (FIFO, FEFO, LIFO).

Fulfillment companies have a lot to juggle, but the information contained in their systems is what allows them to do it all.

Tip for success: Monitor your business’s inventory carefully to verify your products are in stock and ready for shipment as needed.

 

“Communication is at the heart of ecommerce and community.”
Meg Whitman, CEO of Hewlett Packard

 

2. Communication

Many companies fail at communicating with both their suppliers and their customers. Successful communication ensures costly mistakes are avoided. We’ve outlined some tips for success below.

First, ensure your fulfillment partner is transparent and communicative.

All too often, companies are unable to get responses from their third-party logistics provider, and when they do, care and attention to detail are lacking.

In the long run, finding a fulfillment partner with dedicated account managers, per order billing transparency, and customizable services are priceless.

Maintaining a shared link between you and your fulfillment partner is the best approach to assure accuracy.

Second, communicate with your customers and surpass their expectations.

Retailers have a responsibility to their customers. Products must be delivered on time and budget, whether fulfillment is done in-house or through a 3PL.

As a result, keeping in touch with customers is a priority throughout the ordering, packing, shipping, and delivery processes.

This means giving customers regular updates on where their order is and how close it is to being delivered.

It also includes tracking numbers, easy returns or exchanges, and excellent customer service to improve your client's overall experience.

 

3. Ecommerce Fulfillment Providers

It's a common mistake to assume that ecommerce retailers can save money on fulfillment by keeping it in-house.

To effectively manage online sales, a company must first address a real-time inventory challenge that involves transporting, tracking, and identifying large quantities of physical goods.

To do this, you have to rely on software and reliable fulfillment providers to get the job done for you.

Your ecommerce fulfillment process is the lifeblood of your business. Yet, fulfillment is often served by providers who lack the right data and experience with your brand.

That's why you should take the time in choosing a partner who will help you deliver your best product.

All third-party logistic companies are different. Each handles various transactions, such as retail, wholesale, Amazon FBA/FBM, direct to consumer, and freight/import.

Lack of flexibility may eventually harm your business if the provider you've chosen can only handle individual direct-to-consumer orders and not bulk shipments.

Using a 3PL that can work with your existing and possible future channels is important.

When choosing a 3PL, look for one that can handle D2C sales as well as retail, wholesale, freight/import, and kitting while minimizing expenses. This way, you can prepare for future growth and scalability without having to worry about fulfillment or inventory speedbumps.

"We've been using Falcon for over a year and they are fantastic. Their team is extremely responsive and always up for new and creative solutions for the needs of our company. Most importantly, though, they are deeply concerned about our customers and getting them their products as quickly as possible."
Chaz Shively, Co-Founder at Legendary Ventures

 

4. Damage Control

Once you have a customer, the best thing you can do is ensure they stay happy. This means working hard to provide each buyer with exactly what they purchase, at the time they expect to receive it.

Making your customers feel valued can be as simple as giving updates when problems emerge.

When problems do arise, there are two main ways to handle such situations: communicate with the client as soon as possible and provide quality damage support.

You can do this by offering replacements, refunds, or even a credit on their next purchase. Of course, this isn't always easy, but it’s better to try and resolve things directly with the customer than risk losing them and damaging your reputation.

If you want your company to do well, it's crucial to get it right the first time. That's why it's important to know your company’s damage control measures.

If you have issues with your shipping carriers or refund attempts, this can help you determine exactly what went wrong and how to avoid it from occurring again. It also helps identify potential issues early on, avoiding excessive stress that might harm your company's reputation.

5. Inadequate Customer Service

Customer service is a critical component of any organization.

Poor response times, long wait periods, and complicated refund and shipping processes are just a few of the pitfalls to avoid when communicating with customers. Customers will complain and leave negative reviews if ignored or support was unhelpful.

The purpose of customer service is to reduce these "errors" and create raving fans for your brand. Consider customer service as though it were your most important sales channel and place a premium on it.

Having excellent customer support can result in greater sales and retention rates. Unfortunately, not many organizations have the means or personnel to maintain a continual stream of incoming calls or respond to emails in a reasonable timeframe.

With that in mind, improving your customer service should be your top priority.

In conclusion, no matter how good your product or service is, if your customer service is consistently poor, customers will inevitably turn to others.

 

Falcon Fulfillment might be the right choice for your business.

It's easy to make these costly ecommerce fulfillment mistakes.

It's easy to be unaware of these mistakes, but they are avoidable by identifying them early on.

What matters is to learn from mistakes along the way and use them to improve your business's future path.

Falcon Fulfillment is dedicated to helping ecommerce companies scale. It's why clients choose us for ecommerce fulfillment services. You will gain more revenue per shipment, total billing transparency, customizable packaging, and a better customer experience.

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ecommerce fulfillment

The Secret Tool of Successful E-commerce Brands: An Introduction to Third-Party Logistics and Its Influence on E-commerce

In today’s age of digital shopping and third-party logistics, e-commerce businesses are growing at an exponential rate. With this new technological surge of mass online purchases, it’s almost a bad idea not to get involved and take advantage of the new age of D2C transactions.

In this article, you’ll learn the number one secret to succeeding as an e-commerce brand in a saturating, cybernated environment.

First, it’s important to understand why e-commerce revenue has grown 30% over the last 10 years, and a whopping 43% in the single year of 2020. E-commerce has been around since the late 1960s and has evolved from small information exchanges to globally renowned brands like Amazon, eBay, Etsy, and many more. With the rise of these popular companies, small businesses have harnessed the benefits of e-commerce.

Today, it’s abnormal for a company, business, or brand to not have a website that allows you to purchase their items or services digitally.

“63% of consumers go online when buying locally. 46% say they don’t trust a business without a website.”
- According to the Local Search Association and a survey conducted by Weebly.

timeline of ecommerce

 

As you can see in the condensed graph above, the e-commerce industry steadily grew in popularity after its initial introduction in the late 1960s; however, you’ll notice that between 1995 and 2020, e-commerce took the entire world by storm.

During the global takeover of COVID-19 and the (what felt like) endless days of quarantine, digital transactions produced over $82.5 billion dollars in a single year.

By contrast, e-commerce in 2019 produced only $360 million. This was a 77% increase in one year of e-commerce growth which was previously assumed to take a gradual 4 to 10 years.

This was an unexpected milestone for the e-commerce industry, and brands and businesses alike should assume that e-commerce will become the number one leading industry for retail sales.

In 2020, e-commerce businesses were met with a demand never before seen. As the pandemic spread, seemingly overnight companies were forced to shift 100% online.

Those who did not have an online ordering infrastructure already in place had to scramble for solutions to stay in business.

After such sudden growth, it's no surprise that order fulfillment demands skyrocketed for e-commerce companies. This begs the question, what was the constant factor that brought success to e-commerce businesses during this surge in online ordering?

Their secret was simple: they outsourced fulfillment to a third-party logistics partner. Let's take a closer look at what goes into a seamless and lucrative order fulfillment process.

 

Fulfillment: Joys, Risks, and Fears

“The top factor in successful e-commerce brands is simple: fulfillment.”

The fulfillment process is meant to be the fun part.

You’ve got your finalized product, polished and ready to ship, neatly packed in custom branded packaging to give your buyer a tailored experience. This is the last step before completing the circle and creating a happy, returning customer.

For start-ups, small businesses, and other brands alike, it’s exciting to receive your first few orders and personally send them off.

You get the satisfaction of making sure each one is filled with love and its own personal pazazz. However, as your business grows, 5 orders soon turn to 100, 100 to 5,000.

A single person or a small team can only spread themselves so thin before the quality of the product that makes your brand unique is too saturated from the lack of care and personalization that each order requires. Throughout your business’s journey you will eventually encounter the non-negotiable processes of fulfillment.

Now, it’s always an option to personally handle the picking, packing, and shipping in-house by yourself or by your designated staff. However, managing all 7 stages of the fulfillment process (receiving, inventory, storage, order picking, order packing, shipping, delivery, and returns), as well as maintaining quality and giving equal amounts of attention to the other aspects of your business may result in a subpar experience and product.

It’s important to partner your brand with a carefully selected team of professionals designated specifically for your fulfillment process.

By working alongside a reputable third-party logistic partner, you’re able to shift the extra stress of fulfillment (which is a separate job in and of its own) to experts trained in the art of transferring your product with quality in mind. From the manufacturer all the way to your customers, a 3PL has your back.

 

How Partnering with Third-Party Logistics Companies has Impacted the E-Commerce Industry

Since the 1980s (less than 40 years ago), the fulfillment operations for companies throughout the world have been extremely diverse. Over the years, industries emerged to give businesses an extra hand in reaching as many consumers as possible with the highest quality retained.

However, none of these industries have proven to be more successful than the introduction of third-party logistics.

 

history of 3PLs timeline

 

With the integration of e-commerce platforms, the opportunity arose to work with local and foreign 3PL providers that offered unique solutions to the ongoing challenges that companies face when connecting their products to consumers worldwide.

Once introduced, e-commerce fulfillment partnerships have simply improved, now offering designated fulfillment services integrated with leading and robust technology platforms to guarantee a streamlined experience for companies and consumers.

“As of 2013, 86% of domestic Fortune 500 companies use 3PLs for logistics and supply chain functions.”
- According to an Armstrong & Associates report.

Today, e-commerce brands all over the world are using reputable 3PLs to their advantage. Outsourcing e-commerce fulfillment is the industry secret that's taking the globe by storm, from small businesses to Fortune 500 organizations. With the adoption of 3PLs into e-commerce, many brands experience improved volumes of operational efficiency and seller profitability.

Additionally, third-party logistic providers assist in reducing the overall cost of shipping and delivery time, better order accuracy, and ensure a positive consumer experience. Since its inception in the 1990s, 3PLs have taken the challenges of fulfillment and developed an industry of their own, guaranteeing business owners worldwide that their fulfillment procedures will be managed by experienced teams.

 

The Future of E-commerce and Third-Party Logistics Partnerships

With e-commerce more than doubling in popularity since 2019, it is expected to continue its climb in the upcoming year of 2022 with little chance of decline in the foreseeable future. As customers race to buy products online, the demand for next-day shipping, sustainable packaging, and personalized orders necessitate a larger need for quality fulfillment with e-commerce brands worldwide.

Without someone to bring quality and close attention to your backend fulfillment, the chances of brand growth remain within the limits of your own capabilities. By partnering with a third-party logistics provider, you give yourself and your brand limitless freedom to create, define, and control each aspect of your business.

The Benefits of Using a 3PL for Your Business

Healthy Profit Margins

By aligning your business with the right third-party logistics fulfillment partnership, you gain the benefit of alleviating the stress of unhealthy profit margins. This decision can save you money on product transportation, warehousing, staffing, shipping, and inventory.

When you partner with an e-commerce fulfillment provider, your cost margin will be considerably lowered, allowing you to realize savings inflation and the financial freedom to reinvest in your company through marketing and product development.

Time Management and Prioritization

When you delegate countless hours of work to a specialized fulfillment team, you will have more time to devote to what is most important to you. The operational element of a business is an area most business owners don't thrive in.

This is because you have expertise establishing and managing your unique brand, not fork lifting and packing thousands of orders in a warehouse. That is why 3PL’s such as Falcon Fulfillment exist: to take the fulfillment off your plate, so you can have the time needed to focus on the front end of the business, worry-free.

Inventory Freedom

Above all else, inventory is the biggest benefit you’ll receive when working with a reputable 3PL. Shipping, packaging, and returns are straightforward. However, if you don’t have the room for your growing inventory, then you won’t see the profit increase you’re looking for.

When working with a 3PL, you leave the inventory worry to them. Growing your brand and increasing your sales with ease can only happen when partnering with a reputable 3PL that will scale with you.

Customization and Quality Assurance

Working with a third-party logistics provider ensures quick fulfillment and backend satisfaction. To have the best scalable possibilities for your company, you can find one that provides many customization options to tailor your brand's fulfillment process.

Collaborate with your 3PL partner to incorporate branded shipment packaging, custom promotional inserts, flexible shipping options, and even environmentally friendly packaging.

There's a 3PL for everything, and one designed particularly for you and your business.

 

Harness the Power of a 3PL Partner

You will, without a doubt, come face to face with fulfillment sooner rather than later in your business journey.

Although it can be a tough process to tackle, it is critical to understand your options as an expanding business. 3PLs and e-commerce have permanently altered the way individuals do business.

The combination of e-commerce with a modern third-party logistics provider enables you to future-proof your business and be ready for whatever the next technological wave of brand success and consumer demands bring.

To learn more about how Falcon Fulfillment can help you scale your business with better fulfillment, click the button below.