It is time that companies revamp their brand presence by offering the best customer experience. One way to do so is to modernize their fulfillment processes. The best way to do so is to accommodate the latest technologies to optimize last-mile logistics. In this article, we will discuss all about automating and accelerating your brand growth with eFulfillment.
Unraveling the Concept of eFulfillment
The term ‘eFulfillment’ is a combination of eCommerce and fulfillment. As such, eFulfillment denotes the process of getting the orders ready for the final delivery. It typically follows a set rule of managing inventory, picking the SKUs, packing them, and shipping the package with a carrier partner.
On a broader scale, eFulfillment forms a core segment in a company's supply chain. It can comprise everything from receiving merchandise in a logistics center to facilitating product returns and exchanges. This includes checking for quality control and restocking them back as inventory.
Thus, eFulfillment is composed of a string of smaller processes that come together to form the final product delivery. More than that, it is a deciding factor in meeting customer expectations. For example, 8 out of 10 customers expect 2-day shipping; 38% of shoppers want on-time deliveries. It is through order fulfillment that you can meet this customer demand.
What Makes-Up eCommerce Fulfillment?
Did you know that 41% of online shoppers worldwide like to pay extra for same-day delivery? In a remarkable study on global consumer insights, PWC found that more consumers are willing to shop online than in 2022. This means that brands all over the globe can expect more visitors. So what is eFulfillment composed of?
eCommerce fulfillment is a stream of tasks that is behind with product sourcing and ends with final deliveries. Here is a chronological flow of the eFulfillment process:
1) Receiving and Managing Inventory
The first step involves sourcing or producing products from retailers in what we refer to as ‘dock to stock.’ It involves selecting a manufacturer or supplier to buy their products and ship them to your warehouse or 3PL center. Thereafter, the inventory is counted, assigned an SKU identifier, and stored inside the warehouse so that they are ready to be picked up later.
2) Processing Orders from Sales Channels
Once inventory is accounted for, they are uploaded as product listings on your website. The next stage in eFulfillment comes into play when an order is received from customers after checkout, i.e., checking stock availability and confirming payment. An order confirmation is sent to the customer. Thereafter, your warehouse gets the signal to start preparing for the order.
3) Preparing the Shipment by Picking and Packing
This next stage is taken up by the warehouse or 3PL centers. After the order confirmation is done, the customer order is sent to your WMS. It then generates a packing slip following which the picker retrieves the required SKUs from the storage shelves. They are then sent to a packer, which is fitted in the right box with a shipping label and sometimes branded packaging.
4) Dispatching the Shipment
Once the order is ready, it’s then handed over to the outbound dock. Here, the shipping station worker examines the shipping labels and hands over the shipments to the allotted carrier partners like FedEx or DHL. The shipping staff is responsible for handover, and the final last-mile shipping stage is carried out by the carriers.
The Secret to eFulfillment Success is in Automation
We can see that the eFulfillment process is a labor-intensive series of tasks. The best way to speed it up while reducing the burden on warehouse workers is to automate certain parts of the overall process. Below is a list of things that can be done:-
1) Optimized Warehouse Operations
Automated technology for warehouses includes a WMS or Warehouse Management Software. A WMS has the most use in optimizing picking, packaging, storage visibility, and resource planning aspects.
WMS improves operational efficiency and minimizes waste, especially during times of higher order volumes. At the same time, it provides improved labor management for scheduling warehouse travel time, designating the best picking flows, and assigning tasks on time to staff.
2) Tools to Streamline Inventory and Online Orders
Inventory management software (IMS) is the best tool for optimizing inventory tracking, reordering, and order processing. An IMS can seamlessly integrate inventory data across all sales channels and monitor inventory levels to alert you when they run low on stock. It also helps you to reduce dead stocks and overstocking possibilities.
3) Technology that enhances Shipping and Transport
A shipping management SaaS tool is the most potent automation system for streamlining the shipping side of your logistics. A cloud-based shipping solution can handle a multitude of your shipping tasks. They include shipping label generation, order tracking from carriers’ systems, updating customers about order status, and much more.
A technologically equipped shipping software like ClickPost can further assist you with its robust automation capacity. This involves smart rules for carrier recommendations, real-time shipment visibility, branded tracking pages, and failed delivery management solutions.
4) The New Age of Robotics and Drones
Collaborative robotics technology, like picking robots, is a new-age addition to automated technology and mechanics. Both drones and robots are the newest additions to a quick commerce culture like one-hour delivery or next-day delivery. In commencing with the on-demand delivery expectations, some big retailers are using drones. Retail giant Amazon has started the Amazon Air Prime using unmanned aerial vehicles (drones) for deliveries.
4 Different Models of eFulfillment
1) In-House Fulfillment
Most small businesses approach the fulfillment process on a smaller scale in-house, i.e., storing and readying orders for dispatch from their office. However, some large-scale brands with abundant capital also use this approach to keep inventory and supply chain control in their hands.
This method is useful for developing a functioning logistics network like an in-house fleet and hyperlocal delivery chain. It’s a beneficial approach for products requiring complex packaging and careful handling.
2) Third Party Logistics (3PL)
The most popular solution for eFulfillment undoubtedly goes to third-party logistics (AKA 3PLs) for outsourcing this part of the logistics cycle. 3PLs, with their expertise in the fulfillment processes of both parcels and cargo, are the best team members for a growing business.
3PLs typically involve inventory storage and management, cross-docking, transportation sourcing (in cases where you don’t have a fixed carrier), order dispatch, and even customs brokerage. The advantages of using 3PLs largely accrue to cost reduction, speeding up the fulfillment time, distributing inventory across a country, and optimizing the returns process.
The dropshipping model involves a rather hand-off approach to fulfillment. Here the fulfillment process is delegated to the supplier of the products, who picks, packs, and ships them on behalf of your business. Dropshipping is a lucrative option for you with low start-up capital.
It does not involve pre-purchasing inventory and storing it, thus, reducing warehousing costs. You only pay for the inventory when a customer order arrives. Therefore, it also lowers fulfillment expenses.
4) FBA (Fulfillment by Amazon)
Fulfillment by Amazon (FBA) is exclusive to Amzon.com sellers. Here Amazon’s in-house fulfillment service handles the product fulfillment and shipping for orders placed in Amazon’s marketplace. All that an Amazon merchant has to do is procure the goods from suppliers and ship them to an Amazon-owned warehouse.
FBA comes into effect as soon as a customer places an order with the brand and order confirmation is sent to them. Retailers can use FBA to leverage their global distribution network and best-in-class delivery system.
eFulfillment is the ship that sails an online business to all of its customers across the country or the world. This is why strategically planning the eCommerce fulfillment process is the only way you can achieve growth. In this article, we discussed the various ways you can automate your business and accelerate its speed to increase fulfillment efficiency and time.
1) What is the importance of eFulfillment?
eFulfillment is the important process via which online retailers ready a shipment to be dispatched to the customer. At least 53% of customers cancel. future transactions with a business in case of one bad delivery experience. Thus, it’s critical for retailers to optimize their fulfillment.
2) What are some good eFulfillment service providers?
A well-built eFulfillment service is one that has multiple warehouses with state of the art facilities and can fulfill large order volumes. They aid in international shipping with customs handling. Some of the best eFulfillment service providers are Fulfillment by Amazon and 3PLs like ShipBob, Kuehne+Nagel etc.