1. Overview of eCommerce Order Fulfillment Services in Detail
Ecommerce companies largely depend on order fulfillment and logistics providers for their success. Since the consumer market was flooded with ecommerce retail stores, fulfillment services companies have increased to assist ecommerce stores in their delivery operations.
Ecommerce is a demanding and ever-expanding industry, with customers now expecting nothing less than excellent same-day/next-day delivery and customer service. Juggling so many things single-handedly leaves little room for companies to focus on their core competencies. This is one of the reasons why online stores hire fulfillment service providers to carry out their shipping operations.
2. What is an Ecommerce Fulfillment Service Company?
A fulfillment service provider is a logistics and parcel management company that helps ecommerce businesses fulfill their orders in the best possible way. A fulfillment center's job begins the minute a customer places an order in your store.
Fulfillment companies handle everything that happens until the order reaches the customer's doorstep. A fulfillment center may take care of all or part of the post-purchase customer journey. Therefore, you must choose the right fulfillment service company for the e-store.
3. Top 10 Best eCommerce Fulfillment Service Providers Companies [2023 Updated List]
Fulfillment service providers are a downright necessity if you want to survive in the ecommerce ecosystem. You may have the best product in the market, but it will not help your business if you can't deliver it to your customers in the least amount of time.
Succeeding in ecommerce is all about managing customer expectations and retention. Fulfillment service providers can help online sellers achieve that scale-up. We have selected the best fulfillment centers providing all the services an online store needs for your perusal. Let's dive in!
FedEx is an American multinational company that provides ecommerce fulfillment and supply chain solutions to its customers. FedEx brings shipping solutions to B2C, B2B, and DTC sectors dealing in retail, healthcare, consumer goods, and electronics.
With the FedEx platform, store owners can import their orders across all marketplaces and shopping carts in one place. FedEx handles fulfillment by providing inventory and warehouse management as well. It can help you restock inventory, manage product returns, and ship orders to 220+ countries.
3.2) eCommerce Fulfillment Service by Amazon
Amazon has completely changed the game of ecommerce order fulfillment since it introduced Fulfillment by Amazon (FBA) in 2006. It has hundreds of warehouses or fulfillment centers worldwide, making it much easier for online sellers to reach their customers. Working with FBA is easy, too, and it offers customers free shipping.
FBA manages shipments, picks, packs, and ships them to customers. It can also handle returns in a cost-efficient way. Online stores can directly send their inventory to Amazon warehouses, and they will take care of the rest.
New FBA users can avail of many benefits provided by FBA to first-time users, like free warehousing, free order processing costs, and much more.
DHL (Dalsey, Hillblom, and Lynn) is a part of the German supply chain solutions provider Deutsche Post. DHL is well-known for its warehousing services for ecommerce companies and enterprises. It provides order fulfillment services to over 220 nations in the world.
Its distribution section offers freight forwarding (ocean and air) and direct door-to-door services. For international orders, DHL offers insurance and can clear customs and other formalities on behalf of ecommerce ventures.
The United States Postal Service is the oldest postal organization in a country to have its name in its Constitution. It is one of the major arteries of communication in the United States, working through its several post offices and warehouses. USPS offers packaging, bundling, and specialty shipping services like insurance to e-commerce companies.
It can send orders via Priority Express if the shipment is time-sensitive. For higher customer satisfaction USPS also provides email marketing services and other advertising solutions. USPS appoints a Business Solution Associate to online stores to assist them in finding the right solution for your business at the best price.
3.5) UPS Order Fulfillment Service
UPS (United Parcel Service) brings a fulfillment service to ecommerce businesses at a very competitive price. It works much like Fulfillment by Amazon (FBA) in that merchants are only required to ship their products to UPS. Picking, packing, and shipping are handled by UPS e-fulfillment centers.
The software is easy to integrate with your existing business management system and requires no extra onboarding time. UPS has several warehouses and storage units worldwide, offering faster order delivery.
Aramex is an old name in the logistics industry. It has operations in several countries across the globe and helps ecommerce stores with order fulfillment. Aramex can help small businesses with store management and marketplace integrations with ShopGo, MartJack, Shopify, etc. It provides various fulfillment services for ecommerce businesses of all kinds.
Aside from warehouse management (WMS) and order management (OMS), fashion retailers can use Aramex for label stitching, ironing, adding price tags, etc. Its co-packing, bundling, and kitting services can also be bought at an additional cost.
ShipBob is a logistics firm that provides fulfillment services to ecommerce stores across the US. To use ShipBob's services, an online store must first import all its inventory and order data to ShipBob's platform and then send them its products. It stores your inventory in its warehouses and ships them to the customer from their nearest outlet.
It provides a 2-day guaranteed shipping program that's entirely free of cost for the customer. This reduces cart abandonment issues faced by many online stores. It also enables order tracking on all shipments and can trigger notifications to concerned parties on order status updates.
Rakuten is a global fulfillment provider established in 2001. Its services include shipping, packaging, bundling, kitting, and returns management. Its order fulfillment service delivers products within the United States in 2 days.
They have a service exclusively for small and medium ecommerce businesses called XParcel. It expedites the delivery process without increasing shipping costs for the retailer. It also provides shipping analytics on improving operations to increase revenue and decrease delivery times.
3.9) Red Stag Fulfillment
Red Stag is one of the most famous names in the ecommerce fulfillment sector. It has a massive presence throughout the United States with 2 major warehouses located in Salt Lake City and Knoxville, looking after West coast and East coast fulfillment, respectively.
It provides comprehensive fulfillment services like warehouse security, designer packaging, order processing, and inventory management. It offers same-day delivery services in several locations and manages product returns. It has integrations with all the big shopping carts like Shopify, PrestaShop, BigCommerce, WooCommerce, etc.
Many online sellers love ShipMonk for its ease of access and extraordinary services. This fulfillment company integrates with over 100 virtual storefronts and uses a multi-carrier approach to deliver products to customers. It offers pick-and-pack services along with personalized packaging options.
It can intelligently manage warehouses and inventory for online retailers as well. It offers all these services at highly reasonable rates. Don't believe us. Check out their customer reviews to know more. They also appoint client happiness managers who constantly support online businesses through onboarding. They also offer customer service for customers as a value-added service.
4. Top 5 Challenges faced during eCommerce Order Fulfillment
Since the fulfillment process contains several steps and parties and involves the package exchanging several hands, the ordered item is exposed to several risks. These risks can delay, damage, or even cause loss of items during the fulfillment process. Let's look at some of the most common challenges faced during eCommerce Order Fulfillment.
4.1) Inaccurate Information
Companies often face the issue of inaccurate shipping information. This happens when the seller wrongly records the information of the end consumer, and attaches the wrong shipping information to the shipment before handing it over to the logistics partner.
Incorrect information can include anything from wrong addresses to a different address and even an incorrect contact number, which may prevent shipping partners from having the information required to deliver an item.
4.2) Pre-Shipping Delays
When the customer orders, the seller records such requests and sends the information to the warehousing or other storage unit. These requests are then processed, and the ordered product is picked from the warehouse, packed, and dispatched through the shipping partner.
However, companies often face delays before the item is shipped. In several instances, the order takes longer than usual to be packed or even gets the wrong type of packaging, which requires a redo. This causes unnecessary delays at the start of the fulfillment process and causes a ripple effect throughout the fulfillment cycle.
4.3) Shipping Exceptions
One of the most damaging events during the fulfillment process is the occurrence of shipping exceptions. These events cause unnecessary delays due to stuck shipments, adverse weather conditions, customs delays, etc. Shipping exceptions are often caused by unavoidable circumstances and often require the attention of both the merchant and the shipping partner to resolve.
4.4) Inconsistent Inventory Management
When a customer places an order, inconsistencies in the inventory management system may allow users to place orders for more than items that are presently available for sale. This causes items to be overordered, requiring sellers to make purchase orders to acquire ordered items causing long delays in the fulfillment process.
Companies often place purchase orders in advance to prevent such delays. However, with inaccurate inventory management systems, companies may need to place purchase orders with a smaller buying window that hinders customer experience and increases the purchase cost.
4.5) Returns Management
The eCommerce industry is plagued with returning orders, with customers often returning items without cause. For sellers, this means the product would cost twice the money for shipping and cause a loss of revenue. Further, since the product is exposed to transit risks again, companies must also lose the item to damage or theft during transit.
5. Top 5 ways to improve eCommerce Order Fulfillment
With several challenges in the way of eCommerce Order Fulfillment, it is easy to become overwhelmed. However, all is not lost. Here are some ways companies can improve their eCommerce Order Fulfillment process and enhance their customers' experience.
The ultimate goal of the fulfillment process is to communicate with the end consumer. As companies increasingly depend on technology to provide their services, they must communicate with customers through different channels to ensure that their products are safely and timely delivered. Further, communication can help sellers identify shipment issues faster and resolve them early in the process, providing a great experience.
Companies can deploy automated tools to do the bulk of the work in the fulfillment process. When companies automate tasks, they reduce the chances of human error hindering order fulfillment and allow teams to focus their efforts on strategic ventures. Further, automation will enable companies to keep business operations on track by completing activities such as placing purchase orders, managing shipping partners, updating inventory statistics, monitoring exceptions, and sending notifications.
Companies must strive to improve the visibility of their shipments. Through enhanced visibility, companies can eliminate exceptions from the shipping process by resolving issues in advance. Visibility also helps track the progress of a fulfillment process to send relevant information to both the seller and customers. This lets sellers know their shipment status and ease customer anxiety.
5.4) Strategic Warehousing
A key component in the fulfillment process is warehouses and distribution centers. These locations help companies store the bulk of their items in a single location and distribute it through shipping channels to the end consumer.
One of the best ways to improve order fulfillment is to optimize inventory location with warehouses' help. To reach customers more efficiently, companies can store their inventory in strategic locations based on demand for the product and connectivity. This allows companies to dispatch items efficiently and reduce the average shipping cost per item.
5.5) Choose the right Order Fulfillment Service Provider
Finally, choosing the right service provider is one of the most important considerations when improving the overall order fulfillment service. The right service provider can help companies improve fulfillment performance, monitor growth, scale business, and save on the cost of order fulfillment. Further, the correct order fulfillment service provider can help companies improve customer experience and help improve conversation as well as retention rates.
6. How to Choose the Best eCommerce Order Fulfillment Services Provider Company for Your Online Store?
An ecommerce store needs to keep a few things in mind when choosing a fulfillment company to manage its shipping operations. Let's take a look at what those are.
6.1) Speed of Delivery
Part of outsourcing shipping to fulfillment companies is to enable faster deliveries to customers. Extensive improvements in supply chain management have made it possible for significant marketplaces like Amazon to offer same-day and next-day shipping services easily. The Amazon effect has made customers demand quick and efficient delivery like never before. Make sure your fulfillment provider is capable of delivering on that promise.
6.2) Availability of Warehouses near the customer base
Fulfillment centers can only make speedy deliveries if their storage houses and warehouses are near the customer's address. The more warehouses a fulfillment provider has in an area, the faster it can ship products to customers. While choosing the fulfillment company, remember to find out where their warehouses are located.
Your fulfillment center should have warehousing options in your customers' locations to reach them faster. If your store also sells internationally, talk with your provider well in advance about their warehousing capabilities in the destination countries.
6.3) Difficulty in Onboarding
Fulfillment service providers generally use software or Order/Warehouse Management Systems (OMS and WMS) to provide shipping services at attractive rates. Before finalizing a fulfillment provider, talk to them about their shipping software. Also, please find out about the onboarding or installation process, its level of difficulty, and how long it takes. You would want to go for an e-fulfillment provider with the least complicated software offering easy integrations and no onboarding time.
6.4) Shipping Cost
This is a no-brainer. Always try to bargain between the services on offer, the price of the services, and the revenue or profit your store will make by using those services. What an online store should look for at fulfillment shop prices is not the cheapest rates but value for money. You need to determine how much your online store can benefit from the services and then decide the shipping rates you are willing to pay. That would make it a wise and cost-efficient decision.
6.5) Reverse Logistics
As we said before, fulfillment companies are not made equal. Some provide more shipping and tracking options, while others are better at the packaging. Which one to go for depends entirely on the goals of your business. The same goes for ecommerce returns management. Reverse logistics is not a requisite for all fulfillment companies.
Returns are inherent to the ecommerce ecosystem. Having a reliable system to handle customer grievances related to product returns and managing backward logistics can save ecommerce companies a lot of money and time. A returns management system can bring RTO% (return to origin) down over time and improve brand image. However, going for a fulfillment and order management company that looks after product returns is a definite plus.
Shipping is a messy affair. The last leg of the shopping journey can go wrong in numerous ways. A shipment might be delayed, a carrier partner might be unavailable, the customer may have provided the wrong address, and a hundred other things. This is an everyday part of the shipping business. What's important is to find a way to tackle and minimize these issues. An ecommerce venture should look for flexibility in a fulfillment partner to fulfill delivery requirements in the face of an unforeseen event.
6.7) Personalisation options
Customers are looking for personalization options everywhere today. A fulfillment provider you choose should provide customization options for labels and packaging to make receiving shipments an absolute joy for customers. Many fulfillment services also cater to customers' needs with custom-tailored shipping options like delivery date, time, etc.
6.8) Packaging options
All retailers need help with packaging. Your need for boxes and packaging will depend on the industry your ecommerce business is based in. If you ship heavy objects and bulk orders, you should look for packaging services in an ecommerce fulfillment company's service catalog. Packaging can be a massive hassle for an online store. Outsourcing it to 3rd party fulfillment will save you a lot of work and manpower.
6.9) Tracking Visibility
If there's anything customers hate more than a delayed order is the inability to track them. Online stores should maintain complete transparency and order visibility with their customers to ensure they return to their stores. Tracking orders online and receiving real-time order notifications is one of the enormous requisites of customer satisfaction. If you keep your customers in the dark about the whereabouts of their orders, they will never come back to your store.
7. Final Thoughts
Outsourcing order fulfillment to third-party companies is in your best interest. Fulfillment centers may not look like much until you are in the middle of sale season and suddenly have to ship 3000 orders in a day. Moreover, an online store cannot have a presence all over the country, let alone abroad.
To ensure that your customers don't suffer because of the distance, you need to work with a fulfillment provider with more warehouses and a better global network. This is the only way to ensure your delivery times remain the same even as you scale up or your order numbers increase.
Moreover, with a fulfillment company working by your side, you do not need to hire as many staff. This leaves a chunk of your capital reinvesting in the business instead of paying your staff. Lastly, hiring an ecommerce fulfillment company is just easier for online stores. You may feel the pinch in your pocket, but soon the benefits will trump the costs. We hope our selection of top-notch fulfillment providers in e-commerce will help you pick one.