What are the Roles and Responsibilities of Fulfillment Companies?

If your online store sells physical products, you’ve probably taken care of order fulfillment and shipping by yourself at the beginning. However, as your customer base expands, you find yourself spread too thin between marketing, customer support, order fulfillment, and everything else.

When you realize that you can no longer handle everything by yourself, it’s time to entrust the order fulfillment part of your business to someone else- a fulfillment company.

The tricky part is finding a reliable fulfillment company. With so many fulfillment companies in the market, it can be intimidating to choose one especially if you’ve never done it before. In this article, we’ll take you through all you need to know about fulfillment companies to help you choose the best one for your business needs.

What is a Fulfillment Company?

 A fulfillment company is a third-party logistics provider that not only offers a warehouse but also prepares and ships customer orders for eCommerce businesses.

They come in handy for businesses that don’t want to deal with shipping or those that have outgrown warehousing capacity that they can’t do shipping on their own.

The Roles and Responsibilities of a Fulfillment Company

Let’s look at how fulfillment companies work and what they can do for your business.

Inventory management

The first step is getting your inventory to a fulfillment company. You can have your manufacturer or your supplier ship inventory to your fulfillment center. You’ll have to forward shipment details such as the products, quantities, and inform them if they are new or restocked. Make sure all items are labeled with SKU barcode.

If you manufacture your own products, you can ship products directly to the fulfillment company through truck freight or parcel shipping such as FedEx. You’ll notify them about your inbound shipment and provide its details.

Sorting and storage

Once the fulfillment company receives your inventory, they’ll use the shipment detail to sort and check the stock.

Next, they’ll scan your stock into their inventory tracking system. Most companies use an internal SKU system that uses barcodes and scanners. That’s why you need to label your items before you send them to the fulfillment company.

They’ll document damaged or missing inventory and notify you. After that, your goods will move to storage. The fulfillment company will track your sales volume to determine the number of products that will be stored near packing for quick picking and those to be held in the bulk storage.

Process customer orders

Fulfillment companies connect their systems to your online store. This integration automatically routes orders and gets the information needed to ship each order.

If the fulfillment company can’t integrate with the system you have in place, you can use a CSV file. You’ll need to upload a CSV file or an account representative from the fulfillment company will do it for you.

Picking, packing, and shipping

After customer orders are received, the fulfillment company picks ordered items. When picked, the staff scans the products against the order and moves them to the packing area.

At the packing area, the fulfillment company will designate packing materials as well as shipping boxes for safe delivery. Some companies offer customized packaging and kitting at an extra cost. This process is completed by adding order receipts, return labels, or gift receipts.

The boxes are sealed and weighed as they’re prepared for shipping. Fulfillment companies then determine the lowest shipping rate that also guarantees timely delivery. If you have a specific shipping method, your order will be shipped per your preference.

Processing customer returns

Most fulfillment companies handle returns as part of your basic service. However, some companies do this at an extra charge. If you sell goods with a high return rate, you should know that returns processing fees could pile up.

You’ll need to include the address of your fulfillment company on return information in your order paperwork or website. Your fulfillment company will examine the goods and handle them according to your instructions. Resellable goods can be added to the inventory while unused items are scheduled for clearance sale and damaged products are discarded.

Value-added services

Fulfillment companies offer specialty services that come at an added cost. Some of these value-added services include:

  • Kitting products
  • Custom shipping labels
  • Batching orders
  • Custom inserts with special offers or personal notes
  • Custom packaging
  • Temperature-controlled storage
  • Special handling for high-value products

Benefits of Outsourcing Your Order Fulfillment to a Fulfillment Company

Here are the benefits of working with a fulfillment company to handle eCommerce order fulfillment for you.

Cut costs

You’ll be able to avoid long-term warehouse leases as they drain your budget during the slow periods. You’ll only pay monthly for the amount of space your products occupy and services rendered. NextSmartShip provides unparalleled 90 days free storage in our Shenzhen fulfillment center.

Secondly, fulfillment companies are able to negotiate better rates with couriers due to their huge shipping volumes. This way, you’ll be able to leverage their negotiating power on shipping as well as packaging costs.

Furthermore, you will save on the costs associated with hiring and training personnel to fulfill your orders. You’ll be able to rest easy knowing order fulfillment is being handled by the experts.

Allows you to focus on the big picture

Fact is-order fulfillment is a time-consuming process and yet critical to improving user experience. As orders increase and products start flying off the shelves faster from different channels, it will be overwhelming for you and your staff.

When you outsource order fulfillment, you’ll be better able to focus on other tasks such as marketing, sourcing, or even developing and brainstorming better product designs to improve the brand experience for your customers.

As an added advantage, the fulfillment company will also be able to track your sales volume gradually. This helps them determine the number of products they need to be stored in each area. This data will help you to forecast your inventory purchases and avoid having to deal with dead inventory.

Simplify Your Fulfillment Strategy!

When looking for a reliable fulfillment company to handle your order fulfillment, the key factors to consider include:

  • Accessibility of their customer support team
  • Geographic location to your customers
  • If they can handle your specific product needs
  • Ecommerce integration compatibility
  • Growth potential to handle global fulfillment

The best part is that you won’t have to go through endless reviews of fulfillment companies to find one that ticks these boxes. NextSmartShip provides global warehousing with its fulfillment centers in the U.S, Europe, China, and Australia.

 It has the capability of handling packages of any size and weight. It has partnered with most of the big names in the courier industry to help you provide flexible shipping rates.

Another major point is the fact that you get your own designated customer service representative to ease your onboarding process and issues instead of having to explain yourself to every customer service agent you find. If you’re interested to learn more about how NextSmartShip can simplify your order fulfillment process, feel free to contact us today. We’ll be happy to help!

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