What is a Fulfillment Center?
Sometimes referred to as a Distribution center, a fulfillment center is a physical space from which a 3PL (third-party logistics) consistently receives e-commerce inventory to deliver to clients safely and on time. A seller will send the merchandise to a specific fulfillment center while the 3PL receives and delivers them to the customer on behalf of the online store. Inventory management has been a common operational problem for many e-commerce businesses, yet one of the most crucial elements of enhancing customer experience and satisfaction.
Fulfillment Centers Vs. Warehouse—What is the Difference?
Fulfillment centers and warehousing has often been used interchangeably. While their structures and purpose might seem similar, they are quite different. A warehouse stores products for a significantly longer time, while an e-commerce fulfillment center usually offers short-term storage solutions. After all, their goal is to ensure that an e-commerce seller turns over inventory much more quickly. That said, fulfillment centers feature frequent activities and inventory entering and leaving the center every day and eventually being delivered to the final destination, the hands of the customers.
How Does a Fulfillment Center Work?
Receiving Inventory
Incoming inventory must be received in the distribution center, inspected, and recorded to ensure it is in perfect condition and the right amount.
Inventory Storage
Once the goods arrive in the center and are inventoried, they are then either disbursed immediately or sent to short-term storage awaiting delivery.
Order Processing
The order processing management controls the picking and packing activities for the new order. In e-commerce, the order management software can be linked to the shopping cart on the website to automate order processing.
Picking
Inventory is selected from the fulfillment center based on the order’s instructions. The order contains product information, including color, size, quantity, SKU, and location within the center.
Packing
Packing is done to achieve the lowest product dimensional weight for easy shipping while potentially reducing shipping costs.
Shipping
The order is sent to a shipping node or transportation channel to be shipped to the final destination.
Delivery
Third-party logistics have pre-existing connections with renowned couriers and carriers. This translates to reduced shipping costs from economies of scale and the availability of broader delivery options for your clients.
Returns
Fulfillment centers will handle all order returns on your behalf.
What are your Needs?
Whether you want to venture into e-commerce or have been in the business for a while, you have probably thought of working with 3PL in a fulfillment center. Sure, making a sale is worth celebrating. But what next after the order has been placed? You need to ensure that it is safely delivered to the hands of your customers. Well, a fulfillment center will prove effective in meeting your crucial needs including:
· Eliminating the Need for Physical Space
With fulfillment centers, you do not need to manage a physical location for storing and processing your orders. This will enable businesses to cut costs such as rent, bills, packaging materials, and shipment fees.
· Facilitates Seamless Order Picking
The best fulfillment centers can deliver orders much faster than most online sellers can on their own. They provide accurate and more efficient e-commerce fulfillment services and excellent customer service.
· Improves Customer Service and Satisfaction
Many fulfillment centers are available round the clock providing 24/7 customer support through phone, email, handling returns, refunds, and exchanges. Besides, the centers offer guaranteed delivery dates and same-day delivery options. This is done to enhance client experience and satisfaction.
· Offers Scalable Options
Fulfillment centers can manage dozens, hundreds, and thousands of client orders. This facilitates consistent, seamless shipping flow.
· More Time to Focus on other Important Activities
By freeing businesses from managing orders, distribution centers allow companies more time to focus on other vital tasks. You do not have to worry about order processing. Therefore, your primary focus will be enhancing business growth through marketing strategy implementation and bolstering brand awareness.
· Larger Product Selection
Fulfillment centers such as Imagine Supply Chain allow sellers to provide a more extensive product selection than they could have managed if they were handling the inventories themselves.
Customer Support
Once customers hit the order button on your e-commerce business website, they expect to receive their purchase timely and in perfect condition. Your 3PL provider must strive to make that happen. Sure, the center’s staff are responsible for receiving, packing, and picking the orders. A good fulfillment center will give you a knowledgeable and dedicated customer service representative. And since your CSR is constantly working with you, they understand the ins and outs of your business operations, needs, goals, challenges, and internal processes. This allows the representatives to serve as an extension to your in-house team.
Fulfillment is Everything
Online businesses and sales have been growing daily and have become the new normal. That said, your e-commerce fulfillment operations are integral factors that impact your company’s ability to take advantage of the opportunities in the modern business world. Generally, your customer service rep is the bridge between your business and the people delivering your products to the consumers. It is, therefore, that these professionals are in-point. Some of the daily activities of a customer support team include but are not limited to:
- Scheduling orders based on your KPIs for quality, speed, accuracy, and cost
- Instructing and guiding the center’s staff on assembly jobs
- Responding to client queries and resolving various issues
- Working with you to make changes such as developing different packages, kits, and so on
According to research, up to 65% of consumers abandoned a brand after a single unpleasant experience. E-commerce businesses should therefore work with great fulfillment centers with unparalleled customer service and support. This completes the online sales journey and facilitates order fulfillment, keeping your customers happy, satisfied, and loyal.
Services Provided
Fulfillment centers offer numerous services to improve your supply chain performance and make it more efficient, reliable, and cost-effective. Besides the basic receiving, recording, and transportation activities, other services provided include:
Cross Stuffing and Safe Transfer
Cross-stuffing services involve moving products to another location. It can also entail transporting the goods within the container to another destination without damage or delay. The team at the fulfillment center will plan, manage and supervise every step of the process ensuring that the products are safely delivered to their destination in perfect condition.
Sorting and Picking
Once the merchandise is safely received in the center, the staff will timely and accurately pick and pack them based on the unique standard operating procedures. These procedures are identified based on product value, fragility, and composition. Professional packaging lets you relax knowing your goods are protected from damage, loss, corrosion, and weather elements such as extreme sunshine and rain.
Labeling Rework
The need to re-park and label can arise due to various reasons. Sometimes, you might want the product repackaged into branded packaging rather than the manufacturer’s package. In other cases, you want to make an adjustment depending on the client’s specific requests, while in other cases, the original packaging might be damaged. Whichever the case, a fulfillment center must ensure the utmost integrity of the merchandise, facilitate effective labeling, and ensure all crucial details are well and accurately reflected.
Lashing and Crating
If you are looking for a unique, customized packaging option for your fragile or sensitive cargo, working with a 3PL fulfillment center can help. The center’s highly skilled and experienced packaging team are experts in securing and lashing palettized and loose cargo in special containers to protect your product during transit.
When choosing a fulfillment center, it is crucial to ensure that it can meet your business needs and can integrate with your current e-commerce software. This way, you can easily send and track your orders while also relaying your tracking information to your customers.
For your business, look to Imagine Supply Chain to need and exceed your needs. Start your business with us, or make the switch today!