Navigating the Journey: When to Shift from In-house to Outsourced Fulfillment
If your business has grown beyond the garage stage or small industrial space, chances are you've had to make some important decisions about your order fulfillment. You might be managing fulfillment in-house currently, ensuring that your products reach your customers swiftly and correctly. While that might have worked well when your business was smaller, as your business scales, your in-house resources can become strained, potentially affecting customer satisfaction and your own brand’s growth potential. At this juncture, it's wise to consider a national-level fulfillment partner like Verde Fulfillment.
Verde Fulfillment specializes in e-commerce and B2B fulfillment, with a strong focus on optimizing omnichannel fulfillment. With Verde, you gain a reliable partner that can also store and manage inventory, freeing up time and resources for you to focus on business growth and customer relations.
Let's delve into some signs that it's time to make the shift from in-house to outsourced fulfillment.
Growing Order Volumes
With business growth comes increased order volumes. It's a good problem to have, but it's also a challenge if you're running in-house fulfillment. The capacity to store, manage, and ship out growing orders requires larger storage spaces, more staff, and more complex logistics decisions. As order volumes rise, you may start noticing delays in order fulfillment, inaccuracies in order packing, or even mistakes in shipping details, which can seriously impact customer satisfaction and retention.
Now, even more customers cite delivery speed as the most desirable factor in their shopping experience than any other feature. By outsourcing your order fulfillment, any brand can gain access to scalable resources specifically designed to handle growing order volumes. Third-party logistics providers (3PLs) are equipped with the workforce, systems, and infrastructure to ensure each order is fulfilled accurately and timely, regardless of the volume.
Seasonal Peaks
Many businesses witness seasonal fluctuations. This could be holiday shopping for retailers, summer/winter essentials, or back-to-school products. These peaks can place enormous strain on in-house fulfillment, leading to supply chain bottlenecks. A survey by Digital Commerce 360 shows that online holiday shopping grew by 45.2% in 2020 alone. You could employ temporary staff to cope with these peaks, but their training might consume precious time and resources.
Conversely, outsourced fulfillment partners are well-equipped to handle these seasonal changes effortlessly. They can scale their resources up during peak times, ensuring your customers receive their orders promptly, even during the busiest seasons. Their extensive experience and adaptability in handling seasonal changes make them a reliable partner during such high-pressure periods.
Inventory Management Issues
Effective inventory management is the heart of a successful fulfillment process. Maintaining too little stock can result in lost sales opportunities, while excessive stock can lead to obsolete inventory and unnecessary storage expenses. It's a delicate balancing act.
Managing inventory in-house can become increasingly complicated with a growing product line, multiple sales channels, or escalating order volumes. Top 3PLs use sophisticated inventory management systems that track your stock levels in real-time. They can identify patterns and trends in your sales, forecast future stock needs, and manage reordering processes.
Additionally, 3PLs have optimized storage systems to keep your inventory secure and organized, ensuring efficient order picking and packing. Outsourcing means your inventory is in expert hands, preventing overstocking or stockouts, and ensuring your orders are always ready to go.
International Expansion
If your sights are set on international markets, outsourcing fulfillment can be a critical step. Shipping products across borders involves navigating a labyrinth of international shipping regulations, customs duties, and taxes. It also includes dealing with various carriers and handling language barriers. These complexities can consume significant resources and potentially lead to costly errors or delays.
A 3PL with international expertise can simplify this process considerably. They have established relationships with international carriers, knowledge of customs regulations, and systems designed to handle cross-border logistics. This ensures that your products reach your overseas customers as efficiently and cost-effectively as possible.
Shipping Costs and Delivery Times
High shipping costs can be a deal-breaker for many customers. In fact, a survey by the National Retail Federation found that 75% of consumers expect delivery to be free even on orders under $50, up from 68% a year ago. Meanwhile, long delivery times can lead to customer dissatisfaction and harm your brand's reputation. In-house fulfillment often struggles to provide competitive shipping rates and quick deliveries, especially as the business grows.
Outsourcing fulfillment to a 3PL can change that. Third-party logistic companies handle large shipping volumes and thus can negotiate better rates with shipping carriers - savings they can pass on to you. Furthermore, many 3PLs have multiple distribution centers, enabling you to store products closer to your customers. This proximity can significantly reduce delivery times, resulting in happier customers and repeat business.
Knowing When To Outsource
If any of these scenarios sound familiar, it may be time to consider outsourcing your fulfillment operations to a specialized 3PL provider. Verde Fulfillment is committed to taking the stress out of your fulfillment process, allowing you to focus on your core business.
Choosing a Top 3PL partner like Verde Fulfillment not only provides operational efficiency but also lets you leverage their expertise and infrastructure. Verde's omnichannel fulfillment capabilities ensure your customers enjoy a seamless experience, regardless of where they choose to shop. With our focus on B2B and e-commerce, we understand the unique demands of these sectors and deliver accordingly.
Outsourcing your fulfillment doesn't mean losing control over your business. Instead, it's about smartly allocating your resources and focusing on what you do best: creating fantastic products and building relationships with your customers.
Remember, the journey from in-house to outsourced fulfillment is not a mere change of address for your products; it's a strategic decision that can impact your business positively. By partnering with Verde Fulfillment, you're choosing a seamless, effective solution that grows with your business, ensuring you're always equipped to meet your customers' needs and expectations.
The time to shift to outsourced fulfillment may vary depending on your business, but if you're experiencing the challenges discussed above, it might be time to make the transition. Contact Verde Fulfillment today to see how they can streamline your order fulfillment, manage your inventory, and help your business scale smoothly.