Your Ultimate Guide to Fulfillment Services: Pros, Cons, and Everything In Between
Fulfillment is one of the most critical parts of running an e-commerce business.
The entire customer experience - from placing an order to receiving the product - depends on having a reliable fulfillment operation.
For e-commerce sellers, outsourcing fulfillment can be a make-or-break decision regarding customer satisfaction and repeat business.
According to a Walker Sands Future of Retail report, fast and reliable shipping is the top priority for online shoppers, with 79% ranking it as "very important" or "extremely important."
Shoppers have high expectations for fast delivery, driven by Amazon Prime's 2-day shipping.
Partnering with a third-party logistics (3PL) provider or fulfillment center is becoming necessary to delight customers.
Outsourcing fulfillment enables e-commerce businesses to scale faster while delivering outstanding customer experiences.
With a 3PL partner, you can focus your energy on sales and marketing while they handle warehousing, inventory management, order processing, and shipping.
The proper fulfillment provider makes the post-purchase journey seamless for your customers.
This lets you expand your reach, enter new markets, and keep customers happy.
In addition, fulfillment is the engine that powers e-commerce, and choosing the right fulfillment partner is one of the most strategic decisions you can make.
In this Substack, I'll provide an overview and compare the pros and cons of the top e-commerce fulfillment services: Deliverr, Falcon Fulfillment, Ryder E-Commerce by Whiplash, Simpl Fulfillment, Fulfyld, Badger Fulfillment, Phase V Fulfillment, ShipBob, Amazon FBA, and more.
I'll examine critical factors like storage fees, pick-and-pack costs, shipping rates, integration options, and account management.
Enough about that, let's talk about what really matters.
Well, reading this Substack will give you the knowledge to select the best fulfillment provider for your e-commerce business needs to scale successfully.
Moving right along...
What is E-Commerce Fulfillment?
E-commerce fulfillment companies specialize in order processing and delivery for online businesses.
This process includes:
Receiving and storing inventory
Processing orders
Picking and packing orders
Inserting packing slips
Shipping orders
E-commerce fulfillment services handle the entire order fulfillment process after a customer places an order.
This lets you focus other parts of your business, like marketing, customer service, and product development.
Moreover, fulfillment companies have the warehouse space, staff, and shipping infrastructure to process and deliver orders to customers quickly.
What Are The Benefits of Using Fulfillment Services for E-commerce?
Fulfillment services offer numerous benefits that allow e-commerce businesses to grow and scale.
Here are some of the critical advantages of using a fulfillment service provider:
Expanded Reach: You can sell and ship products to customers anywhere by using fulfillment centers around the country or the world. There is no need to limit your reach to your local area.
Increased Warehouse Space: Outsourcing fulfillment frees up space in your facilities for other business operations like production or office space. Less space is needed for inventory storage and order processing.
Customer Service Assistance: Many fulfillment services provide customer support and handle returns and exchanges, allowing you to focus on your core business.
Reduced Shipping Costs: Fulfillment centers can negotiate better shipping rates than individual businesses based on volume. Plus, proximity to customers reduces last-mile delivery costs.
Customized Packaging and Branding: Get professional packaging and the ability to customize boxes, inserts, and shipping materials with your branding.
Lower Operating Costs: Outsourcing reduces the need to hire, train and manage fulfillment staff. It also reduces overhead associated with warehouse space and fulfillment equipment/technology.
Latest Technologies: 3PLs invest in advanced software, automation, and tracking to speed up order processing and provide real-time visibility.
Streamlined Supply Chain: Expertise in supply chain management, inventory management, and shipping lets you focus on your core competencies.
How Does Fulfillment Work For E-commerce?
Essentially, they have software that connects to your website.
Once an order is placed, they assemble it into a package, scan it, and ship it out.
All this information is communicated back to your website.
So, let's say you are selling shampoo.
You may have different-sized bottles and different scents.
You can send all those directly to your fulfillment warehouse.
Once they get an order, they will pick the size, scent, and quantity of your customer's order and pack it into a shipping box.
Let's Compare the Top Fulfillment Services Available Right Now
When sourcing a 3PL (third-party logistics), there are several services beyond pick and pack to consider. The right third-party fulfillment company will make it easy to integrate your online store.
Many 3PLs partner with top e-commerce platforms to streamline online store integration.
Technology-enabled 3PLs combine shipping with inventory and order management technology. This automates the fulfillment process while providing complete visibility into the entire process.
Some of the best fulfillment company features include:
Seamless integrations
Multichannel fulfillment
Multiple fulfillment warehouses
Easy returns’ management
Cost-effective monthly fees
And that brings me to my next point.
I recommend evaluating fulfillment companies based on how well they can provide the above services and features within your e-commerce business's budget and needs.
The top players excel at integrating with e-commerce platforms, offering multichannel fulfillment across marketplaces like Amazon and eBay, operating large warehouse networks, simplifying returns, and providing transparency into operations through technology.
When researching fulfillment partners, compare their strengths and weaknesses in these critical areas.
This will help you find the fit for your business needs and growth goals. The essential factors are seamless integrations, multichannel support, extensive warehouse coverage, efficient returns processing, and competitive monthly pricing.
Prioritize providers that excel across the board in these categories.
Deliverr
Deliverr is a US-based fulfillment and shipping service trusted by over 12,000 e-commerce brands. They provide nationwide fast shipping through their network of fulfillment centers across the country.
So, let's dive into the details.
Overview
Deliverr offers warehousing, pick and pack fulfillment, and discounted shipping rates through USPS and major carriers like UPS.
Some key features include:
AI-powered inventory and order management
Integrations with Shopify, Amazon, eBay, Walmart, and more
Two-day shipping to 99% of the U.S. population
Free 30-day storage on new inventory
24/7 support
Pros
Fast shipping with low rates
Easy integration with top e-commerce platforms
Real-time inventory and order tracking
Flexible month-to-month pricing
Cons
Monthly minimum fees
Additional fees for custom packaging
Difficult to get inventory back if you leave
Pricing
Deliverr charges a monthly minimum starting at $149. You can also send orders starting at $5.67 per unit. Pre-order, storage, and add-on fees for custom services are also charged.
Overall, pricing is competitive for a national fulfillment network.
Falcon Fulfillment
Falcon Fulfillment is a U.S.-based provider of logistics and fulfillment services.
It offers various fulfillment solutions, including warehousing, inventory management, pick-and-pack fulfillment, and order processing.
Pros:
Extensive Fulfillment Network with 20+ Warehouses Across the U.S. and Canada
Advanced Technology & Automation to Improve Efficiency
Customizable Solutions Based on Your Business Needs
Competitive Pricing with Volume Discounts
Fast Order Processing & Shipping Times
Excellent Customer Service & Support
Cons:
Minimum Fee Requirements May Be High for Small Businesses
Additional Fees for Customization Options
Limited Branding & Packaging Options
Pricing:
Falcon Fulfillment has customized pricing based on your storage, labor, and shipping needs. Overall, costs are competitive compared to other major fulfillment providers.
Volume discounts are also offered.
Monthly minimum fees range from $150 to $300, depending on location. Pick-and-pack fees start at around $0.65 per line item. Additional fees apply for custom services like labeling, gift wrapping, etc.
There are no long-term contracts, so you have flexibility as your order volume changes.
Ryder E-Commerce by Whiplash
Ryder E-Commerce by Whiplash is a third-party logistics provider that offers end-to-end e-commerce fulfillment services.
Pros of Ryder E-Commerce by Whiplash
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