Choosing a Fulfillment Centre For Shopify Orders And Shipment
Planning to outsource your fulfilment? There are a few things you’ll need to be wary of before going down this route. Luckily, we’re here to help you make the right decision!
Fulfilment centres such as Shipwire are one of several third party distribution companies that handle the product shipping side of your business for you. They deal with the process of receiving, packaging and shipping orders for goods. Some will also handle other tasks such as processing customer payments, provide customer service, etc.
Things to bear in mind!
If your orders tend to consist of a lot of items, particularly cheap items; fulfilment houses will most likely be unsuitable for you as costs will be too high. However, they do provide you statistics which include how many orders you receive in a month, how often are your orders, etc.
Fulfilment companies are best suited for businesses making a substantial amount of profit as they can afford to pay off the necessary costs and fees.
The fees for a fulfilment house!
Fulfilment houses come with a lot of hidden fees. You should consider researching thoroughly about the company and their fees before selecting which one is best for you. The fees include things such as:
Most fulfilment houses charge set-up fees in order to prepare their system for your products. The process of doing this can be costly as it requires plenty of time and labour. You should ensure that these costs are reasonable enough for your business.
Order Processing Fees
The order processing fee is the standard cost for each order. They also charge for every additional item that the company has to package. Therefore, if you ship a lot of low-cost items, fulfilment charges will likely drain out your profits.
Storage fees are charged based on how much room your stock takes up in the fulfilment house’s warehouse. It is charged either per pallet used or per cubic feet. These costs vary from company to company so that is something to look out for.
Most fulfilment houses will handle the returns and refunds of your product. You will be charged for this service so make sure you know what the company charges for return fees as this is often overlooked by most people.
There is also a minimum fee that is required by fulfilment houses to ensure that they are making a profit from performing your fulfilment duties. It is necessary that your average number of orders exceed the minimum fees, otherwise you’ll be losing a lot of profit.
Read their reviews and testimonials!
If a company claims to offer a brilliant service, then it probably has received positive reviews from satisfied customers. Some of these reviews provide great insight into what it would be like to outsource your fulfilment to that company; therefore these testimonials are worth looking into.
However, you should keep in mind that a company will highlight their positive reviews over their negative ones. It is recommended that you do some research on places such as forums, etc. to see what other people have to say about the company and their service.
Businesses that don’t use fulfilment companies need to buy their own packaging supplies (labels, packaging paper, tape, boxes, etc.). Fulfilment companies use more of these materials than a business would use as they can afford to buy them from wholesalers at a significant discount.
Some fulfilment houses will allow you to lower your shipping costs if you pay very low prices for the shipping materials. However, not all companies will; therefore it is required that you research the company beforehand!
The location of the fulfilment centre
If you can visit the fulfilment house in person; that would be highly beneficial for you. Although it is not the most important consideration, you’ll definitely notice the benefits as you have the ability to assess the site and meet with people at the company to discuss necessary things.
Another location factor to take note of; how close is the company from major transport links? This is important as it could mean the difference between your products being your customer in a one day or several. In order to provide the best shopping experience for your customers, it’ll be wiser to choose a locationally suitable company!
Inspecting the facilities of the fulfilment centre
The facilities available at a company’s warehouse should largely impact your decision on which company is best suitable for you. If you can visit the location, that’d be fantastic. If not, you should ask for some photos of the warehouse to ensure that the building is clean and orderly!
Always question their security procedure as any good fulfilment house will be committed to ensuring that there aren’t any issues with theft or misplaced stock. You should also question the training that their staff has received to make sure that they are responsible enough when dealing with your items!
All in all, fulfilment houses are very helpful as they handle everything on the customer-side of your business and are therefore highly recommended for most ecommerce businesses!