Delivering the products to each customer is a long process. It starts with a click order from the customer and then experiences a long process to arrive at the door of the buyer safely. With Shopify owners, managing all the processes isn’t easy. Besides, you always need to improve to optimize the steps and time with the aim of the customers can receive goods in the shortest time. Therefore, we will come to today’s topic What is Shopify order fulfillment and its effective strategies for sellers? Let’s flow to dig into more interesting information.
What is order fulfillment?
The act of receiving, packing, and shipping orders refer to order fulfillment. When a customer makes an online purchase from your store, the order fulfillment procedure takes the item they ordered off the shelf, bundles it, and sends it to their address.
What Is eCommerce Order Fulfillment?
The same as conventional fulfillment procedures, order fulfillment in eCommerce starts when a customer puts an order via an online storefront.
These orders may be placed through an online marketplace like BlueCart eCommerce or a website powered by a headless eCommerce platform. On a single platform, you may sell and handle B2B and B2C (B2B vs B2C) orders.
When done correctly, fulfilling these orders can boost eCommerce sales and is a significant source of cash. To ensure that the eCommerce order fulfillment process is carried out appropriately, it must be carefully followed. Systems and software for order fulfillment may be available to monitor this procedure, for example, while delivering orders.
What are the types of order fulfillment processing?
In-House Order Fulfillment
The in-house order fulfillment concept involves a company managing the fulfillment procedures using its own staff. Employees manage every stage of the fulfillment process, including on-site product storage and transportation at a location under business control. For established businesses that seek complete operational control, in-house fulfillment is the best option. In-house fulfillment is a low-cost option used at first by some home-based businesses, especially those with modest order volumes. Many companies switch to outsourced or mixed fulfillment operations as they outgrow their initial premises.
Outsourced Order Fulfillment
A third-party logistics (3PL) or order fulfillment organization will be responsible for shipping, storing, and order/refund processing, then which refers to outsourcing order fulfillment. This is a possibility for businesses that don’t have enough people or storage space. In this instance, the staff of the 3PL manages every step of the fulfillment process, from collecting inventory from manufacturers to deliver orders to the final client. Because inventory is kept in a 3PL-controlled warehouse, businesses that use outsourced fulfillment are spared the expense of building their own warehouse infrastructure.
Although there is no inventory to handle, dropshipping is similar to outsourcing. The retailer doesn’t maintain a stock of the products it sells. Instead, the store buys the product from a third-party source before selling it. The supplier could be a producer or a business that buys goods from producers to resell to dropshippers. The supplier who will have the responsibility to address all orders also sends products to your clients. You only have to pay for the goods you sell. E-commerce businesses and new retailers frequently employ this choice.
A business adopting a hybrid fulfillment model will combine the aforementioned order fulfillment options. For example, a business might employ dropshipping services for non-custom items while processing some orders internally, such as custom items or items that need to be built before shipping. Some businesses opt to employ drop shipping for pricey or bulky items that are infrequently purchased or that they don’t want to store internally. This is perfect for businesses that require more flexibility or are expanding quickly.
Why is order fulfillment important?
Lower prices Using an outside fulfillment firm to pick, pack, and ship orders can frequently help you save money on shipping and operational expenses. For instance, the Shopify Fulfillment Network deal with a large number of orders. Discounted shipping prices are offered by carriers like USPS, DHL, and UPS, and these savings are passed on to eCommerce stores that use the service.
Enhanced clientele service. “[You have to make sure] your clients’ purchases are fulfilled precisely, with the products required, and within a consistent time schedule,” says Bernie Schott, owner, and CEO of REECH. If you fall short on one of these counts, your customers will have a bad experience, which will hurt your business.
Scaling capacity. A time-saving procedure will enable you to concentrate more on business development and growth, particularly if you outsource or automate order fulfillment.
The biggest challenges of Shopify order fulfillment
Inventory control: Running out of products can quickly turn away clients from your store. Companies that are successful in keeping their inventory levels optimal won’t have to worry about losing clients to rival businesses because of stockouts.
Planning for demand: It’s important to understand the demand for the things you sell. Doing this can prevent overstocking (which can be just as costly as understocking). This is where demand shaping, which includes employing marketing and promotions to generate demand, might help.
Logistics planning: The delivery procedure is as least as crucial as the sale itself. You must make sure that things arrive quickly and with care to your customers. Otherwise, you run the danger of receiving late, damaged, or missing packages, which can harm your sales and reputation.
Execution of the supply chain: Even with the finest planning, inventory runs out occasionally, particularly during unforeseen increases in demand. You must be able to quickly restock your inventory when demand causes them to run low. It’s crucial to pick suppliers who can carry out your orders fast.
How the order fulfillment process works
Based on the fulfillment approach you employ, Shopify order fulfillment procedures vary. But to give you a general picture, here is how an eCommerce retailer’s order fulfillment procedure looks:
- Your suppliers deliver inventory to you, which you then keep in a warehouse, stockroom, or storage space.
- A customer uses your eCommerce store to place an online order.
- The order information is sent to your fulfillment team.
- They choose the items for the order, box them, and include a shipping label and returns form.
- The customer’s address is where the package arrives.
- If a return is requriment, the customer posts the package back to the warehouse using the returns label. The fulfillment team now examines the item and handles a return (if it qualifies for one).
Order fulfillment: Best practices to optimize and improve your process
Select the option that will serve you best.
Utilize the fulfillment model first that best fits your company’s needs. To manage your order volumes, customer locations, and sales channels, it should be adaptable enough. Your fulfillment process must be able to handle the complexity of products that are customized or manufactured to order without incurring unneeded delays.
Drive your decisions with data
Real-time data from your technology should enable order fulfillment, giving you access to your inventory and enabling more precise demand forecasting. To meet demand and maintain optimal inventory levels, it is easier to make data-driven decisions regarding purchasing and manufacturing.
Effective and clear communication
You can clearly communicate your delivery expectations to clients if your supply chain is more visible. Be open and honest about the returns procedure as well.
Improve inventory control
The quickness of Shopify order fulfillment is crucial. Customers will be pleasant if you can deliver goods to them more quickly. Localize your inventory to improve your process. With its simple order management system, Shopify makes it simple to handle and complete orders through our platform. To enable quicker fulfillment possibilities, it integrates with retail locations.
Boost your interactions with your shippers
Shipping carrier is an important factor that contributes to How quickly you can deliver goods to your clients. Develop a relationship with them to gain access to special prices and a higher ranking when it comes to customer service difficulties.
That may imply:
- Estimating cargo numbers with accuracy. Many carriers base their rates on the amount of shipment they do. Inform your carrier in advance if you anticipate a spike in orders so they can get ready.
- Proactively approaching communication. Ask your carriers in regular meetings whether there is anything you can do to make their job easier, such as dropping off orders earlier in the day.
- Telling them when something is going well. Those compliments greatly aid in establishing connections.
Take advantage of automation
To better meet your customers’ requirements, use warehouse automation to increase order fulfillment efficiency and accuracy. Collaborative mobile robots are flexible automation solutions that optimize picking routes in real-time, decreasing needless walking and increasing picking effectiveness. Collaborative mobile robots use AI and machine learning to guide warehouse employees through tasks, enabling them to work more quickly while making fewer mistakes.
Here are some clever ideas to automate your order fulfillment process:
- Orders are routed using fulfillment software to the fulfillment location that is most convenient for the customer
- Seeking the location of a product that has to be picked up from a busy warehouse using bar code scanners
- Sending your customer an order tracking link so they can keep track of its whereabouts and anticipated arrival date
This is the end of the topic after we go through 6 main parts:
- What is order fulfillment?
- What are the types of order fulfillment processing?
- Why is order fulfillment important?
- The biggest challenges of order fulfillment
- How the order fulfillment process works
- Order fulfillment: Best practices to optimize and improve your process
You need to take care of the order fulfillment carefully because it’s one of the most important steps which makes your customers whether or not come back to your store. If you do it successfully, you can build a good impression on your buyers, then there are more and more people will choose your business to enjoy the shopping experience. If not it will harm your performance. Therefore, with the topic, we hope we will provide some helpful advice to help your order fulfillment become easier. Don’t hesitate to contact us if you have any questions or find our Shopify customization service to know more information.