How To Optimize Your Shipping & Fulfillment

E-commerce continues to grow at an incredible rate. More so than ever, consumers choose products to buy based on when they arrive. For any company selling to consumers, it’s critical to get your shipping and fulfillment right. Otherwise, it could create a negative outcome for your business in multiple ways. It could cost you customers.

It’s not ideal to simply have logistics set up and hope for the best when sending a package off. Instead, optimize your shipping and fulfillment. That means you’ll take very specific steps to help improve the process. A robust fulfillment operation helps your business scale in growth while meeting customer needs. How do you do it? Consider these strategies.

Put a Complete Solution In Place

Instead of piecing together the shipping and fulfillment process by using numerous providers, streamline it. A complete e-commerce solution allows for the better overall management of your operations. It also simplifies the work that needs to be done. It could even speed up operations because there’s more transparency present.

What is a complete solution? In short, it helps you do it all in one technology solution. That includes everything from finding the least expensive shipping option to managing the sales transactions on the e-commerce platform you are using.

Some of the best solutions handle it all: drop shipping, fulfillment, warehousing, and marketplace management. This can help to streamline the entire process, eliminating common mistakes and errors. If your organization is struggling to balance multiple companies and solutions, it’s likely wasting time and money.

Carefully Consider Fulfillment Center Geography

Another important step in optimizing your shipping and fulfillment is considering the location of your fulfillment center. Location matters because the more distance there is, the more time that’s needed to move product.

The best fulfillment center network typically needs to be able to get product shipped within 2 days, with 1 day being optimal. That means you need to consider where your customers are and which fulfillment networks can offer this prime location.

To make these decisions, consider what is both possible and necessary for your customers. Is it possible to reach 80% of your customers in 1 day? Should just 75% of your customers receive their order within just a couple of days? Do your customers plan to get their order within two days? Examine the promises you’re making to customers. Studies show that consumers want products within 2 days in most cases, with just 10% of consumers willing to wait 5 to 7 days for delivery.

Also, think about competitors. How fast are they delivering? Shipping fast is a competitive advantage. If you can meet or beat them, that’s critical. It builds customer loyalty, but only if you are able to deliver on what you promise.

Improve Your Order Management Processes

For companies selling products, their goal is to do just that – sell as much as possible. The behind-the-scenes of how to make it happen can get lost in the process. One specific area to focus on is order management processes.

Order management processes need to take into consideration your service levels and inventory to help you get products out the door. There’s also the need to have freight costs factored in. Your current order management process needs to be able to take all of the data available and get product shipped fast. It should be automated and efficient.

This means you have to find a way to balance the operational expenses of fast shipping with meeting customer needs to build loyalty. An efficient order management process that takes a lot of the guesswork out of the process can help you drastically.

Balance Freight Costs

A big part of optimizing your shipping and fulfillment is speed. Yet, speed comes at a cost. Most organizations need to find that balance of cost and speed by using software that can help solve their concerns.

Just a decade ago, it would be possible to put the burden of cost onto the consumer. They could pay more for faster shipping. Today, 80% of consumers expect free shipping when they place an order over a certain amount. That means the burden of cost falls on the shoulders of companies more often than not today.

Finding that balance in cost can be worrisome for many organizations. It’s not possible to further cut into profit margins to do this either. One potential solution, then, is to consider technology that can help to optimize your operation by finding and calculating costs for you.

Analyzing costs by location of your fulfillment center as well as order patterns can help. This can create cost savings for most organizations. There are numerous methods for doing this. The key here is to put some focus on how well your current shipping and fulfillment service is working for you. Can it offer the insights and support you need to save money? Is it leading to you overpaying?

Improve Inventory Control and Warehousing

Work to improve your inventory management. A component of that is choosing the best provider for warehousing. Look for one that offers software that automates and streamlines inventory management. That helps to reduce human risk, but it also helps to ensure efficiency. The more time you can cut off from this process, the happier your customers are.

Consider whether you need to duplicate all SKUs at all of your fulfillment locations. That is not always necessary, and when you can reduce this without impacting efficiency, it can save you money. To determine this, you need the right technology that can create a more cohesive plan and one that can pinpoint areas where changes can occur with ease.

Finding the Right Solution for Your Organization

As you consider your current fulfillment and shipping operations, determine just how well you are meeting your goals and expectations. If you are struggling to deliver on time or your costs are rising at a very fast pace, it’s essential to look for ways to optimize.

Choose the Right Shipping Options

One of the most important steps in optimizing your shipping and fulfillment is choosing the right shipping option. A flat-rate shipping method can be a great option for many e-commerce businesses. Flat rate shipping is when you set one fixed rate for all orders, regardless of weight or distance.

This can be a win-win situation for both you and your customers. For you, it’s easier to manage and predict shipping costs. For your customers, they know how much they will be paying for shipping upfront, which can lead to higher customer satisfaction.

This is where the United States Postal Service (USPS) comes into play. USPS offers a variety of flat-rate boxes and envelopes that can help you save money on shipping costs while providing a consistent rate for your customers. And while some may be wondering why to use USPS flat rate boxes and envelopes instead of other shipping options, the answer is simple: they can save you money. This can be especially beneficial if your products are heavier or need to be shipped long distances. Plus, with a variety of box sizes available, you can easily find one that fits your specific shipping needs.

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