Category Archives: Warehousing and Fulfillment Resources

Information about warehousing and fulfillment for those new to warehousing and fulfillment.

The future of distribution is promising for emerging markets

Future DeliveryWe’re at a turning point in the history of distribution—think advances like sci-fi-esque drone delivery. Getting to this point took not only great infrastructure, but also some pretty big technological advances. Plus, it took us a while to get here in the first place.

In a previous article, we explored what the future of distribution has to offer. However, the future of distribution for us, in developed nations, is different than that of emerging markets.

While the major cities of developing countries generally have sufficient (and sometimes equivalent) infrastructure, electrification, distribution networks, retail outlets, and supply chains, the rural areas don’t. So the question our friends at Red Stag Fulfilment got us thinking about was: How will the future of distribution for emerging markets look as a whole?

In this article, we’ll explore the future of distribution in emerging markets, and how it just might surpass our own here in the first world.

How are emerging markets different?

Any effective and efficient distribution system allows customers to buy what they want when they want it, without unreasonable markups. However, when it comes to emerging markets, this may prove difficult given the lack of infrastructure. The quick change of pace, though, is an advantage.

First you have to look at modern cities in developing countries. Surprising to some, these newly built cities often rival our own transportation, communication, and financial systems. Here, modern-day distribution activities chug along and will surely advance as ours do.

However, in rural and remote regions of emerging markets, these systems are far less advanced and sometimes nonexistent. In some places, there’s no internet access, no banks, and no roads. So, how are these people going to become buyers in the market? And how are businesses supposed to reach them? Currently, it’s difficult and sometimes impossible. However, we may see them “leapfrog,” as Red Stag puts it, into the future.

Before any assessments on the future, though, it’s important to examine the position emerging markets are currently in.

3 challenges facing distribution in emerging markets

  1. Transportation

    In developing countries, there often isn’t enough modern distribution for a wide variety of products. The big cities might rival those in developed nations—and even surpass it in some ways—but the rural regions often have poor roads, not enough delivery trucks and no local wholesalers.

    Even if the local distribution system is scraping by, it’s probably increasing the cost for the customer because everything takes more time and effort. To reach modern standards, emerging markets need to invest in not only roads, but airports and delivery point too.

  2. Marketing and communications

    Launching a product in a developed nation is based on a formula of research. To find out the best way to market your product, you simply, and methodically, examine the people—i.e. by age, earnings, education, work history, interest, etc. In a developing nation, this is problematic, mainly because this information often doesn’t exist.

    In emerging markets, statistical data is often incomplete, inaccessible, or has just never been done. So, companies who want to break into a market have to start from the ground up.

  3. Payment

    Computer and mobile payments rely on debit and credit cards, but the people out in rural areas of developing countries often don’t have access to banks. That means that even if people are given internet access or a mobile device, if they don’t have a bank account or credit card, integrated and internet sales are impossible.

    Today, our modern distribution network is all about filling ordersand fast. The fastest way to do so is by electronic payments, so if that’s not an option, fulfillment will be slow.

3 advantages emerging markets have in the future of distribution

  1. Rapid change

    Emerging markets are doing just that: emerging and unfolding before us. Thanks to modern technology, the building up of their cities and infrastructure is taking a lot less time than it did for us in the developed world.

    On that note…

  2. They have the chance to establish efficient, high-tech distribution networks

    Because there was no previous infrastructure in these new cities and rural areas before, establishing efficient distribution networks is actually simpler in some ways. If the new technologies of today prove to be workable, they can quickly grow, spread, and be implemented across developing nations. Emerging markets won’t have to displace, replace, or disrupt modern distribution technologies that are currently in place in developed nations.

  3. They’re mobile-connected

    While developed countries tinkered away at landlines, the developing world often couldn’t scrape together the time, effort, and funds that it took to get that infrastructure in place. So, instead of cutting the cord and moving to mobile like we did in developed nations, emerging markets simply skipped that advancement all together and went straight to cell phones. In fact, today it’s emerging markets that are dominating mobile growth and even cell phone internet usage.

The future of distribution in emerging markets

To get insight into how distribution in emerging markets will adapt to the latest technology, we can actually look to the event above when many developing countries skipped landlines and went straight to cellphones.

This “leapfrog” event proved to be beneficial for the developing world. In the modern American home, the landline is almost obsolete, and increasingly people are shopping on their mobile devices instead of their computers. So as the developed world adapts to mobility, the developing world just builds upon it.

Essentially, this leapfrog effect could play out in distribution systems too, giving emerging markets the upper hand. For example, it might not matter that rural areas don’t have roads to be accessed by trucks. If drone delivery really pans out, these packages can be delivered regardless, since they travel by air.

In fact, it could even be better. Long distance drone deliveries would cut back on the time needed to fly, warehouse and ship out to customers, like the existing, modern infrastructures in place now.

Red Stag looks at this leapfrog effect and the major payment issue to come up with a colorful example of what an order, fulfilment, and delivery could look like in a future emerging market.

“A doctor in a small village looks at his old mobile phone and realizes that he needs a new one. He goes to the distributor website and examines the various models. He decides on a sedate black model, but with the highest amount of memory, and places his order. A window opens with instructions for an encrypted text message transferring the money for the purchase. Immediately after he sends the text, he receives a confirmation text message, and the website confirms the order and a scheduled delivery date the next day at 2:00 pm by drone.

In the warehouse, the order is received and converted to a specific black phone with the required memory. The corresponding phone RFID tag is assigned to the order, and an automated process picks the correct phone from the shelves and brings it to the loading dock. A drone arrives back from a delivery and picks up the item and the corresponding delivery address. It loads the phone and several other items and leaves.

At the scheduled time, the doctor is at the hospital, but on the way home he drops by the local store to pick up his package which the drone dropped off there. He is pleased with his purchase and visits the distributor website to give a good rating and a positive review. Despite being in a developing country, he has received his delivery more quickly than his rural counterpart in a developed country and he has paid lower transaction fees than the 3% to 5% common for online purchases with credit cards.”

In the end, the future of distribution for developing countries is promising, as long as the future technologies we’re talking about actually prove to work. Even if one of these countries is facing tough infrastructure challenges and development issues, the technology we predict for the future can surpass them.

Real-Time Inventory: What it Means and Why It’s Important

Real-time Inventory Management

No doubt you’ve seen plenty of analysis in the business world about real-time technologies and how it’s bringing more immediate results to companies. Whether it’s real-time metrics, marketing, or communications – bringing more immediacy to customers and business associates helps companies make smarter decisions for the future in our fast-paced world.

Similarly, real-time information is critical in your supply chain as well. At the heart of this is properly managing your inventory so your company can effectively re-order product and effectively stock product so that both excess inventory and stock-outs are avoided. The best way to get a handle on inventory is to use software that gives you real-time inventory management capabilities.

Just What is Real-Time Inventory Management?

Real-time inventory management is the process of recording sales and purchases of inventory immediately through the use of a software so that your company gains a complete picture of what’s occurring with inventory, enabling your organization to react quicker to supply chain needs. Rather than periodically updating inventory at pre-determined intervals (usually through the use of inventory counts), real-time systems record every transaction (both purchases of new stock as well as outbound orders and all of the associated costs) in real-time.

The inventory management system serves as the backbone for recording overall receipts and sales of product. For companies that work in a brick-and-mortar environment, point of sale systems provide the technology that enables real-time updates for product sales, whereas companies that sell online will be required to integrate their online sales channels with their inventory system in order to record sales. There are some enterprise level systems that bring all of these functions under one “software platform roof”. Furthermore, companies will oftentimes supplement these systems with other tools, such as RFID (radio frequency Identification) technologies or bar code systems in order to more quickly and effectively record new receipts and sales.

Benefits of Real-Time Inventory

Adding new software and/or supporting technologies to move towards a real-time inventory environment can be a significant expense for companies, so understanding the benefits of moving in this direction is critical for your fulfillment center services. As mentioned previously, the first benefit is that it allows your company to avoid stock outs and excess inventory more quickly than a periodic inventory management scenario. By updating all receipts and sales in real-time, you can tap into up-to-the-minute data, which will enable you to more effectively budget supply and demand of your product. Physically counting inventory on a periodic basis takes more time, and those delays, especially in our age of same day delivery expectations can significantly impact buyer satisfaction.

Which brings us to the second benefit of real-time inventory: enhancing the customer experience. One of the worst-case scenarios is to have a ready, able and willing buyer, only to lose them because you don’t have adequate stock for them to purchase your product in store or online. Not only does this impact your immediate sales potential with that customer, it may also have a negative impact on future sales – not only with that particular customer but potentially with others within their sphere of influence if they decide to share their disdain with others on outlets such as social media.

Third, implementing a real-time inventory system will likely bring some physical benefits to your warehouse as well. First and foremost, this method of inventory management will likely require your warehouse to become more organized. Furthermore, it will also more than likely result in less overall recounts of inventory if diligently managed.

Fourth, real-time inventory is a wonderful asset to your accounting and finance team as well. Knowing exactly how much inventory you need at the right times (and what’s left over) gives you a more accurate picture for the accounting department. Just estimating what your inventory stands at could pose a major rick to the profit reporting you do each quarter. Real-time metrics work to help catch errors immediately so you don’t experience extra downtime scoping out a problem.

Remember – Real-Time Inventory Doesn’t Guarantee Success

Just because you implement a real-time inventory system doesn’t mean that there won’t be mistakes, so knowing the potential risks will better help you avoid any potential pitfalls. For example, theft of product, mis-pick errors, damage to product and recording errors (at the receiving or picking/shipping level) can throw your inventory levels out of balance. Strict adherence to processes and procedures is critical to the success of this type of system. In particular, pay close attention to controls over the receiving process, since an error in this department will only compound problems further on down the sales process. Furthermore, a scheduled quantity of cycle counting will help assist you in more proactively catching inventory discrepancies.

A lot of times, taking the giant leap forward into real-time inventory is daunting for growing companies. Outsourcing fulfillment is a way to tap into the real-time environment without having to make the commitment to purchasing new technologies and management of the additional requirements. Professional third party fulfilment companies specialize in all aspects of warehousing and distribution and will have the necessary software to bring your company from periodic to real-time.

In-House Fulfillment: When it’s Better to Keep Fulfillment In-House and How to Maximize Performance

In-House FulfillmentMany businesses struggle with the idea of outsourcing to a fulfillment center or 3PL warehouse to help save time and money. While many businesses find benefits to this option it is not for everyone. We will outline some reasons why this is not always the best solution, and give you some guidance on how to manage your own fulfillment better. We will also provide a couple of reviews for some products that help businesses perform better on their own.

What are Good Reasons for not Outsourcing?

The first thing that probably comes to mind is cost. When profits are not high yet it might be difficult to start outsourcing fulfillment. When looking to use a fulfillment center there are start-up costs involved, storage costs, charges for movements, charges for employees that they are using to fulfill all of your business needs, etc. When there is not a lot of extra cash flow these costs can be very daunting and to some just not an option at all – especially if you have to rely upon your own time in lieu of paying a fulfillment center. Of course shipping costs can be very high for companies with a smaller order volume which is where a fulfillment center could help you save money, as these companies usually do have a better rate. Look at what costs your company is incurring for all of these services and compare them to the rates of these fulfillment companies and 3PL warehouses and you will find your answer. As a start up, you might have to boot strap it a while until you can afford the cash flow expense of an outsourced solution.

Then there are the businesses that have specific needs that entail too much work to outsource without a large potential for problems. For example, there are many different businesses that rent out clothing on a monthly basis to their customer. When these boxes get returned the clothing needs to be dry-cleaned and inspected thoroughly. Not that this is impossible to outsource, but these unique services will more than likely not be provided by many 3PL warehouses or fulfillment centers. Most outsourced warehouses ship standard goods and anything out of the ordinary could become problematic. Odd sizes and unique requests will add to the cost of outsourcing your business needs. When it comes to these niche companies it will more than likely be better to keep this side of the business under your own control.

Speaking of control, there are also businesses (and their owners) that need a little more control over their process. Outsourcing to a 3PL warehouse or fulfillment center means letting go of part of your own business. If you’ve been handling your own fulfillment and have created a working procedure for yourself, it could be difficult to let go and hand this over to another company. Most fulfillment centers have a streamlined process in order for them to best handle fulfillment for many different companies using their services. It is very important for a business owner to find a company that meets their needs as well as a good partner to work with. This may be hard to find for certain companies so maybe the own fulfillment process could be streamlined better instead of looking for it elsewhere.

How to Manage Your own Fulfillment Better?

If outsourced fulfillment isn’t in the cards, then you need to make sure you are armed with the right processes and systems to do it effectively. Anything can be managed on a very small scale, but as you grow, additional sales will expose any problems in the fulfillment process and will result in potentially catastrophic errors.
So what are the most important things to help your business? In order to be successful with in-house fulfillment you will need well-trained people and the right technology and software. It’s what all of the professional 3PLs and larger companies use to ensure success. While you may not be able to purchase robots to pick orders, certainly bar code scanning and inventory software are affordable options to significantly reduce errors.

When you look around you will find quite a few fulfillment software platforms to help you manage your business better. These software platform companies know that not every business is going to fall in line with outsourcing to a fulfillment facility. As such it can be overwhelming for you to try to find something that works right for your business. One of our recommendations would be to seriously consider other alternatives before using any shopping cart plug-ins. While these do have their pros and cons, you may run into trouble with these in the long run. The positive aspects are reasonable prices, free trial periods, no selling limits and unlimited storage. On the negative side, they may lock you into inflexible work flow processes that either set your company up for errors to take more time to process, and the customer service is sometimes erratic. They also frequently charge you with transaction fees, something you’ll see add up dramatically as your order volume rises. In addition, many of these services don’t offer refunds, bringing nothing but a money-losing risk when you need to gain the most profit. You need to find something with dependability and experience, as well as scalability. Lastly, it’s smart to avoid any service locking you into a contract, despite seeming impossible to find.

What to consider for In-House Fulfillment Software?

If not outsourcing is the right choice, you need to look beyond and see what tools you can use to make fulfillment work better in-house. You’ll need something that will fully integrate with your existing systems to avoid transition problems. In our quest to help businesses find what is the right fit for them we’ve started reviewing some of these Software platforms.

ShippingEasy

We will start with ShippingEasy.com which has many benefits to using their service as an alternative to outsourcing. There are various packages available with the premium package costing $ 99 a month for businesses shipping up to 6,000 orders a month. The full list of plans can be seen here including the free Starter plan up to 50 orders and the Enterprise plan for unlimited orders. This comes with an account manager and comprehensive training. All you need to get started is an internet connection and you can access your account on your web browser. It does seem to live up to its name in being easy to use. The interface is easy to navigate as everything is clearly marked. The workflow will help you enter your orders into the system. You can set your own parameters such as carrier, weight, dimensions, etc. The printing page will help with packing slips and shipping labels and such. All in all, most reviews will tell you that shippingeasy.com really is as easy to use as they promise. There are only a couple of things that you might want to consider beforehand. You may want to speak with an account manager if you ship irregular packages as the system only accepts length, width, and height. Also, the best shipping rates are on the Plus and higher plans (which offer Flat Rate Green, ShippingEasy’s proprietary cubic rates) – though the Basic plan offers Commercial Plus Pricing and the Starter plan offers Commercial Base Pricing (all of which are less expensive than the retail counter). They integrate with the biggest and most used platforms such as Ebay, Amazon, Shopify, Etsy and Volusion, etc. The full list of integrations is here. They offer reporting as well as inventory management. Their order management is in real-time and they give you a customizable view of order details. Another feature is that it syncs shipping status and tracking info back to online stores and sends an automatic confirmation email to customers with full tracking info. There are many other features and integrations but we encourage you to check them out and maybe even start with their trial program if this feels like the right fit for your company.

ShipStation

Secondly, there is Ship Station. Just like the above it offers many different packages and pricing is not much different. For their platinum package they are charging $ 95 a month for shipping up to 6,000 orders a month. This is also entirely web-based so you only need an internet connection. However, the interface seems to be more difficult to navigate than Shippingeasy.com. There are many options and it will take some extra time to find your way around but there is also a dedicated account manager as well as many forums to help you navigate the interface. It may be a little more difficult to find your way but it does offer you a way to customize your interface so you can have it set up the way you would like to see your information in front of you. Also their reporting is much more comprehensive. You can pull up reports for almost every aspect. It integrates with all of the biggest platforms as well and also syncs shipping status and sends tracking info direct to the customer. Many of the features are the same as the other software we reviewed above but there does seem to be a difference in dealing with customer service. It can take up to one business day to have certain issues resolved.

Both Shippingeasy.com and Ship Station have many similarities so it would come down to whether reporting and customizable interface are more important such is the case with Ship Station or if having a quicker customer service such as with Shippingeasy.com is the case. We will start reviewing more companies and software that could potentially help your business so please keep coming back for more information and reviews.

Interviewing E-fulfillment Companies: What Questions Should You Be Asking?

Questions to Ask Your E-Fulfillment ProviderShopping for any business service is a high-stakes evaluation, especially one that affects the value delivered to your customers. For e-commerce businesses, one of the critical arteries supplying the lifeblood to your businesses is the choice of fulfillment provider. After all, the chosen fulfillment company will be responsible for receiving, storing, picking, packing, and shipping your product to customers. Essentially, the fulfillment company is responsible for ensuring that the value created by your marketing team, web developers, product engineers or procurement team, and customer service representatives, is actually delivered to your consumers in the expected condition, as fast as possible, without any flaws.

WarehousingAndFulfillment.com can be incredibly valuable in assisting e-commerce business owners through the process of finding the best e-fulfilment company. However, once you have your options narrowed down to three or four potential providers, what questions should you be asking in order to reveal the company that will provide the highest level of value to your brand?

How an E-Fulfillment Company Became a Fulfillment Company

We recently had an opportunity to speak in depth with Jake Rheude of Red Stag Fulfillment – an e-fulfillment company that was born out of this exact situation. When the ownership of an e-commerce company spent years unable to find a high-quality fulfillment provider that cared as much about delivering value to customers as they did, the decision was made to attempt to build the fulfillment provider they could not find.

One of the tools used to guide the development of Red Stag was a checklist that had been developed by their e-commerce sister company, which served as a set of “interview questions” used to evaluate potential fulfillment providers. Having outgrown two e-fulfillment providers, the owners of the e-commerce company had become all too aware of terms such as “shrinkage allowance,” which are often hidden in the fine print of fulfillment company contracts. They had also experienced firsthand the repercussions of a lackadaisical workforce, long-term contacts, hidden fees, and security issues.

The Fulfillment Checklist is divided into 2 sections. The first section delves into questions related to “Reliability”. The second section explores questions around warehouse “Security.”

Checking for Reliability

There is no question about it – you must find a fulfillment provider that can consistently deliver high quality service, meeting the ever-increasing needs of your customers. In their fulfillment provider questionnaire, reliability is addressed by asking some critical questions:

  • Do you offer an Order Accuracy Guarantee?
  • If you make an error on an order, will you pay an error penalty fee on top of correcting the mistake?
  • Do you have a “no hidden fees” policy?
  • Do you offer free account setup?
  • Do you have a Technology Team available to resolve any system or technology issues?
  • Do you have a policy on inventory shrinkage or damage?
  • If any of my inventory is lost or damaged, will you reimburse me for the cost of that inventory?
  • Do you offer an Inventory Accuracy Guarantee?
  • Do you offer an Order Processing Guarantee?
  • Do you have a backup generator so the facility and systems are always online?
  • Do you have a no long-term contract agreement?
  • Is inventory received within one business day?
  • Is Your Warehouse Operation Secure?

Checking for Security

The second section of the fulfillment provider questionnaire is devoted to the security of their warehouse operations. Critical questions are explored in this section, such as:

  • Does your facility have a 24-hour monitored security camera system?
  • Does your facility security system have multiple power source backups?
  • Do you have website security with 100% uptime?
  • Does your facility have 24-hour camera coverage of every square foot of operation?
  • Does your facility have an individualized access control system with on-site management?
  • Do you do full background checks on your employees?

These are just a sample of the many questions that you can ask your potential provider before making what could be one of the most critical decisions for your logistics operations. The fulfillment provider questionnaire is conveniently crafted in a PDF document so that you can easily download and fill out. To view and download the entire PDF, click here.

Fulfillment Companies Can Offer Specialized Services – Just Ask!

If you are currently working with and/or looking into hiring a fulfillment company, you have many options to consider, and possibly more than you may think. Perhaps you think of a fulfillment company in simple terms: they receive your goods, warehouse them, and send them out to your customers. While it is certainly true that you can rely on your fulfillment partner for those basic services, you should know that some fulfillment companies offer specialized services as well.

Going Beyond Shipping a Package

While many logistics company force you to fit into their box of processes and procedures, some fulfillment companies offer specialized services that can be tailored to meet your company’s specific needs. One of many fulfillment companies we partner with here, Flexible Fulfillment, specializes in meeting each client’s unique needs. As an example of providing specialized services for their customers, Flexible Fulfillment provides services for a high-end leather jacket company that wanted to add that “special something” to each shipment they mail out. Specifically, they wanted each customer to receive a handwritten note to let them know the care put into their product, and they wanted the overall packaging to project the overall brand of the company.

In order to fulfill this wish, Flexible Fulfillment hand-folds each shirt in a very specific manner.

foldingjacket

Furthermore, their staff places the hand written note inside before packaging and sending the jackets to the customers.

insertthankyouandjacket

Little things like this can make all the difference to your clients and to your bottom line.

Fulfillment is the Key Word

What kind of touches can you think of that you might want to add to your packages? It might be a hand-written note or it might be gift packaging. Perhaps, you have delicate materials to package in a unique and beautiful way. If you are looking for a fulfillment company that will perform similar tasks for you, and even if you are not sure yet what you want, make sure to look for one that offers additional kitting services and that offers flexibility in packaging. Many companies, especially the larger companies, simply won’t allow you to change or deviate from their standard way of processing orders. While this helps in some ways to reduce potential errors, it can be crippling to smaller and growing companies that simply have to provide a customized experience to their customers in order to grow and remain competitive.

Fulfillment and Customer Satisfaction

Whatever your business, you know customer satisfaction and retention are key. As a crucial component of customer satisfaction, how do you make the customer feel as if you care about them – that they matter to you? A solid order fulfillment strategy, including some of these small touches can make all the difference. Imagine yourself in the customer’s shoes, receiving that little handwritten note. Imagine being aware that your delivery is special and unique. This is what separates successful online retailers – they think about every single detail from the time the order is placed until it reaches the customers. A highly flexible and unique fulfillment experience is becoming increasingly more important, especially as online retailing grows at an exponential clip.

Additional Costs of Specialized Services of Fulfillment Companies?

Here is a question you may be asking yourself right now. All of that sounds great, but … how will it impact your bottom line? You might be surprised. If you are in the market for a fulfillment provider, you already know the benefits inherent in having an expert do the work for you. Your goods have to get packaged and shipped to the customer anyway and with the help of an expert distributor the goods get there securely and efficiently. The same is true of additional services. You could hypothetically do all this work yourself, but the man-hours would be too much, forcing you to allocate less time to other highly important functions of the business. An expert fulfillment company can work with you and help you to go above and beyond, with the know-how to do so efficiently and well, at lower costs with higher rewards.

Fulfillment Companies Mean Quality – and Quality Counts

Look at it this way. You want the best for your customers and that includes competitive pricing. Your overall costs include the cost of shipping goods from your manufacturing facilities to the consumer. What you want is a fulfillment company that can do this work efficiently. Fulfillment companies that do this well also know how to work within the process, to make small changes in accordance with your unique requirements. When you can find a fulfillment company like that, you know you are dealing with well-qualified experts. This kind of specialized service may not be for everyone but if you think it could work for you, you will almost definitely find that the benefits far outweigh the costs.

Do you have questions about finding the best fulfillment provider for your business? Would you like to know some of the options available to you? Contact us today and let us help you make the best match for your business.

Fulfillment for Start-ups and Small Businesses

fulfillment for start upsFulfillment companies are notorious for looking for new business customers that ship high volumes of orders. It’s no secret that a larger volume of orders produces more income for the fulfillment company, and with larger volumes there is typically less risk than taking on a start up or growing company. In fact, many fulfillment and 3PL providers will tell you that you shouldn’t even consider outsourcing your fulfillment until you get to a certain level of order volume, arguing that it doesn’t make sense from a cost perspective to outsource until you reach a minimum order volume. But is all of this really true, or are there instances when outsourcing makes sense even for a start up or small businesses? Are there companies that truly focus on start-up, smaller and growing businesses, offering a fulfillment solution that is affordable and workable for their specific needs?

Why Optimal Order Volumes are a Myth

It is certainly true that efficiencies are gained when order volume increases, but it’s absolutely untrue that smaller businesses shouldn’t outsource unless they reach a certain order volume. First, consider the situation where a small business would rather think “strategically”, focusing most of its internal efforts on growth rather than inserting product into a box and slapping a label on it. Not to minimize the importance of the logistics process as it is extremely important, but growth reigns in a business. In most cases, if you’re not growing sales, then you’re probably shrinking. Especially for smaller or start-up businesses, it could just as easily be argued that razor sharp focus on growth and marketing is absolutely critical to success and longevity of the business. Second, there are a wealth of other instances where outsourcing for a smaller or start-up oriented business make sense, such as international companies looking to expand presence into the US without opening up a physical operation, locating fulfillment closer to the manufacturer or supplier or customer base, or a wealth of other legitimate reasons.

So Start-up Friendly Fulfillment Companies Do Exist?

The good news for start-up or growing companies is that there are some great options for outsourcing fulfillment with companies that have a favorable service and terms for their type of fulfillment project. These companies have focused on building systems, processes, technology and people to be able to offer a cost effective and flexible solution. In fact, if done the right way, these companies are capable of creating a diversified portfolio of clients that aggregately ships in high volumes, creating a unique solution that, as a whole, operates in a similar fashion to a fulfillment company that has a smaller subset of larger volume clients. “The other benefit we see is that oftentimes these smaller and start-up businesses grow significantly, turning into a larger volume shipper,” said Jeremy, owner of Justified Logistics who focuses on order fulfillment services.

The Right Kind of Fulfillment Company Offers Advantages to Smaller Businesses

Ultimately, the benefit of using a fulfillment company that specializes in shipping for smaller volume customers is plentiful. First, these types of companies are typically more flexible – they’re usually smaller businesses themselves with 1-2 regional locations, with processes and procedures but not over-the-top red tape that you have to sift through. For example, larger companies may require orders to be shipped out a certain way without deviation and in its own packaging, whereas small business fulfillment companies offer more flexibility to tailor the order and packaging experience. They understand, after all, that you have to find creative ways to win deals, so they are flexible to meet these needs. Second, smaller volume friendly fulfillment companies have more favorable terms, usually without monthly minimums, since they bank on the aggregate volume of all orders and know that every penny counts for start-ups and growing firms. Third, with smaller companies, oftentimes more dynamic and personable relationships can be forged, as you’ll likely be able to interface with upper level management and won’t be so much of a “number.”

All in all, it’s important to know that you do have options as a start-up or growing business. Although there are articles out there that claim you shouldn’t start outsourcing at an early stage, this couldn’t be further from the truth in a number of cases. By focusing on a company that caters to your particular situation, you do have options to offload this important aspect to a professional organization, so that other business areas can get the attention they need to succeed as a business as a whole.

Fulfillment is More than Picking and Shipping

Print Fulfillment SolutionMarketing departments and Crowdfunders are looking for fulfillment partners who understand their marketing needs, help with their branding, and have access to creative reward options. Many fulfillment companies are equipped to handle transaction mailing but do not have printing expertise. On the other hand, companies who are experts in printing t-shirts or giveaway items lack a complete fulfillment solution. To be your complete fulfillment solution, a fulfillment organization should have expertise in the following:

  • Dedicated Graphic Design TeamGood design is an essential part of presenting your business and governs your marketing. A fulfillment house that has a dedicated graphic team can provide a constructive eye on your print elements and give input on what would print effectively. A good graphic team can make sure whether a particular font or text size will print correctly or catch simple spelling or grammar errors. These simple corrections can save an organization from costly mistakes. A dedicated graphic team can check the artwork and also if the artwork is setup on the correct template. Also, a proper archival system ensures that the files are available for future print runs if needed and future re-runs should look same as the first run.
  • Onsite T-shirt ProductionCustom printed t-shirts are not only an important giveaway but also used by organizations to raise additional revenue. A custom printed shirt offered for sale for charity or an artist selling shirts to his/her fan base must be produced cost effectively. Most custom t-shirt print houses fulfill T-shirts on demand which is expensive and does not help organization raise money effectively. A good fulfillment house should have ability to produce custom printed shirts onsite so the shirts can be printed with lower cost and quicker turnaround.
  • Promotional Printing A good fulfillment must have a good print department. Catalogs, brochures, info and sample packs, branded premiums, and coupons are common examples of printed items used to promote a product or company. A promotional fulfillment program could be a one-time event or an ongoing campaign. Promotional fulfillment could be targeted at new prospects and/or existing customers. Other popular items distributed through print fulfillment programs include educational materials, repair and training manuals, sheet music, calendars…basically any printed item that is offered to consumers can be part of a print fulfillment program. A fulfillment department with print capability to help support these marketing initiatives.
  • Consultative ApproachA fulfillment partner is an extension of you business and should be readily available to take a phone calls or answer email. There are an overwhelming amount of options that you do not have time to go through yourself. You should be able to rely on their expertise in recommending solutions and products and trust them to cut through and let you choose from a handful of the best options.

It is huge value add when you have a partner who has made the investments and connections to smoothly handle your needs for now and in the future. The right fulfillment partner can do more than just pick and ship.

Selecting a Canadian Warehouse Location

CanadaWhere to start?

It makes sense to start by analyzing your supply chain and to discover where most of your product is flowing to. The key to a successful and efficient supply chain is to consider the following questions:

  • Where is your port of entry?
  • Where are your customers mainly located?
  • Does your volume qualify you to have multiple locations?

Throughout this article, I will be referring to a consumer goods company shipping 40’ containers from Shenzhen (China) to Vancouver (Canada).

Analysis of the Canadian Consumer

The location of Canadian customers falls roughly in line with a provincial population map. With that in mind, it is generally safe to assume that 38.4% of Canadians are in Ontario, 23.6% in Quebec, 13.1% in British Columbia, 10.9% in Alberta, 3.6% in Manitoba, and 3.1% in Saskatchewan. These provinces make up almost 93% of the Canadian population. All other provinces are under 3% or less.

The interesting thing about the map below is that it does not give you an idea of where people live within the provinces. 90% of all Canadians live within 100km (62 miles) of the US border. So the map below may look daunting, but the vast majority of Canadians are actually very close by.

CanadaWarehousing

The greyed out area makes up 0.8% of the Canadian population – not including polar bears.

Considering the above information, we can see that the 4 most likely locations to consider in terms of sheer population size are Ontario, Quebec, British Columbia, and Alberta.

The two key distribution hubs are Ontario and British Columbia as most consumer products come through Vancouver’s port, and the majority of perishable and automotive shipments pass through Ontario by road or rail. Ontario and Quebec make up 62% of Canada’s population, and this number is growing every year. Most major companies distribute their products from either Ontario or Quebec because the largest cost is the end delivery either to distribution centre, store, or the customer’s home address. If 62% of your customers are in one area, it makes sense to warehouse your product in close proximity. Furthermore, 53% of Ontarians live in the Greater Toronto Area, or within 1 hour’s drive of Toronto.

Reducing Shipping Costs & Delivery Times

If product arrival is not time sensitive, it may be an option to utilize rail as a means to move product from Vancouver to Ontario or Quebec. Shipping by rail can save companies as much as 33% on shipping costs. However, if getting your product to your warehouse is a priority it makes sense to utilize air freight, or a reliable large carrier such as Challenger Motor Freight. Full truckload shipments from Vancouver to Toronto generally take 4-5 days of driving (weather dependent) for a single driver, and that time can be cut in half by team drivers.

Here’s an example to show why it often makes sense to warehouse your product in Ontario:

This is not to say never to warehouse product in Vancouver. If a customer has enough order volume in British Columbia or Alberta, it may make sense to warehouse some product there rather than sending it all the way to Ontario, only to ship it back out to West. That would be expensive and wasteful.

Reducing Shipping Costs & Delivery Times

If you’re shipping from China to Vancouver and have customers all across Canada, my recommendation is to warehouse some product in Vancouver area, and to move the rest to the Greater Toronto Area. This is a broad and general statement, but at the end of the day it usually holds true. The key is to look at where your shipments are entering Canada, and to analyse your order destinations within Canada. Keeping the distance and time short on the final delivery is very important.

Article by Ryan Bennett of Challenger Motor Freight

As E-Commerce Grows, A New Breed of Fulfillment Companies Offer Online Retailers Value Beyond Shipping

Online Shopping and FulfillmentIn years past, fulfillment companies simply served as an outsourced shipping department, storing goods for companies and shipping orders to their customers. While the breadth of services have steadily increased over time in order to meet the rigorous demands of multi-channel fulfillment, including retail and e-commerce fulfillment environments, fulfillment has largely been…fulfillment. That is, until a new breed of fulfillment companies have cropped up that offer services outside of the scope of packing and shipping.

How Innovation in Fulfillment Got Started

Perhaps it all started with some of the major online marketplaces, such as Amazon and eBay, offering fulfillment for companies selling on their respective marketplaces. For smaller and more regional logistics companies looking to compete with services like Fulfillment by Amazon, new and creative ideas had to be fostered to level the competitive playing field. After all, it seemed to make sense for a large number of sellers to not only list their products on a website but also have that same company fulfill orders. If traditional fulfillment companies didn’t want to become a dinosaur, they had to come up with a way to win back sellers.

Further complicating the competitive landscape was the introduction of additional sales channels online – from social media to crowdfunding platforms and beyond. Online merchants, with each passing day, had more and more sales channels online at their disposal – which was particularly intriguing for smaller and start-up businesses because they were finally afforded the opportunity to compete with bigger retailers and businesses. In fact, with the world at their fingertips, online merchants were only limited by the time and investment required to participate in these sales meccas.

Opportunity and Timing Collided for Forward Thinking Fulfillment Firms

Naturally, the first wave of fulfillment innovators chose the path of becoming a niche expert for fulfillment services in these specific online marketplaces. For example, some firms chose to focus specifically on fulfilling order for crowdfunding campaigns, or became e-commerce fulfillment experts – building sophisticated integrations with web store software programs so that they could receive online order, offer real-time reporting, and even in some cases offering support for inbound calls and order taking.

But a new breed has evolved to take things to the next level of service, offering even more than fulfillment itself for businesses that either don’t have the time or resources to take advantage of every opportunity. For Utah Based IFS (International Fulfillment Solutions), the move from straight fulfillment to value added services was obvious. According to Ryan Treft, President at IFS, the company saw a need to assist companies with selling in various online marketplaces. “We have essentially created a distribution arm of our company which allows us to offer the channels as additional sources of revenue for our clients. Half the battle in selling a product into retail has nothing to do with the product itself…it has to do with convincing the buyer to set you up as a vendor. That’s where we come in. We are the vendor of record with 21 major ecommerce retailers. We ask our fulfillment clients if they want us to manage sales of their product into any of these channels. Once they pick the ones relevant to their brand, we submit and we can add much easier than they can. We confirm the order, we provide the tracking, we buy product from our own clients to manage the channels they have chosen. “

This unique add-on service does a couple of things for companies like IFS. First, it adds tremendous value for fulfillment customers. According to Danny Villarreal of Zarbee’s (who utilizes IFS for value added services), “We have been able to fully offload our online orders and samples fulfillment and have confidence that our customers will be taken care of.  The great part is that we can now focus on driving our marketing and business and know our fulfillment is in a solid place.”

But adding value isn’t the only benefit. In addition, these services make the entire process faster, bringing sales and profits to growing companies sooner than later. For another IFS customer, ATGStores.com, the add-on service was an easy decision. Because the process to add new brands is quite extensive, having a relationship with a current vendor already intact makes the process easy and to get things done fast. They were able to get from point A to point B much quicker than on their own.

Innovation Will Continue to Shape the Fulfillment Industry

Outside of the benefits to customers, value added, online sales oriented services does another very crucial thing – it allows these creative fulfillment companies to compete with much larger fulfillment marketplace competitors and fulfillment companies in general. As is true in business, healthy competition and changes in the marketplace spur innovation and growth. It will no doubt be interesting to see what will come about as a result in this most recent shift in fulfillment services. As online selling and logistics continue to collide, companies will continue to find new ways to add additional value and further differentiate from their competitors, which will help propel online sellers to a new level of potential success and continue to disrupt the logistics industry.

The Benefits of Warehousing for Business

When it comes to logistics, small business owners know that warehousing is important. It in itself is part of managing the supply chain, and although simply seen as a place to store goods and prepare items for outbound shipping, warehousing and pack&ship orders, they are economically beneficial to both owners and customers.

Why is warehousing necessary for even small businesses?

First, it provides a central location for your products. Having a place to receive orders, store goods, and distribute products make the process systematic. With each arrival of shipment, responsibility goes to the warehouse personnel, and they’re going to be in charge with identifying, sorting, and dispatching the products to their storage locations, looking over security measures and environmental hygiene. Then orders come and go, and warehouse personnel keep up with the records before dispatching. Warehouses ensure that there is a place to store goods when there is not quite enough demand for the supply. Instead of leaving the surplus products somewhere, having a warehouse ensures that the there is a good place for storage somewhere to keep goods until they are needed or wanted again without having to haul everything by your lonesome self.

Second, it adds value to your operation. The good thing about warehousing is that you are more in control of your shipping and handling. Because warehousing increases the value of goods by providing services that make products available at the most convenient way possible, it lowers the costs and increases the value of customer service. Warehousing operations such as consolidation and assembly add value to the logistics of the business.

Third, the efficiency, capacity, and location of warehouses provide economic benefits. Consolidating operations, for instance, cut costs for outbound delivery, which works well for both business owners and their customers. Instead of shipping individual products from a plethora of sources, central warehouses help package and ship orders together as a complete order, effectively eliminating expensive shipping costs. This is beneficial for making a turn in profit for businesses, especially new ones. Besides, most warehouses provide processing, packing, and blending, and grading facilities, meaning, small business owners can save more by not having to pay third parties in the order fulfilment process.

Fourth, warehousing is also an effective contingency plan to make sure that orders are sorted and done on time. Warehousing service companies like National Products Fulfilment http://www.npfulfilment.com.au/ ensure that their clients get their orders safely and on time. Warehouses provide custody of goods, and as an added benefit, products kept in warehouses are almost always insured. With systematic efficiency,  good warehouses guarantee a 99.9% accuracy level of storage and inventory, allowing you to sit back and relax while other people to do the job for you.

Finally, warehousing allows you to focus on the more important part of your business: making it in the dog-eats-dog world without having to worry about too many things. Which is why warehouse and inventory management is important for small-and-medium sized businesses planning to make it in the great big world.

Of course, there are different types of warehouses for different types of businesses, but warehouses — whether private or public or bonded, are guaranteed to help lessen the gap between production and consumption, that is what you call a proper order fulfilment process.