The Top 5 Mistakes to Avoid When Choosing a Fulfillment Partner
Let’s face it, deciding what to do about your company’s fulfillment can be a very difficult task. And many small business owners don’t know a whole lot about fulfillment to begin with. Over our 7 year history, we’ve seen thousands of small businesses struggle with the entire decision making process…from whether or not to outsource to which outsourced company to choose. Unfortunately, far too often we’ve seen small businesses make decisions based upon fiction instead of fact.
Famous Last Words #5: “Fulfillment is easy – anyone can do good.”
We certainly agree, at first glance, fulfillment seems really easy. However, there are so many variables at play, from ensuring proper items have been picked and packaged to selecting the correct shipping service level to integrating with various shopping carts, among many, many others. Fulfillment can be quite complicated, and it’s easy to make mistakes. There are quite a few companies that don’t perform at the highest of levels, so be on the lookout for indicators of success. Do they measure their success rates? How often do they have an inaccurate shipment?
Words of Wisdom: “Not all fulfillment companies are created equal.”
Famous Last Words #4: “Their website said they’re good, so they must be.”
Checking out fulfillment company’s websites can be a great starting place for finding out crucial information that can help you make a great decision. But you can’t believe everything that you read! Your job is to delve deeper – finding out from customers what their experiences have been working with them. Check to see if they have a Better Business Bureau report, talk to their customers, and make sure that they’re willing to memorialize their promises into their contract with you. Oh, and be very careful of websites that claim to rank fulfillment companies. We found that most of these companies aren’t doing what they say – rather, they’re giving the top rankings to the companies that offer the most money for that position…not the company that has the least complaints or does the best job!
Words of Wisdom: “Don’t take what anyone says as gospel truth…dive deeper yourself to find out the full truth.”
Famous Last Words #3: “I can’t afford fulfillment.”
So many companies make the mistake of not outsourcing because they believe that they can’t afford the costs of outsourcing with a fulfillment company. Small business owners look at the storage costs and the order fulfillment fees and decide to keep doing it themselves…despite the fact that it means they’ll be either doing the shipping themselves or spending a great deal of time overseeing the process. They simply don’t appropriately understand the “time value of money.” Simply put, you always have to value how well your time is spent. In this case, are you better off slapping shipping labels on packages, or out there closing deals and marketing for your company so that you can grow? You may be losing a great deal of money by spending your time on tasks that are easily outsourced instead of revenue generating tasks for your business.
Words of Wisdom: “Instead of thinking ‘I can’t afford fulfillment,’ you might be better off thinking ‘I can’t afford not to outsource my fulfillment.”
Famous Last Words #2: “Choosing a company that is close by is the best option.”
When it comes to finding a fulfillment company, we may think that we need one that is right next door to us – even though there may not be great fulfillment options in our area. Or even worse, we may insist on a location close to us despite the fact that our location may not be the most ideal distribution point based upon where our suppliers and customers live. Don’t let yourself be the reason for making a bad business decision. Be open-minded about different options. The best fit for a fulfillment company may be slightly further away than you thought, but that extra distance could mean monetary savings and better sleep at night.
Words of Wisdom: “Location, location, location is as important in fulfillment as it is in real estate, so be open to areas outside of your headquarters.”
Famous Last Words #1: “By choosing the company with the cheapest rates, I’ll save money.”
This is easily the biggest reason for failure that we’ve seen over the years. Companies choose a fulfillment company that is “cheapest”, thinking that the short term profits will lead to the best overall results. And as many times as we’ve seen this, we’ve seen companies pay severely, because oftentimes the company with the lowest pricing has the least amount of technology, lowest controls and metrics, and least amount of customer service. Believe me, the last thing you want to do is have your orders go out wrong or shipped inaccurately. We’re not saying that this is always the case, but usually you get what you pay for. A reasonably priced fulfillment company that can offer better service and fewer errors may very well be worth the additional cost. could mean monetary savings and better sleep at night.
Words of Wisdom: “You get what you pay for.”
Deciding what your company will do about fulfillment is vital to the success of your company. Keeping the above 5 factors in mind will start you on the path to making a great decision. Make sure you don’t find yourself saying any of these famous last words so that your company can become the successful business that you hope and dream for.