Ask experts like Entrepreneur Magazine, and you might think that fulfillment services do nothing more than handle “the process of receiving, packaging and shipping orders for goods”. Yet, fulfillment services are much broader than that. In this article, we are going to look at the ways that modern fulfillment services have branched out, and in some instances, how they transitioned entirely from another form of business into a fulfillment service.
We are also going to consider the creative ways that some fulfillment services have met the challenges of being a low margin, high volume service with a lot of seasonality. This is quite important. After all, a low margin business means one in which the product or service sells for close to the price it costs to produce. They are typically required to be high volume to generate good profits, yet many fulfillment services experience a constant flux of seasonal business.
Because “necessity is the mother of invention”, many fulfillment services find ways to create more stability.
This is not to say that fulfillment services are not a good business to enter. In fact, many firms don’t even set out to work as fulfillment service providers. Instead, they begin by simply making and/or selling their products. They enjoy a bloom of success and realize that they cannot find a company to handle their needs. This is also a moment when necessity fosters growth and such businesses then turn their attention to fulfillment in addition to sales and/or production.
Investing in Fulfillment
Firms that invest in the technologies, space and staffing essential to quality fulfillment may also branch out and become a third-party fulfillment provider for other firms. Filling a need they also experienced could be a fantastic way to grow a business. For instance, a company that manufactures or sells products and handles its own fulfillment may also offer “third party” fulfillment that integrates with its own. This can offset the risks of fully dedicated fulfillment services with their seasonal ups and downs.
Keep in mind that working in fulfillment can also illuminate some niche markets or needs not being met by other providers. For example, one fulfillment company in our network in Texas, Warehouse Pro, began as a soap making firm. They also warehoused their own goods, storing as well as handling all of their soap shipments to customers. This same firm then invested in third party fulfillment because they had ample warehouse space available and had mastered the technologies used in the industry.
This same firm also expanded their offerings into manufacturing and fabricating, including some welding and fabricating and even making custom sails for boats and other vessels. They have also provided specialized services for credit card companies!
What we want to emphasize here is that fulfillment companies have much more than basic services for a website retailer. They are one of the most creative groups, finding many ways to monetize and leverage their capabilities. Should you require such things as large scale storage, customized services or even bulk shipping, they may be your ideal solution.
The Services You Might Find
Without putting on our “creative thinking caps” and getting too crazy with ideas about services that fulfillment providers might offer, let’s just do a basic run down of what you might find with one:
- Warehouse and Distribution services – They may handle your storage and do your customized shipping for your firm. Usually, it means an entirely customized approach that includes your specialty packaging, the inclusion of additional materials, and more. Typically, you can request them to handle things in very specific ways and even offer shipping in a large number of channels.
- Custom Packaging – Their relationships with packaging suppliers often means they can provide clients with a lot of support in finding customized packaging solutions for almost any sort of good or product.
- Climate Controlled Warehousing – Not all items can exist happily in the sweltering heat, high humidity or freezing cold of a standard warehouse. A fulfillment provider often has a warehouse that remains comfortable and optimal for any number of product categories or types. You may not even use them as a shipping service but merely as your ideal storage space.
- Inventory Storage – There are so many instances of a project or group requiring large quantities of inventory. They get the best rates if it is purchased at once and in bulk. Then, the problem with where to keep it as the project or business proceeds, arises. This is when creative fulfillment services can step in and offer a good solution that allows them to monetize unused warehouse space.
- Logistics and Transportation – As groups with tremendous experience in the use of major shippers, a fulfillment service is one of the best candidates for help with the transportation and logistics relating to any number of businesses or items.
- Manual Integration – Anyone making a move from traditional inventory management and warehousing to online sales has a lot of data to enter. A lot of fulfillment services have begun to offer this precise service. Helping you to inventory your existing materials, make sure you have SKUs for every possible item, combination or kit, and then integrating this information across your online sales platform and the warehouse or fulfillment service’s system.
- Manufacturing – It is amazing to look at the ways that fulfillment services also integrate smaller scale manufacturing into their options. They may make displays, packaging, and so much more.
Fulfillment services are a must for those with online business eager to hand over the management of order processing, shipping and returns. They can save tremendous amounts of money, and offer a diversity of effective solutions. Don’t overlook them when you need everything from climate controlled, bulk storage to setting up an online business and shipping large amounts of goods. As a business full of fluctuations, they adapt well and have a lot of answers for many kinds of businesses.