Overview of Outsourcing Fulfillment Providers

Fulfillment companies offer a cost effective solution for warehousing and moving the inventory of businesses. Fulfillment providers are specialists in handling the labor-intensive aspects of business – working with customers, selecting and shipping products, overseeing supply chain management and even managing one-off marketing campaigns.

Client companies pass on order details to fulfillment companies. These specialized distributors ensure the right product is sent to the customer in minimum time through efficient shipping channels. As fulfillment companies store inventories of multiple clients, they can offer bulk discounts as the overheads get distributed.

Types of fulfillment providers

There are many types of fulfillment companies in the market. Depending on the business needs, companies can partner with the best provider that fulfills their requirements. Fulfillment companies are categorized as follows:

Marketing fulfillment firms

They work with businesses that have launched large scale promotions to sell goods. Businesses get the advantage of bulk mail discounts along with custom printing to tailor mail pieces to specific customer profiles.

Inventory management providers

These handle inventory warehousing and distribution for businesses, especially those that offer both retail and wholesale sales. These warehouses are typically located near commercial centers to facilitate faster shipping.

Automated order processing providers

These companies offer storage and shipping of direct-to-consumer products without the involvement of a business. The providers usually cater to e-commerce websites and call centers that demand immediate picking, packing and shipping of orders to customers.

Drop-shipping providers

Drop-shipping specialists accept orders for products that are not manufactured by the client business. This facility enables businesses to offer complimentary products and accessories to their customers without adding more vendors to their supply chain.

Return and exchange processing providers

Businesses hire these specialists to outsource labor-intensive customer service functions such as inspection of returned goods, sending replacements and handling customer credits.

Desirable qualities in fulfillment providers

There are countless fulfillment providers in the market. Companies should examine the services of providers in the following areas to select the best fulfillment partner for their business:

* Customer service: Businesses should get feedback on the quality of fulfillment services from previous clients of the provider. Customers hold businesses responsible for poorly packed, broken or incorrectly labeled shipments, not the fulfillment provider.

* Financial fitness: Fulfillment providers should be able to furnish financial statements to convince customers of their financial soundness. Bankruptcy of providers can lead to seizure of client business’ inventory.

* Testimonials: Businesses should ask providers about previous and current clients and get references from them. Many fulfillment companies publish client testimonials on their websites.

* Compatibility with third party logistics tools: Fulfillment providers should use systems that integrate with popular third party logistics software. This convenience tips the scales in favor of the fulfillment provider that can integrate with the business’ logistics software with minimum effort.

How much do fulfillment providers cost?

The charges of fulfillment services vary with the type of service. Providers may charge a flat fee per shipment, a fixed fee per order, or a cut of the customer sales.