What to Consider When Choosing an Order Fulfillment Service
Order fulfillment services, (a.k.a third-party fulfillment) are prevalent throughout the GTA. This is hardly surprising given that Toronto is home to many small businesses in need of fulfillment services. With such a selection of fulfillment partners to choose from, however, it can be tricky to narrow down the candidate that could work best for you. Here are some ideas of what to keep in mind when deciding.
Understand the Fulfillment Centres Cost Structure
Different warehousing and fulfillment services will have varied cost structures, and each one is generally styled towards a different type of business. Some arrangements might have larger storage fees but small or no pick-and-pack fees, which can work well if you have a small number of products but a large amount of variance in how they are ordered. On the flip side, low storage fees with the addition of pick-and-pack fees might be the better option if you need a lot of storage but products don’t require much manual work when ordered. Be aware of how costs are distributed and what kinds of value-added services can be obtained in order to make the most of your investment.
Look for Distribution Centres with Centralized Location
The location of a distribution centre is integral for e-commerce fulfillment companies since it directly affects how quickly products can be delivered to customers. In addition to being a key part of customer satisfaction, delivery speed also affects the type of shipping options you can offer. The ever-popular next-day deliver option, for instance, is reliant on your distribution centre having the geographic position needed to get products moving quickly. Additionally, customers tend to expect free or lower shipping costs if a delivery takes a week or more to arrive, which can further eat into potential profit.
How Is Order Shipping Handled?
The exact process a third-party fulfillment service uses when shipping products is also worth paying attention to. Location matters a great deal in determining delivery speed, but it is not the only factor. How and when shipments are picked up, routes used, plans for unexpected developments, and more should all be evaluated to see if the practices meet your needs and expectations.
Compare Service Level Agreements
A service level agreement (SLA) is a guarantee of how the order fulfillment service will handle orders, ship goods, and otherwise carry out its role in your business arrangement. SLAs should ideally report on elements like order accuracy, inventory shrinkage, the percentage of orders that get shipped same-day, and other key bits of data you deem appropriate. The SLA reports should also be provided regularly since they are integral to keeping your partner accountable.
Look to Lean Supply Solutions for a Fulfillment Services Partner
Lean Supply Solutions is a third-party logistics fulfillment company in Toronto whose operations are based around the Lean Methodology, a proven philosophy focused on eliminating any operations, equipment, or resources that are not capable of adding value to clients’ supply chains. By striving to ensure that the right products are provided to the right customers at the right time, Lean Supply Solutions is able to offer consistent, predictable, and quality results. To learn more about the Lean Methodology, outsourcing to Lean Supply Solutions, or to ask any questions, give us a call at 905-482-2590.