Understanding Your Fulfillment Service policies

Fulfillment Service and Understanding Your Center’s Policies – Know What You’re Getting

If you are an eCommerce retailer selling products online eventually you will need to address the cost of your fulfillment service operation and whether it is economical to provide this service in-house or begin the pursuit for a 3rd party fulfillment service provider.  3rd party order fulfillment service centers provide scalable facility environments with demand based labor.  The cost for an outsourced solution should parallel the success of your organization and provide the flexibility and resources required for quick growth or a sales drawback.  Highlighted below are 7 pieces of the fulfillment service puzzle that you need to better understand to help determine which  3^rd party fulfillment service solution is the best fit for your company.

Since your order details have been processed the physical activity of selecting the items for an order and the packaging of the components begins.  The pick and pack process should focus on order accuracy, package integrity and turnaround time.

All fulfillment service houses are not equal. If you’re contemplating outsourcing your fulfillment service, you should familiarize yourself with a firm’s policies and procedures, and carefully read the terms in the agreement they provide, before making any decisions.

Quick Question Checklist for your fulfillment service

Before you begin your search, make sure you have a clear understanding of what your provider requirements are. What functions are you looking to outsource – just the warehousing and inventory control? Or do you want your firm to be the frontline for customer service, as well? Knowing exactly what you need will make it easier to recognize the right firm for the job. The following are some of those key issues you need to cover with each house:

FULFILLMENT SERVICE RETURN POLICIES

Ask how your potential firm handles returns, what their policies are for accepting them, and what your role is in the process. If your customers ever need to return an item, you want to know that they’ll have a pleasant experience doing so.

Degree of visibility

Find out what tools the firm will provide to effectively manage your inventory. From giving you access to real-time info on your stock levels to sending reorder alerts when your SKUs reach a certain level, you’re looking for a firm that offers a high degree of visibility.

Order AccuracyPicking errors are damaging to your reputation with your customers as well as detrimental to your bottom line.  Nothing frustrates a consumer more than finally receiving their order only to have it contain the wrong item or an incorrect quantity.  Mis-shipments will result in return charges and a subsequent redelivery charge assuming the customer doesn’t cancel the order.  Your fulfillment provider should hold themselves liable for the direct cost associated with retrieving and fulfilling a return and replacement order.  That being said the end customer is still frustrated even though the direct costs of replacement are incurred by the fulfillment service center.  Best practice is for your fulfillment center to have a published flow process with defined Quality Checks (QC) that mitigates such issues.  The pick and pack process should be broken into two separate events and managed by two separate teams.  Pickers are assigned to item selection for a given order and purposefully navigate the aisles until the collection is complete.  The order is then entered into a packing queue where the packers reconcile the order selection and verify order accuracy against the order invoice/packing list.  Once the order selection is verified, the packers accumulate the contents of the orders into suitable shipping container and the package is sealed for shipping.

Sales channel integration

You need to know that your fulfillment service house is able to seamlessly integrate with the sales platform or platforms that you sell on.

Restrictions

Not every fulfillment service firm accepts every type of product. Most aren’t equipped to store hazardous materials or perishable goods, and many don’t handle large, bulky items. If your products have special requirements, you want to make sure that won’t pose a problem.

Areas of specialization.

Many houses specialize in fulfillment service of specific types of goods, like media products, or products requiring installation, special storage or lot tracking. Even general fulfillment houses tend to have a sweet spot or “niche” in which they excel, such as items that call for preparation or kitting. You want to find a house that’s well-equipped to handle your particular inventory.

Package IntegrityYour outsourced fulfillment service vendor is a forward extension of your company and the packages being shipped to your customers needs to be representative of how you as a company do business.   The presentation value and structural integrity components need to be balanced to ensure your orders arrive intact and appear professionally packed.   Your fulfillment service provider should discuss your product mix with you to determine the appropriate void fill (foam peanuts, paper, sealed air, etc.) required for each of your packaged items and also give you guidance on a suitable shipper that conforms to ISTA standards so your shipment survives the expected hazards.

Data transfer methods.

When it comes to getting your orders to your fulfillment service provider, there is a huge spectrum of options. Look for a fulfillment service house that can receive your information using the method that works best for you. For instance, if your order system is capable of outputting in XML markup language, you may want to find a firm with a compatible system, so your respective order systems can directly share your order data.  Many fulfillment service houses have web sites where you can find a copy of their standard client agreements. Study a company’s agreement template before you contact them, to avoid wasting their time – and yours. nce you’ve read their terms carefully, make a list of any questions you still have, so you don’t forget to ask anything important once you reach them.

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