Fulfillment is one of the most important aspects of an e-commerce business. After all, the fulfillment house is responsible for actually packing and shipping products to the end customer. As the last hands to touch your orders, they can make or break customer satisfaction.
When you chose your current fulfillment partner, it probably wasn't an easy decision. They would be receiving, inspecting, storing, and handling your products and customer data, so the choice to put your trust and logistics into someone else hands was not made lightly. Still, sometimes the right fit takes a few tries.
Once you've been working with a fulfillment house for a while, it's a good idea to review their performance and see whether there are areas for improvement. Fine-tuning your fulfillment process can save money and improve customer satisfaction, as well as relieve any stress you may have about the relationship. Start by asking yourself these key questions. There is always room to improve.
>Where are the low spots? If there is one issue that keep popping up, it's time to take a closer look. Errors can happen anywhere, but when a trend develops, that's a glaring opportunity. Make sure to consider customer service representatives input, as well as inventory processing and other operational concerns. You may find that there are even aspects outside of fulfillment that are affecting its performance. For example, when suppliers don't properly label shipping cartons, the fulfillment house may need extra time and charge extra money for receiving. You can address this with your suppliers, thereby helping improve your overall chain experience.
>Review pricing and check your average per-order fulfillment costs. If the costs are cutting into margins, there is another area to inspect.
>How is the accuracy of shipments? Do you often have misshipped items or orders that go missing? Keep a list of the issues. If there are more than one or two errors in shipping per month, the accuracy of service needs to be addresses to maintain satisfaction and minimize costs.
>Multichannel Merchant explains 11 key indicators to check whether your 3PL is performing up to the level expected.
Time to Work it Out
After you identify areas for improvement, discuss your evaluation with your logistics provider. Establishing goals and being clear about your expectations is important to this process. Make sure to delineate the areas that need change and come to an agreement about the time period for improvement. You could setup monthly discussions to review the performance, with an overall period of several months to see results.
If the fulfillment house is not willing to work with you on the improvements, then it may be time to look elsewhere. Your satisfaction is paramount and will trickle down to your customers. Attitude isn't everything, but certainly a willingness to talk these things through and make reasonable adjustments is necessary for the relationship to flourish.
Revisiting and Reevaluating
Follow through on reevaluations at the agreed times. Keep your eye on the goals and make sure that your concerns are being addressed. The response of the provider will tell you a lot about the long term potential of a solid partnership.
After the agreed upon time period, consider whether the changes have been made to your satisfaction. Of course, if everything is now resolved, you can move forward with confidence, but remember to evaluate performance on a regular basis. After your peak season year, get in the habit of reviewing fulfillment as well as sales. You can often find room to tweak and improve logistics, making your foundation stronger each time.
How do you feel about the relationship? If you have a sense of dread or think that you need to micro-manage the situation in order for it to succeed, then you already know you need a switch. On the other hand, if the fulfillment center is making a serious effort to improve, you may decide to extend the probationary period. Many excellent partnerships survive the fire and go on to become successful.
Is it time for a change?
“In a chronically leaking boat, energy devoted to changing vessels is more productive than energy devoted to patching leaks.”
– Warren Buffett
Not everyone is a match. Fulfillment houses are often tailored to specific industries and many develop a focus on one category or process that works best for them. If your business is within their core competency and things are going pretty well then you've probably found your match. But if you are outside of the norm for your partner, it may be time to find out whether another 3PL would work better for you.
If accuracy is a continuing problem, or delays are common, then you deserve better. In today's market, there are many warehouses that maintain high accuracy and speed. There is no need to sacrifice these aspects and they are key to customer satisfaction.
Flexibility is a service. Some fulfillment centers are better suited to using barcodes and RFID tags, and often the same centers also require tickets and full automation. This works well for high volume, low maintenance items. But some products require a higher level of handling or customization. Some businesses have VIP customers that don't fit the mold. These clients benefit from a more flexible fulfillment partner with live customer service.
Sometimes it just doesn't work out. If you have tried to resolve issues or improve the process with your logistics partner without success, it is time to look elsewhere. This does not have to be an agonizing process. Good planning offers good protection, so read our tips for considering an e-commerce fulfillment transition to make sure your switch goes smoothly.
For more reasons to change providers, check out Multichannel Merchant. And keep in mind, Sprocket Express was chosen as one of their Top 3PL's again this year.
If you are ready to explore your options, ask us for a quote today. There is no obligation and you can receive $100 off your first month, just ask!