Order fulfillment is the critical factor of any eCommerce business. It is important to choose the right order fulfillment model in order to ensure that orders manage to roll in and deliveries are made on time.
There are numerous order fulfillment models to choose from for your business, each has its own unique value. You should choose based on factors like products, order volume, and such. Below are the 3 most common methods, let’s take a look and decide which one is best for your business.
In-house order fulfillment
Also known as self-fulfillment, the in-house order fulfillment model happens when retailers completed every step of the process internally, without the help of a drop shipper or 3PL provider.
This method is common for retailers that are new to the business, who start to manage inventory and pack orders right in their home.
Advantages of in-house order fulfillment:
- You have 100% control of inventory, pick, pack, and ship process
- Low shipping cost since you do all the work
Disadvantages of in-house order fulfillment:
- Time-consuming - it typically takes up lots of time that could be used to acquire customers, develop products, and launch marketing strategies.
Third-party order fulfillment
Retailers usually use this method when they run out of inventory storage space and don’t want to waste time packing and shipping orders. By relying on 3PL to take over, you would have more time to promote your brand. 3PL would complete all the work for you, including receive inventory, picking, packing, shipping orders, deal with return items.
Some of the top 3PL order fulfillment services with long-standing reputations are ShipBob, Red Stag, and DHL. Each 3PL is different and has their own unique services that would vary depending on your requirements, such as custom packaging, temperature control, and more.
Advantages of 3PL order fulfillment:
- Cost-saving since no need to invest in the warehouse or staff to pick and pack orders.
- 3PL can deal better discounts with UPS/FedEx
Disadvantages of 3PL order fulfillment:
- They are the one who controls the quality of orders, so if they mess up, you would be the one to hear complaints from customers
Dropshipping order fulfillment
The method means that the manufacturer would produce, stored, and shipped the inventory. When customers place orders online, the orders would be forwarded to the manufacturer. Then, the manufacturer would ship products directly to customers. If you use this method, chances are your customers might have to wait for their orders to be shipped from across the world.
Furthermore, you wouldn’t have full control over inventory and order fulfillment.
Advantages of dropshipping:
- Dropshipping is convenient since it provides products and shipping services, so you can focus on other important tasks.
- You only have to pay for inventory, therefore you could avoid expenses like warehousing, which makes this affordable
Disadvantages of dropshipping:
- No support for custom products
- No control over the process - if there is a miscommunication or products mishap from your customers, they wouldn’t want to hear that it was out of your control
Order fulfillment in POS system
There are two options when you fulfill an order - manually or automatically. During the payment process, the ‘Auto fulfillment’ button would appear; and if you click on it, the order would be considered ‘Fulfilled’, if not then you would have to go back to mark it as fulfilled later.
Fast and affordable shipping options are what customers look for when shopping online. Without the proper order fulfillment process, your business wouldn’t be able to deliver, ultimately losing the brand’s reputation and customers. To find more articles about technology like this one, visit ConnectPOS and check out our blogs.