Dealing with this while remaining competitive can be a tough balancing act.
So what do you need to think about when deciding if you should outsource your warehouse and fulfilment?
Running a warehouse is expensive. Staff, property, rates, IT, forklifts, security, health and safety, insurances, racking… the list goes on. Warehouse outsourcing not only removes the daily grind of the above, but can also greatly reduce your overheads as typically you only pay for what you use.
This is where using a specialist fulfilment and warehouse company really makes sense. Finding a cheap and suitable courier for all your different size and shaped goods of varying weight can be time consuming, expensive, and you could end up spending more than you need to if you don’t do enough shopping around. But due to the vast amount of packages a fulfilment company may send each day, they benefit from bulk discounts and often pass this saving on to you.
The warehouse is a necessary evil for pretty much all retailers and ecommerce businesses. Rapid growth and an increase in overheads is a side effect for any successful company. But with outsourcing, this is something you can take control of quickly. To put it simply, you pay for what you use. No rents to quibble, no staff to source just add/remove stock. As your footprint grows, so does your business.
What if you could concentrate on making money, instead of spending it? Outsourcing your warehouse fulfillment allows you to focus on growing your business, and doing the things you’re most passionate about. While you are reaching out to your customers, upping your marketing activity, or developing your new product range, your orders are being picked, packed and shipped without you lifting a finger. The entire process is automated from the moment the customer purchases your product. All whilst keeping your costs low, and customers satisfied.
Nobody likes processing returns, especially when you have other important things to be doing. Unboxing items, checking, re-boxing, restocking, is very time-consuming and doesn’t help you drive your business forward. Most outsourced fulfilment companies will have a dedicated team to deal with this on your behalf. Be sure you cover this cost at the start of your partnership.
If you’re one of the many retailers that imports their goods from overseas, be sure to ask the potential warehouse outsourcing company if they can deal with this on your behalf. Fulfilment companies like us should be able to deal with anything past the point of sale: paperwork, import tax, scheduling and collecting once landed. Again, this can save you a headache and free up your time to focus on other matters.
Staying in control
It is important to maintain access to everything that is happening with your stock at any time. Not only will a 3PL system allow you to stay in control, it may give you more information than you currently have. 3PL systems like Vdepot can give you different types of reports, like your quickest and slowest moving items, prompts to re-order stock, and other insights that make it easier to manage your inventory.
Online stock/reporting systems are key to keeping your finger on the pulse of your business, and put you in a better position to answer queries from your customers/team about your orders. Your account on Vdepot’s system can be accessed from anywhere to keep you up to date in real-time. Tracking parcels, minimum order alerts, stock movement and detailed reports should be accessible whenever you need them.
Phased 3PL Implementation
If you’re still undecided on whether to pass your fulfilment on to a 3PL it may be beneficial to outsource a small number of products, typically the items with the biggest throughput. By trialling a few products first you get to understand the benefits before having to make the big jump of outsourcing completely. You can then move more products over to them as you feel comfortable.
Many 3PLs like Vdepot allow you to trial a few lines first and may even offer favourable terms as a trial period to really allow you to see the benefits of outsourcing.
So does warehouse outsourcing make business sense for you?
Whether you should outsourcing your warehouse & fulfilment really depends on your business circumstances. If you have high order volumes, your product sales really fluctuate depending on the season, or even if your product requires quality checking/gift-wrapping/reworking, it can make business sense to consider entrusting a specialist company.
What you should not do, is shy away from is finding out… it may seem daunting and time consuming, but really, the process can be quite quick and painless.
If you would like to know more about how we operate, costings and how we can implement any of the above, please get in touch with our team.