How to choose the ideal partner for fulfillment?
The outsourced fulfillment service brings benefits only if you can rely on a reliable logistics partner. As in personal life, open communication is an important prerequisite for mutual and long-term positive cooperation from the very beginning of a business relationship.
CCO & Co-Founder Skladon
Advantages and disadvantages of logistics outsourcing
Advantages of logistics outsourcing
By entrusting logistics to an external partner, you gain time for other areas of your business, such as streamlining sales channels, marketing, optimizing your product portfolio, and more. Outsourcing is thus a prerequisite for your growth.
Operating cost savings
You only pay when you sell and do not deal with the downtime of your warehousekeepers at the moment when the demand for your products decreases. Thanks to the accumulation of orders from other e-shops of your partner, you will also save on transport or the purchase of packaging materials.
Reduction of fixed costs
You only pay for the space you actually use. Administratively, you do not deal with insurance of goods in the partner's warehouse or energy expenses. Change your fixed costs to variable ones!
By outsourcing logistics, you do not invest in warehouse equipment, such as shelves, workbenches, printers, work aids, warehouse system and other necessary items for its operation.
Eliminate worries about storage space and employees
A responsible logistics partner is able to offer you the appropriate size of warehouse space and staff capacity according to your current sales needs - for the peak season and sales decline.
Elimination of logistical legislative concerns
You do not have the legislative and administrative obligations associated with the operation of the warehouse, such as contracts, internal regulations, permits, certificates, system revisions or security measures.
Transfer of worries with shipments
The logistics partner is fully responsible for the correct and timely delivery of orders to your end customers, even during peak season. They will handle complaints, refunds or customs duties for you at the time of shipment to third countries.
Disadvantages of logistics outsourcing
Wrong set up of collaboration
If you choose a low-quality partner, logistics outsourcing can permanently damage your business. We recommend that you get to know your partner right at the beginning of the business relationship, specifically ask detailed questions (see our questionnaire), verify your expertise and communicate openly on both sides.
Loss of physical control over the goods
By outsourcing logistics, you sell goods that most of you have not had a chance to visually inspect. This can be partially solved by reference visits to the warehouse, which are, however, a limiting solution. That is why it is important to know all the operational operations of the new warehouse, to define scenarios and rules of cooperation. Find out in advance the degree of flexibility for your specific requirements.
Loss of systemic control over goods
Find out how you will be given information about your stocks, orders, complaints, returns, etc. The ideal solution is a client application that provides a complete overview of the client's logistics and its information is in real time, online and 24/7.
Poor system connection
See how the fulfillment expert is able to ensure the correct two-way transfer of all relevant data between your e-shop platform and your warehouse management system (WMS). Get sure that the information on your e-shop will always be up to date.
3 basic areas when choosing a partner for logistics
Ask questions related to the content of the offered service, price list structure, adaptation to your requirements, guarantee of picking accuracy, selection of carriers, connection of your e-shop with the partner's storage system, etc.
Do you know the answers to questions about the conditions of insurance of your goods in the partner's warehouse, security system, security and backup of your data, expertise of warehouse staff or rules of warehouse visits?
Do you know what time limits your logistics partner has in terms of order processing speed? Or how flexible is it in answering questions related to the orders of its clients' end customers?
"Now we can focus all our energy on customer support and sales, knowing that our logistics are taken care of by experts. We sell nanofiber drapes and respirators, so our sales are quite affected by the current epidemiological situation and government measures. Thanks to the cooperation with the fulfillment service, we can adapt very quickly to high demand."
COO nanoSPACE s.r.o.