5 Things you need to know about eCommerce Shipping and Fulfillment


5 Things you need to know about eCommerce Shipping and Fulfillment

Ecommerce is one of the fastest growing industries in the world. The reason behind being the fact that consumers want to enjoy the convenience of receiving the desired products without even having to move from their place.

The widest variety, price range, ability to explore maximum discounts that too without keeping a step out of your home has lead to the exponential growth of eCommerce world.

Today when almost everyone is in a race to have their online presence felt, the competition is growing too hard to perform and sustain the growth.
Now not only does the quality of products, efficiency of your online store and pricing matters but “Shipping Costs” and the way you fulfill orders too play a vital role.
Shipping costs being one of the key components of the price paid by the consumer, pose to be quite a major factor responsible for cart abandonment.

Alongwith shipping costs, the next important issues adding up to dissatisfied customers are delayed shipments, wrong products delivered, poor packaging and unclear return policies.
For small businesses, every sale when successfully completed matters a lot. Hence the most important concepts of shipping costs and order fulfillment need to be strategized.
While convenience and shipping go hand-in-hand, shipping has achieved a significant status to make or break the success of B2C and B2B businesses. The way you fulfill online orders and the way they are expected by your customers serves as an incentive and drives sales.

This blog would be a guide to eCommerce shipping, sharing some tips and tricks that would really help you formulate and execute your fulfillment and shipping strategy.

1. Clarify your ORDER FULFILLMENT Process.

Order fulfillment

Order Fulfillment is a process which includes a number of activities right from receiving the products in your shipment to sorting and managing the inventory, receiving orders, product pick-up, quality checks, packaging till shipping. Quite a long yet significant process for the success of your business.

Online shopping has witnessed such an amazing growth over years just because of the convenience it offers to the customer.

Convenience to find desired products at just a click, convenience to find the suitable ones from a massive variety, convenience to utilize the best price bargains, convenience to receive the orders without moving out of their personal space.

So, very initially you should consider getting your business a nicely designed with an amazing user experience which lets them navigate easily and find their requirements quickly. Anything which your customer should know about your order fulfillment and shipping process, should be mentioned clearly and explicitly.

Like, if you consider offering Free Shipping, then it should be the first thing that your customers see when they land on your website.

2. Ship it Right.

Optimally, as the business grows and evolves, you can figure out what type of Shipping policy works best for your business. There are a few shipping policies for online businesses. These are as follows:

a) Free Shipping

All the consumers love receiving their orders without having to pay any shipping charges for it. As per Pitney Bowes Global eCommerce study 2018, 79% of the consumers prefer receiving their products free than fast. An astonishing figure of 91% of the consumers would leave your site if they do not get “free and fast” shipping option.

But for the businesses, it is not equally loveable always. Although, retailers admit that offering free shipping is not only an attractive shipping policy but an equally good marketing tool, yet its effect on profit margins need to be studied on priority.

Even though free shipping brings you more sales but the cost incurred on shipping each product might not result in fetching you a good advantage.

Optimally you can utilize the strategy of free shipping in either of the two variants explained here. One option is to waive the shipping cost to your customer if the amount of their cart exceeds a certain amount. As consumers are willing to add as much as $25 to their order just to get their products “shipped free”.

Another option is to use this sales attracting tool as a part of your marketing strategy. You can offer your customers free shipping for a particular period (say days or hours) and/or on specific products. Some other variants can also be worked on which suits your business.

b) Table Rate Shipping

Table Rate is the shipping policy which allows you to decide the shipping cost as per the product. Considering the size, weight, value, distance and the number of items ordered by the consumer, you can customize the shipping charges.

Commonly practiced by businesses, those orders which are to be delivered within the certain and pre-specified radius are charged a different rate than to the one which has to be delivered out of that radius.

This rate can also be put to practice considering the number of orders placed by one consumer. Table rate shipping method too can be implemented in a number of variants. You can always test and apply and find the one which best fits your business model.

c) Flat Rate Shipping

As the name itself suggests, flat-rate shipping means applying a particular amount of shipping charges to all the products. Irrespective of shape, size, weight, value, and distance, all the products are shipped with a fixed/flat rate.

This type of shipping policy is rarely seen, yet the consumers who aim to buy big and bulky products find it to be advantageous. For the business owners, the advantage can be figured out in the liberty you have to dictate the amount of flat rate that would be charged.

d) Live Shipping

As the name suggests, it gives the consumers live options of selecting their shipping carriers. Leading shipping carriers like DHL or FedEx or any other available carriers can be suggested to the customer to choose from. Live shipping is a less commonly used B2C method of deciding shipping charges yet it makes it clear with the consumers as to for what they are choosing to pay.

But it is a great strategy when it comes to B2B models. The success of this shipping method lies in the fact that as such shipments precisely consider the quantity, weight or the shipping distance, it offers complete transparency and establishes faith between the parties involved.

Live shipping model also gives you an option to add a surcharge to the shipping rate for the costs incurred in order fulfillment and/or packaging costs. Live shipping also reduces the burden of returns due to “product not received in good condition” due to transit.

3. Choose your Carriers.

Choose your carriers

As a part of your eCommerce shipping fulfillment strategy, the next major step to focus on is choosing the right carrier. Now when you are clear with what charging model you are going to apply to your products, it is time to look for one that fits in perfectly.

For this step, you need to contact the popular service providers and compare the rates they charge. This step involves detailed research, thorough feedback on the services and the extent of negotiations.

Detailed research might involve as to which service provider has maximum coverage of geographical areas if it is fit for carrying the type of products your business has and the time it takes to deliver a package.

Feedback would involve the feedback of the customers and the condition in which the packages are received by the customers. For if you deal in electronic goods which require a certain level of ‘care handling” and the service provider you selected does not have competence for the same, then it is a great mismatch which can lead to high losses.

Extent of negotiations relates to the rate flexibility that result from negotiations. When you offer to share an extensive load of your orders with the carrier, they tend to lower their rates and sometimes even waive off their fee after a certain limit. Discussing the geographical coverage and the time involved to deliver a package within a certain radius can help you a lot in deciding the final parter.

4. Packaging.

packaging boxOnce done with all the major prospective options available for deciding your shipping options, next step in the ecommerce shipping and fulfillment strategy is to work out on how to dispatch the products ordered.

Not a surprise anymore, good packaging and delivering the orders with a touch of personalization in B2C transactions helps you stand out amongst the competition. Personalization has been proved to one of the top factors convincing customers to shop with you again. It is highly recommended that you deliver an experience to your customer rather than just delivering a package.

Creating the right design for packaging would eventually render you far more benefit than the time invested in doing it. Considering the weight and size of the products ordered, there should be a decent balance between the functionality and design of the package.

B2B shipments might not consider and deliver an equally good result and hence you can focus more on functionality than on presentation.

5. International Shipping.

Resorting to international shipping takes your business to next level. When you have worked out and found the best mix or the perfect method of deciding shipping costs, you can explore international markets.

Although International shipping gives your business new heights, yet it comes with a number of restrictions. So when you think of expanding out of the boundaries of your country consider finding the following details in the first place:

a) Is your product in demand in the international market?
b) Does your product suit the international shipping?
c) Explore the right international service.
d) Find all the import-export restrictions in the country you are planning to enter.
e) Find the custom taxes and further document requirements in that country.

Just like any online business, even international markets have their own challenges with regard to customers, order fulfillment and shipping. So you need to consider all the facets of this alluring opportunity before you take a step forward.

Closing Notes

The above mentioned process is a guide to help you manage your online store’s order fulfillment and shipping tasks efficiently. Studies have shown that 7 out of 10 retailers find shipping costs the major challenge to counter the operational costs. But an ecommerce store developed with Magento can help you combat challenges that your competitors continue to deal with.

Any version of Magento 2.2.2 or later is equipped with shipping software that can turn shipping into a profit machine. When you have the support of such a sturdy eCommerce platform, then you can find time to focus on other operational areas of your business.
For any queries on eCommerce store development in Magento 1 or Magneto 2, please feel free to contact us.

Until next time, stay fulfilled and keep shipping.

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