E-Fulfilment – What is it? [.blue]What does it mean for online stores?[.blue]
July 27, 2021
If you’re running an online retail store and have been looking at ways to improve your shipping, returns and stock visibility, you’ve probably come across the terms 3PL and e-fulfilment.
Let’s take a look at what they mean and what they can do for you.
What is e-commerce fulfilment or ‘e-fulfilment’?
We’ve all heard the stories of multinational companies that started in a garage – Apple, Google and Microsoft are prime examples. Online retail has its own success stories that started with the car being banished to the driveway. You know the drill: buy or make some stock; set up an e-commerce website; wait for those purchase emails; package up your consignments and head over to the post office or await courier collection.
When you’re small, selling a couple of items a week as a side hustle, it’s a viable model. But once you reach a certain size (and you know when you’ve got there), you suddenly realise you’re spending an inordinate amount of time packaging, sending, tracking and dealing with returns. And it’s eating into the time you can devote to your products and marketing them. Not to mention the fact that your “garage” is now the hall, stairs and landing plus the kitchen table.
That’s where third-party logistics (3PL) or e-fulfilment comes in. It’s an all-in-one storage, shipping, tracking and returns partner for your online retail business. Overnight, your job returns to the thing you love doing – finding new products to sell, working on new designs, putting yourself out there, and maintaining and optimising your website. Because as soon as you get stock to sell, you send it to the 3PL company and it enters their system and you can keep track of every single item remotely.
In fact, if you’re sourcing goods from other suppliers instead of making them yourself, you can arrange for them to be sent from their warehouse to your e-fulfilment centre without you ever needing to handle it yourself.
And best of all, your car gets its garage back.
The ecommerce fulfilment process
From the customer’s point of view, the justification for ecommerce is that it’s convenient – simple as that. It’s just so much easier to buy things from the sofa than it is to get them from the shops. And now that the buying public is accustomed to mere convenience, people are looking for added value in their ecommerce experience: speed of delivery, loyalty bonuses, options and great deals. Competition is no longer in the next street or the next town, it’s both global and readily accessible. So it’s up to retailers to respond to that demand.
Order fulfilment is probably the most important of all the tasks of the retailer. A brilliant website, great products and supreme marketing can all count for nothing if the business gets 1 star reviews because orders are late, damaged or wrong, or simply fail to turn up. Word spreads fast online, and bad reputations are hard to shake off.
Integration is key to the process creating a seamless link between the back end of an ecommerce store and your 3PL partner. This ensures that day to day, there is no management of orders required for them to be shipped, they simply get fulfilled automatically. Once this level has been reached, retailers are more interested in trends and sales figures rather than each individual dispatch. Payments are automated, so why shouldn’t the rest of the process be?
So as you can see, using a third party logistics company means there’s a lot less work to do at the vendor’s end. But there’s more to it than that. Don’t forget that using a professional logistics partner also draws on their expertise. The efficiencies that you have baked into your overall order fulfilment process are multiplied as soon as the 3PL company gets hold of your order.
It’s their job, after all, to see to it that the consignment makes it to the door of the customer in the most efficient way. They won’t just grab your products off the shelf and put it in the next available van – that could mean the van driver’s route could put your customer’s order at the end of a very long round trip.
All the customer’s delivery data will be attached to the order, so the fulfilment centre will put its powerful computational power to good use to ensure it goes to the courier that’s best suited to meeting the delivery deadline. We’ve all sat and watched the delivery van’s route mapped out on our phones as it counts down to the knock on our doors. The route it’s taking isn’t random – it’s working through a series of customer deliveries, probably from a wide range of sellers. But because the sellers are all integrated with the fulfilment centre, and the depot itself works hard to calculate the most efficient routes, the whole complex process is made to look easy.
The end result? Happy customers.
The role of automation for Ecommerce Fulfilment
At Zendbox, we’ve built an entire fulfilment business around one of the most advanced artificial intelligence solutions in the industry. We can confidently say that it’s the reason we can offer such an efficient service to sellers ranging from household names like Amazon, Shopify, Ebay, to Etsy shops.
The solution was designed and built from the ground up by ecommerce experts who had been at the coal face of the industry from its inception. They had seen how a culture of patching up existing software to get it to work with existing solutions and warehouse hardware was the cause of – not the cure for – mistakes, lost inventory and slow service.
First, AI is brought in wherever there’s a predictable, repeatable process, freeing up our excellent staff to work on the tasks humans are best suited to. Every single item has a code that locates it, so the moment your shop’s order comes through to us (seconds after the purchase is made), it goes into our system and the journey to its end-point (the customer) is determined via optimisation.
AI is excellent at working out when the perfect moment is for the package to leave the shelf in the fulfilment centre and make its way to the packing and dispatch area because it works out the whole product journey in an instant, something a human would need minutes to do. It’s how we can dispatch 99.7% of orders the same day that they are received, an incredible feat of logistics.
As a retailer, you get 100% visibility of any product up until the moment it is safely in the hands of the customer. Thanks to Zendportal, our proprietary customer intelligence platform, you can keep tabs on your stock so you can see when you need to replenish certain items, and set up alerts so you’ll always know when something needs re-ordering. You’ll also be able to see exactly where any purchased product is on its journey from storage to door – ideal if you’ve got impatient customers on the phone. This level of visibility and predictability is only possible because AI from the fulfilment centre feeds into it.
AI even plays a part in choosing a shipping provider. We have relationships with all the major delivery companies, and the system can decide which one would be best for every single order that comes through, based on their routes, delivery slots and availability. That adds up to much greater efficiency, which of course passes on savings in time and money to our clients. Find out more about fulfilment intelligence here.
Once you integrate Zendbox into your ecommerce store, you have all this capability at your fingertips. You’re plugged into a fulfilment system that uses great people, cutting edge technology and a trusted network of couriers and shipping experts to give your online shop the professional edge you’ve been looking for.
If you’re looking to switch up to professional delivery and warehousing, or are researching new partners to fulfil your customers’ orders, there’s never been a better time to get started with Zendbox.
Gilson leads the dynamic marketing team at Zendbox in producing insightful content designed to help eCommerce businesses scale up. With over 20 years of digital marketing experience, Gilson is highly adept at discovering business hacks and providing solutions to impossible problems.