4 Types of Order Fulfillment: Which One Is Right for You? 1
Types of order fulfillment process- 2
How to choose the right type for your business 4
Shopify dropshipping has taken the e-commerce business industry by storm within the past few years. Shopify alone has generated over three billion US Dollars in revenue during the fiscal year of 2021. But managing an e-commerce business through Shopify requires efficient fulfillment services. Without proper inventory management and timely delivery, the chances of business growth remain stagnant.
What remains a challenge is to make a proper selection of fulfillment methods. This blog discusses various fulfillment methods and their suitability according to the type and scale of the e-commerce business.
Types of order fulfillment process-
1. In-house fulfillment–
In-house fulfillment involves the e-commerce business performing the fulfillment process all by itself. From inventory management to picking and packing the orders and then finally dispatching them, everything is managed by the e-commerce business itself.
It involves the complete participation of the employees and the business owners. Thus, it lets the e-commerce business owners have full control over the fulfillment process. Along with the advantage of supervising the fulfillment process, in-house fulfillment has its disadvantages.
A major drawback is time consumption. When business owners will spend so much time monitoring the fulfillment process, they will have less time to concentrate on the business.
So, the scalability of the business becomes limited.
In-house fulfillment is usually preferred by DIY businesses. DIY businesses have a limited manufacturing and storage capacity. They also have a limited number of orders. Thus, they can rely on in-house fulfillment other than outsourcing to third parties.
Through proper management, in-house fulfillment is the easiest and most cost-effective method.
2. Third-party fulfillment–
Hiring a third-party logistics company to perform the fulfillment process is third-party fulfillment or 3PL. Third-party fulfillment companies offer different plans. E-commerce business owners can choose a suitable plan according to the services they need and their budget.
The modern consumer is impatient. Customers need their orders on their doorstep as soon as they order them. It has become very difficult to meet the expectations of consumers.
Managing affordable shipping rates and faster deliveries has become expensive and difficult for e-commerce business owners.
Thus, it is better to outsource fulfillment services to third-party logistic companies. 3PLs have all the expertise and resources to carry out the fulfillment process more. Moreover, they usually have a global network of warehouses that make inventory storage and faster shipping to customers more convenient.
Third-party fulfillment is not about outsourcing fulfillment. It is about outsourcing all the mess and worries related to timely delivery, customer services, and returns management.
Shipbear acts are the most suitable option when it comes to outsourcing fulfillment services. It offers a streamlined supply chain and fast shipping for as short as two to five days. Global network of warehouses and automated inventory management services makes Shipbear the most reliable fulfillment partner.
Dropshipping is a retail fulfillment method where the seller does not keep the products it offers for selling. The e-commerce business after receiving an order purchases the product from a third party. Later it ships the product straight to the customer. The merchant, which in this case is the e-commerce business owner never even sees the product it sells.
Not having to manage and keep the inventory is the only difference that separates dropshipping from a typical retail fulfillment model. In dropshipping the merchant purchases the inventory from a third party.
Dropshipping has a lot of advantages among which the greatest is not having a large capital. Since business owners need not buy inventory beforehand. Thus, they do not need thousands of dollars to invest beforehand. Dropshipping is easy to start. Also because of less investment, the overhead costs are also less.
Dropshipping business is not geographically bound. It can be started and managed from anywhere. Also, it allows business owners to have a wide portfolio of products.
Is dropshipping worth it? Although the dropshipping business model has a lot of advantages. Yet is not at all a stress-free way to a successful e-commerce business. Along with several advantages, it has some complexities to deal with as well. For example, sometimes the supplier might send low-quality products to the customers. The business will be responsible for the supplier’s error and have to return or exchange the product.
When dealing with several suppliers the shipping process becomes very complicated. Also, since the business is easy to start the competition in it has increased.
But, there is no problem without a solution, all the shortcomings of the dropshipping business can be overcome by dealing with them. With careful planning and consideration, all these shortcomings can be addressed and resolved to make the dropshipping business worth it.
When looking for dropshipping fulfillment partners Shipbear is one of the best choices to make. Shipbear is an award-winning fulfillment and dropshipping company that provides all services related to drop shipping. From product sourcing to quality checking, inventory management to shipping, Shipbear provides the best quality services.
4. Hybrid fulfillment–
Hybrid fulfillment is a combination of two types of fulfillment types. It allows business owners to fulfill some orders themselves and outsource the fulfillment of other orders through thor-party logistics companies. Thus, hybrid fulfillment is a combination of in-house fulfillment and third-party fulfillment.
For e-commerce businesses who want to opt for hybrid fulfillment, Shipbear provides fulfillment services at the global level. Shipbear takes over the burden of the fulfillment of remaining orders. Hence, the business owners can concentrate on other business areas such as marketing and manufacturing.
How to choose the right type for your business
Four different types of fulfillment strategies are under discussion. But which strategy to choose for what type of business is yet to find out. The following factors will make the selection process easy:
Shipping Times–Business owners opting for a third party or hybrid fulfillment should make sure that the company offers fast shipping times. Shipbear for example provides global shipping services for 2-5 days.
Warehouse Location–Shipping speed depends upon the location of the warehouse as well. Business owners should make sure that the fulfillment company’s warehouses have various locations. Shipbear in this case provides a global warehousing facility. This ensures a streamlined supply chain.
Branding and Packaging– It should be assured that the fulfillment company provides up-to-date packaging and personal branding options. Poor packaging might lose customers. Shipbear provides its clients with personal branding and packaging options. This includes adding a product catalog, company newsletters, personalized package designing, etc.
Shipping Rates and Cost– Different third-party fulfillment companies offer different shipping rates. E-commerce businesses should select the plan that best aligns with their companies’ costs. In this case, Shipbear offers the fastest shipping at affordable costs.
Communication and Transparency– It is always better to keep the businesses informed about the supply chain status and customer feedback. For this, the fulfillment process needs to be transparent. Shipbear ensures that the business owners are informed about every step of the fulfillment process. It keeps the whole process transparent.
Shopify dropshipping provides e=immense business growth opportunities to business owners. For a successful business, e-commerce business owners need a fast and reliable fulfillment service. The best recommendation is to partner with a third-party fulfillment services provider. A 3PL that has all the expertise to put in place the fulfillment process. For this purpose, Shipbear being an award-winning third-party fulfillment provider is the best choice.