What is order fulfillment?
Order fulfillment covers the complete process from when a sale takes place all the way through delivery to your customer. Successful order fulfillment depends on a third party to complete the order fulfillment steps for the ecommerce online store from receiving, processing, packing, picking, and shipping an online order to customers.
A successful retail order fulfillment strategy is vital for ecommerce businesses to stay competitive and build customer loyalty.
How to determine your order fulfillment strategy
There’s no such thing as a one-size-fits-all order fulfillment strategy. Here are some important factors to keep in mind when scaling fulfillment for your online store.
1. Business size and order volume
- How many SKUs does your business sell?
- How many orders are you currently shipping each month?
- How many orders do you predict you’ll be shipping next month? Next year?
The number of products you sell and your monthly order volume play a big role in finding a fulfillment solution that works for you. If you’re new to the world of ecommerce, your fulfillment strategy is likely to look very different from, say, Walmart or Target.
Low order volume may make it more cost-effective for you to keep fulfillment in-house, as opposed to outsourcing. If you sell a limited variety of products and are shipping just a few orders each week, you probably don’t need a full inventory or warehouse management system to keep track of your inventory and operations.
If your business is growing quickly and your average order value is steadily increasing, keep in mind when you’re likely to outgrow your fulfillment strategy. It’s important to make sure your ecommerce fulfillment strategy can scale with you.
2. Sales channels and technology
- Where are you selling online?
- Are you selling on an ecommerce website, a marketplace, or both?
- Which ecommerce platform are you using?
Your fulfillment strategy should complement and support your online sales channels, especially from a technology standpoint. Order fulfillment software that already integrates with your ecommerce platform and online marketplaces can help you manage the entire order fulfillment process more efficiently without having to do any developer work.