FULFILLMENT FOR BUSINESS

Fulfillment services are a range of operations aimed at order delivery to a buyer. Fulfillment in logistics can include order receiving and processing, goods storage, preparing orders for dispatching, arrangement of delivery returns processing.

The term fulfillment is derivatives from a verb as “to fulfill”, and this service is also called “order fulfillment”. That describes the essence of it. The logistics provider assumes all the tasks from the moment a customer makes an order and until it is delivered. Thus, the main advantage of fulfillment is the closed issue of goods delivery without investment in a warehouse, staff recruitment, working with couriers, etc.

Fulfillment is especially in demand among small and medium-sized businesses. It is not cost-effective for such companies to build their logistics, especially if their goods turnover is small. It makes sense for big enterprises to ask for this service during the peak sales period. In this case, fulfillment will help to avoid spending on additional storage space and hiring seasonal staff.

Fulfillment services imply outsourcing of business processes from the moment an order is made to its delivery to an end consumer. Generally, the first step in the order fulfillment process is the transportation of a customer’s freight to a logistics provider warehouse. This is an important step because each unit has to be entered into a 3PL’s WMS and a client has to get a full report on the work with his products. 

The next stage is placement in a warehouse and storage. A customer can be sure that his goods will be stored in optimal conditions. However, it is worth considering that the longer the goods are stored in a warehouse, the more expensive the service costs. When a 3PL gets information that a specific order has to be prepared, it assembles and packs an order and controls this process. After the order is ready, it is transferred to a courier company. If the order is returned, a fulfillment provider undertakes reverse logistics.

Thus, a customer can concentrate on his business core activity. There is no need to rent a warehouse, hire and train warehouse staff, cooperate with couriers, etc. Service quality is also guaranteed.

A fulfillment provider is a logistics company that provides fulfillment services to a client company. A logistics provider is an intermediary in a seller-buyer chain. Besides standard procedures such as warehousing, assembling, delivery arrangement, it can provide additional services. Usually, it is a call center service, photo and video recordings of goods for a customer’s site, preparation, and attachment of promotional materials, etc. At the same time, a business can decide — to transfer all tasks of order processing and delivery to a provider, or just a part of them.

When selecting a fulfillment provider, a customer needs to pay attention to some points. One important thing is the fulfillment provider’s experience with a specific product segment. For example, if a service supplier has experience with clothing and footwear, he likely has well-developed returns processing, since these goods are most often returned by consumers. A fulfillment provider’s warehouse location also matters. It will be profitable if a 3PL’s warehouse is closer to end consumers. Therefore, a business can optimize transportation costs.

A fulfillment center is a warehouse where goods are received, counted, and labeled. No matter in what form goods are received, all items are accepted by pieces. Details about each product are entered into the Warehouse Management System.

While storing data about each SKU in WMS, a logistics provider is always aware of product quantity in its warehouse. The data entered in an IT-system also helps to track information about the location of SKU, its dimensions. Order assembling and packing are fast and accurate. This is important because there are a large number of goods from different customers in fulfillment warehouses and all orders must be delivered on time. A video surveillance system makes it possible to quickly resolve issues of goods spoilage or loss.

However, it is worth taking into account that some fulfillment providers do not work with all types of goods. This may be due to the lack of suitable storage facilities and other restrictions. For example, a provider will not store and process in the fulfillment center goods that are not allowed to be sold remotely in Ukraine. These are pharmaceuticals, tobacco, alcohol, perishable foodstuffs, and large freight.

For marketplaces, fulfillment services are especially important. Small online stores may delay their entry into marketplaces since they do not have well-organized logistics and cannot arrange delivery with a large number of orders. Using fulfillment on a platform for online sales solves these problems. An online- store enters into a contract with a provider and can no longer worry about goods storage and delivery. A 3PL is responsible for customer relations, goods storage, and order delivery. It can also be a payment agent that allows a seller to refuse from the online cash register. In addition, fulfillment providers can process returns.

Due to logistics outsourcing, an online store does not need to do non-core tasks and can focus on its promotion in the marketplace. However, even an effective product advertising campaign can fail if there is no smart customer interaction and fast delivery. Fulfillment services resolve these tasks, which helps to raise the customer service level. So, fulfillment allows an online store to get important competitive advantages in a highly competitive marketplace.

The service of fulfillment in logistics can be ordered from fulfillment providers. These are logistics companies that have experience with the eCommerce segment. In contrast to 3PL providers, which work with goods in pallets and boxes, fulfillment providers work with single-piece goods. 

A special Warehouse Management System is needed to enter such units into the program. Not every 3PL provider will invest in this software. Without a careful inventory of each product, it is impossible to organize efficient order processing.

However, with the growing popularity of online sales, logistics companies adapt to the clients’ needs. Now also large 3PLs learn the fulfillment process features and provide this service to the business. Some marketplaces offer online shops fulfillment services on their platform.

But the fulfillment market in Ukraine is still developing. This service is more common in major cities. To find out about offers from fulfillment providers in different cities of Ukraine, submit a request on WareTeka. Our experts select a fulfillment provider for your requirements.

If a company decides to outsource its logistics for the first time or is not familiar with the fulfillment features, it can be challenging to select a service provider. Despite all the advantages of fulfillment services, there are some things to pay attention to.

It is necessary to find out which storage facilities and what equipment the logistics provider has. If possible, check it. Since the range and cost of services are different from different fulfillment providers, it is necessary to compare several offers from different service suppliers. It is also desirable to familiarize yourself with feedback from other companies on cooperation with the logistics provider, location of its warehouses, and experience of different types of goods processing. Otherwise, a business may suffer losses by transferring a significant part of its logistics to a contractor.

For companies that want to find suitable fulfillment services, the best option is WareTeka. Our specialists will prepare an individual offer to solve your business logistics challenges. We do not impose specific contractors, but offer options that are appropriate in your particular case. To order a service or get a consultation from our experts, fill in the form on the page “Fulfillment services”.

Also we have warehousing and storage services.