Ecommerce fulfillment is an integral part of the supply chain, which entails the entire process of order processing, delivery, and return management over an e-commerce platform. Ecommerce fulfillment is the summation of independent and codependent services and workflows.
The fulfillment channel is set in motion when a purchase is made online and ends when a customer receives the order. Ecommerce fulfillment constitutes the entire journey of the order, including acquisition and storage of inventory, picking and packing of items, shipping logistics, and returns management.
Order fulfillment process
- Inventory acquisition and forecasting
Inventory management is the monitoring of non-capitalized assets and stock items. Inventory ordering, receiving, and restocking are grouped under acquisition. Whereas, inventory forecasting is a tool of inventory management to ascertain inventory levels for the future. It acts as a measure for tracking sales and demand to prevent stockouts and backorders.
- Inventory storage
Warehousing is the act of storing inventory in a facility before order fulfillment. Warehouses store inventory adhering to
strict safety standards and in an organized manner to locate the goods with ease. With the introduction of the rapid
e-commerce fulfillment process, products are shipped from the fulfillment center to the consumer directly. Small or new
businesses carry out warehousing from their basement or garage until they outgrow the space. Subsequently, renting a
storage space is a viable option along with leasing a warehouse or outsourcing a fulfillment center.
- Picking and packing
Pick-pack fulfillment is a traditional operations model in a fulfillment center. Picking refers to using a picking list to retrieve
items from inventory as soon as an online order is placed, and packing is the process of putting all ordered items in a box
with suitable packing materials. Thus, the most suitable picking and packing model can enhance the entire fulfillment
process. Eshopbox's streamlined pick-pack methods enable you to process orders efficiently.
- Kitting and assembly
Bundling two or more similar products together into a single unit is kitting or product bundling. Whereas, in a process
where two or more components of an individual product are combined, it is termed as an assembly. Both these processes
streamline the packaging and distribution needs of a merchant. Upon order placement, a unique code or SKU (stock
keeping unit) enables identification for retrieving products in the storage facility. Such elaborate procedures of kitting and
assembly add a few extra steps in the process, and it becomes an expensive, inefficient, and time-consuming service to
complete. However, they offer significant benefits to a business, including simpler and efficient inventory management as
well as a reduction in shipping mistakes.
- Shipping
Shipping is the physical movement of commodities and merchandise goods from one point to another. Initially, shipping
only referred to transportation through the sea, but its meaning has extended into modes such as land and air. In an
e-commerce landscape, shipping constitutes the movement of orders from the warehouse to the customer. The delivery
methods offered to the online shoppers and their pricing is the prime factor for customer engagement. Shipping
capabilities and services depend upon the location of the inventory as well as customers. A well-distributed network of
fulfillment centers where warehouses are strategically located ensures quick turnaround time. Shipping costs also decline
with larger volumes. The market is flooded with an expansive range of prompt shipping options to attract customer
attention by providing free or flat rate shipping. Small or new enterprises ship their packages independently. Whereas,
more established e-commerce companies negotiate with shipping providers for discounted rates owing to high order
volumes. Eshopbox's established background with courier companies and negotiated rates ensure the most cost-effective
shipping.
- Returns
Return management involves receiving, assessing, and processing returned orders into the available stock. Operationally,
returns bear huge costs and consume a lot of time due to inspection and refurbishment of goods. Adoption of a perfect
return policy is crucial in online businesses as customers make purchases without any physical contact with the product,
which causes a higher return rate than brick-and-mortar retail. Some fulfillment services provide prepaid return labels,
share tracking information, support integrations for automated texts intimidating return and refund updates to the
customers. Eshopbox has created a returns management system beneficial for you and your customers.
Fulfillment service models
- In-house fulfillment
Also known as self-fulfillment, it is when an online enterprise fulfills its orders internally. The model offers complete control
over the entire fulfillment process to the merchant. The scope for this model ranges from small order volumes that are
fulfilled from home to investments in a larger scale operation with a relatively extensive facility. At this stage, self-fulfillment
diverts the core focuses of a business, i.e. acquisition of more customers, development of new products, and launch of
marketing campaigns. With an increase in sales, it can get challenging to manage fulfillment in-house, which leaves only
two options to establish a fulfillment infrastructure or outsource it completely.
- Outsourced fulfillment
Also known as third-party logistics (abbreviated as 3PL, or TPL, is when an online enterprise outsources the entire
fulfillment process to a third-party specializing in full-service fulfillment like Eshopbox. As the 3PLs work with numerous
merchants, they operate multiple fulfillment centers. Their logistical expertise and capacity facilitate negotiations on
substantial discounted bulk shipping rates from carriers. Outsourced fulfillment eradicates the need to create fulfillment
infrastructure with a specialized workforce, manage a large-scale operation, or invest in equipment and technology.
- Dropshipping
When a store sells a product on an online platform by purchasing it from a third party and then ships it directly to the
customer’s shipping destination. The seller acts like a middleman who connects the customer to a product without the
possession of the products sold. It requires less capital and overheads but yields lower margins.
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