The process of order fulfilment is pivotal to the overall success of your ecommerce business. Ultimately, order fulfilment can take many different forms and stages, so knowing the best approach to take can increase the potential of scaling your ecommerce business.
Striking a balance between a cost-effective strategy and overcoming obstacles, such as changes to legislation and shipping tariffs, whilst maintaining excellent customer service levels and customer satisfaction can be a challenge.
So, we’ve put together this guide of the seven best tips you can implement, ensuring your order fulfilment is in tip-top shape to maximise and elevate your ecommerce business.
1. Understanding order fulfilment cycle time
For customers, time, speed and efficiency are the most critical components that determine how satisfied an individual is with a product or service. By having a clear understanding of your order fulfilment cycle time, you will be able to track metrics, measuring the effectiveness of your cycle time and seeing if improvements are required and how best to adopt those.
As ecommerce depends on numerous factors that are uncontrollable, such as rates and shipping times, cycle times can vary between days and even weeks.
Differing cycle times
There are also several cycle times that need to be classified so you can accurately calculate the overall cycle time – so ensure that you account for the following:
- Promised customer order cycle time – Expected time for a customer to receive their goods.
- Actual customer order cycle time – Average time it takes for a customer to receive their goods.
- Cash to cash cycle time – The time taken from spending money on goods to receiving money.
- Supply chain cycle time – The amount of time it takes to fulfil a customer order if items are not in stock.
When examining the order fulfilment and supply chain capacities of your company, each of these methods for measuring order fulfilment has importance.
However, avoid overthinking every aspect, although it is beneficial to understand and monitor as many facets of your business as possible, it can become distracting to the point where your efforts are refocused to aspects that may obstruct your overall operations.
2. Classification of inventories
Knowing exactly what products you have and plan to have is essential, as this enforces reliability throughout your business operation. Scrutinise each category, and the quantity of each item within those subcategories if applicable, so that you know the exact figure for each.
Putting your inventory together based on how quickly it moves is one of the most popular methods for organising your products and also benefits your eCommerce business by making it possible to manage stock effectively.
Equally, by grouping products in warehouses, you can identify which channels are performing and carry out comparative analysis on this to maximise the effectiveness of it.
By partnering with a fulfilment company, all of this can be taken care of, without the need for you to worry about being extremely thorough, meaning you can tailor your business strategy towards scaling your business even further.
3. Choosing the right shipper
Having an order fulfilment process is effective, but it will only run smoothly across your whole operations if your shipping company aligns with your business needs. Choosing an adequate shipper where necessary is fundamental to your business reputation, as delays and waits on goods will incur customer frustration, leading to potentially negative feedback, despite this being out of your control.
Always carry out due diligence on your existing shipper. Do they provide precise, real-time order tracking? Has there been any instances of late shipments, delayed shipments, lost shipments, forgotten shipments, or damaged deliveries? If so, you should spend time and money looking for a new, superior shipper who can satisfy your fulfilment needs.
4. Automate your order fulfilment
Automation is an absolutely essential part of effective order fulfilment if you want to make sure your eCommerce business maintains pace with other merchants.
You can improve the effectiveness of your employees by automating monotonous chores. A warehouse management system, for instance, can plan the best path for picking. You may increase order fulfilment speed and cut costs by doing this.
In addition to increasing your sales opportunities, automation lowers operating expenses and significantly lowers the chance of human error.
You will gain from increased transparency of your business’s overall processes if you have an inventory and order management system in place. Then you can examine each one of these and decide how to speed it up.
Or why not rapidly and efficiently integrate inventory into your systems as new product batches arrive at your warehouse, another solution is to use barcode scanners.
5. Warehouse locations
In the digital age, customers expect deliveries to be on time and efficient, and as volume is increasing all the time, organising warehouse locations that are advantageous for your cycle times and customer satisfaction will benefit your business.
Consider partnering with a fulfilment company with local links to a port or that has many warehouse locations, to maximise the effectiveness of your operation. Discuss factors such as swift picking and packing, and discover if you can store products across various warehouses so that your goods reach customers in delivery areas at a faster rate.
6. Analyse your business operations continuously
No eCommerce business will continue to improve and scale without scrutinising different areas of the fulfilment process to understand how performance levels are going.
Consider your own KPIs, such as cycle times, customer retention rate, customer satisfaction and delivery times, and identify areas which can be improved by looking at analysing the following areas:
- Percentage of shipments made on-time – Check if there is a discrepancy in where you feel this should be at when looking at figures.
- Frequency of order errors – These can usually be carried out by fulfilment companies and their seamless cloud-based order management systems, usually across multiple stages of the process, like picking, packing and shipping.
- Cost per order – Be sure to maintain a check on how much you are spending per order. Cost reduction wherever possible is crucial, so if there are ways you can save by being more efficient, highlight the problem areas and address them.
- Return rate – Calculate your return rate, although there are always going to be returns, keeping this low where possible is effective for customer satisfaction and the reputation of your retailer.
- Customer retention rate – Key to establishing how satisfied your customers are is the customer retention rate, which is a metric designed to measure the ordering experience of your ecommerce store.
7. Communicate with your customers
With connectivity being so easy to access and monitor, gauging the opinions and thoughts of your customers can help decipher what sort of experience they are looking for and what they are receiving.
Aside from reviews, questionnaires and other forms of social communication, interaction with customers on their order statuses is arguably as important for customers. Through partnering with a fulfilment company you can keep customers constantly updated throughout the entirety of their order, illustrating an extra layer of care about them and their value. Order management systems can provide timely, on-demand, real-time communication on order status, from order receipt and processing to order shipping and delivery.
Seamless order fulfilment with TSP
As this guide illustrates, effective ecommerce order fulfilment is the pivotal component that determines whether your business is scaling or stagnating.
To make sure that your operations operate well and that clients are completely satisfied, you must constantly strive to create a more efficient and streamlined procedure.
By partnering with TSP, we can take care of all things order fulfilment, so business owners may concentrate on other aspects of their operations while we handle the rest.
Additionally, by giving carriers access to the most recent technology, enabling them to expand their businesses, and enhancing customer happiness, to mention a few,can assist save costs and enhance commercial terms. Contact us today and find out if it’s time for you to outsource your order fulfilment.
