From click and collect to sellers and business owners wanting to be included in every step of the way when they outsource, fulfilment isn’t easy or simple in this day and age. In this piece, Jake Rheude, director of marketing at Red Stag Fulfillment, reveals the main challenges.
There are some unique challenges you’ll face as you grow an ecommerce operation, especially in the realm of fulfilling orders and promises. Below are what I believe are five of the costliest issues that can crop up at any point and quickly eat into your margins or your reputation.
1) Customers are going to be demanding
Amazon has caused your average online shopper to think it’s easy to offer two-day shipping at a reasonable price. Be prepared for customers to ask for fast and cheap shipping, while you must figure out what’s affordable for your business.
You might also face increased demands at various times because ecommerce often sees orders rise sharply when something becomes popular. Shipment demands may vary greatly, so you will want to make sure your supply chain is ready to handle large fluctuations.
2) You can have too much choice
When we hear about choice, we’re often thinking of shipping. However, ecommerce companies sometimes have issues related to product options. If you have highly customisable goods or carry everything in many assorted colours, you can face trouble keeping stock and properly filling orders.
This type of business model also often relies on drop-shipping and selling products from others, which introduces more companies into your process and creates plenty of new opportunities for something to go wrong.
Limiting what you can control may make it easier for your company to meet the promises you make to customers.
3) Personalisation is difficult
On advice websites, you’ll find “personalisation” listed on every other recommendation article, at least. Customers want an individualised touch, and it’s a proven way to increase sales, impacting both initial sales and repeat purchases.
That’s great when you can do it, but it may be tough for small and growing brands. Personalisation requires knowing your customers and having the tech that can accurately create profiles, capture names and other data, and then turn those items into a compelling offer or bonus. Your business will need to be data-first, but you also must limit the use of personal information to avoid coming off as creepy and scaring customers away.
4) IT can get in the way
E-commerce is all about digital tech with different software packages controlling distinct parts of your business. Some smaller online stores run into issues with these programs when they don’t share data. Siloed information introduces manual processes that can cause disruptions or lead to errors.
Disjointed systems that fail to collect or share order information can quickly exacerbate other problems too, especially in terms of personalizing orders or forcing your fulfillment and sales to feel like two completely different business.
5) Shipping costs will vary…a lot
E-commerce order fulfillment options vary, and so do their costs. You might be running your own warehouse, shipping things from a garage or using a third-party to get things to your customers. Getting the same package to the same person in each of these cases may come with very different costs.
For small shippers, outsourced e-commerce shipping with shopping cart integration tools may be a more affordable way to get your orders out because third parties tend to have enough shipment volume that they can cut deals with carriers.
If you’re sending things yourself, you can pay different costs if you can’t negotiate those deals or if you are shipping from multiple locations. Turn to shipping calculators to understand the different ways you’re charged and how to find the best place to use as your distribution centre.
Jake Rheude is the director of marketing at Red Stag Fulfillment.
Image credits: Fotolia and Red Stag Fulfillment