If you own a growing Shopify store, you’ve likely been considering Shopify fulfillment services. If you’re beginning to see large growth in your ecommerce business, the time to consider a fulfillment partner is now. You don’t want to wait until it’s too late and you’re overwhelmed with orders. If that’s the case, it’s time to start thinking about warehousing, shipping, and fulfillment.
There’s no question about it, growing sales is exciting! Congrats! Still, this can be a make or break opportunity for your company, don’t let it pass you by. Most Shopify ecommerce merchants are stressed during growth with limited resources, so it’s a big decision. Is it time to reach out to a Shopify fulfillment partner?
You have your Shopify store, let’s talk about getting your product to customers. In all actuality, there’s only 3 ways to do it;
- You fulfill your own orders, either independently or with a team.
- You sell products from a dropshipper, they fulfill the orders for you.
- You team up with a logistics company, they handle your warehousing and fulfillment.
Make no mistake about it, self-fulfillment has its benefits, you pack and ship your own orders. Think about it, it’s cheap, easy, and quite flexible. If your company is just starting out, it makes perfect sense to do your own fulfillment. Many small ecommerce businesses handle their own packaging needs, shipping needs, they really have no use for a logistics partner.
It doesn’t matter what type of ecommerce business you have, if you’re struggling with cash flow, you should be handling your Shopify fulfillment in-house.
On the other end of the spectrum, if your Shopify stores are growing and you have cash on hand, outsourcing your fulfillment may be your path to reaching the next level. This is where a third-party warehousing and fulfillment company can help with your Shopify fulfillment.
There’s a number of different logistics companies that will store your product and take care of packing and shipping your orders. Here at Thill, we’ve been doing full scale fulfillment for 50+ years.
A lot of the business owners that reach out to us have never worked with a logistics company before. We understand it can be a little intimidating, but fear not. While we can’t speak for others, we know most logistics companies like Thill Inc. want the best for your company.
For those of you that are new to this, we’re going to cover everything, let’s start with fulfillment services.
What Are Fulfillment Services?
A fulfillment service is a third-party warehouse that prepares and ships your orders for you. Fulfillment companies do this from what is called a fulfillment center. Ecommerce fulfillment services are ideal for businesses that don’t want to deal with shipping or have outgrown existing warehousing capabilities to a point where your company can’t ship orders anymore.
As it pertains to Shopify fulfillment services, this type of fulfillment refers to a company that uses Shopify as their ecommerce platform. Our order management software at Thill is designed to easily integrate with your Shopify order fulfillment, so filling Shopify orders is simple and easy.
There are many larger third-party fulfillment providers, just like Thill Inc., who have strategically placed fulfillment centers in Reno, Nevada and Atlanta, Georgia. If you’re scaling fast and looking to optimize your fulfillment strategy, working with a provider that offers a central view of your data and smart inventory allocation across multiple warehouses will give you the most flexibility.
What Does A Fulfillment Center Do?
While it’s true that fulfillment centers operate in different ways, all of them are focused accomplish the same thing: they’re the command post for your order prepping and shipping needs. Fulfillment centers also double as warehouse spaces for inventory storage, allowing you to hold onto product.
Some fulfillment service providers like Thill Inc. have multiple fulfillment centers, this allows us to serve different geographical locations more efficiently. Since we have multiple fulfillment centers all across the United States, we can offer better shipping rates than most, plus save you money as your products are going to be closer to your customers.
What Do Fulfillment Services Cost?
We get a lot of questions about how much fulfillment services cost. In most scenarios, fulfillment services will typically charge you by the hour or per unit/pallet. 3PL fulfillment companies can also charge you for;
- Pick and Pack
- Receiving
- Returns Processing
- Shipping
- Kitting
- Custom Packaging
- Gift Services
- Storage Fees
- Transactional Fees
- Setup
Remember, costs for fulfillment services can differ from one 3PL company to the next. If you want to learn more about Thill Inc. fulfillment pricing, be sure to reach out here.
The Benefits Of Using Third-Party Logistics
One of the primary benefits of using a third-party logistics (3PL) company to outsource fulfillment is the fact that it removes you from the scenario of having to do your own fulfillment. If you’e moving a lot of product daily, doing your own fulfillment can be both time consuming and expensive.
In total, there’s a lot of pros to outsourcing warehousing and fulfillment, benefits that can have a huge impact on the growth of your business.
(1) Adding Fulfillment And Logistics Experts
When you hire an outsourced fulfillment services provider, the additional warehouse space is always a perk, but you also get an expert team that’s dedicated to operating the fulfillment center.
For those of you that are fulfilling and shipping your own orders, you already know how expensive it is to hire a team. If you’re growing and sales are up, you’re going to need more people to stay efficient. If your business is not seeing consistent growth in sales, you may be questioning hiring anyone. Needless to say, it can be challenging. Or you can go another route, you can outsource the work to a logistics company and let them be responsible for finding and hiring workers.
Each 3PL has a whole team of logistics experts and support staff who are there to help you along the way. Here at Thill Inc., we have over 50+ years of fulfillment experience. If you combine the experience we have in management, we’re talking hundreds of years of experience.
Together, we’re able to manage all of the labor you need for receiving, inventory management, and order processing and shipping—giving you a new level of agility you might not achieve so easily on your own.
(2) Focus Time Back On Growing Your Company
No business owner started their business because they enjoy picking, packing, and shipping product. You’re the decision maker of your company, your time and effort are precious to your business. Should you be focused on your Shopify fulfillment or should you be focused on the growth of your company?
Your time is better spent on managing and optimizing across the company, not weighed down in the logistics of order fulfillment. When you hire a fulfillment center to handle your logistical details, it allows you to focus the levers that will have the biggest impact on your bottom line.
(3) No Long-Term Leases
Many logistic companies do have flexible pricing. This means that as you grow, or go through slow periods, they’ll be able to adapt to your needs and adjust costs accordingly. Renting your own warehouse space usually requires more of a commitment, possibly one that you’re not ready to make at the moment.
If you do own or rent warehouse space, how big of an expense is it for you? Even if you’re not fully committed to finding a Shopify fulfillment partner, you should take the time to contact a 3PL company to see if you can save money. You already know time is going to be saved, if you have a fulfillment team, you can save on payroll or move those employees to other areas. To our point, it opens up the playbook for you to make the best decision for your company.
(4) Be More Flexible And Agile
Although self-fulfillment is cost-effective in the beginning, it can actually cost a lot in the long run. As consumers expect faster shipping times, doing your own in-house fulfillment can cause you to fall short on customer expectations and that can result in a bad customer experience. The last thing you want is bad customer reviews. It only takes a handful of negative reviews to have a major impact on your company, don’t wait until the last minute to get it fixed.
Partnering with a 3PL for outsourced fulfillment services, you can immediately begin benefitting from their efficient processes and leverage their buying power on packaging and shipping costs. Here at Thill Inc., our clients get real-time stock levels and status updates so they can always be on the offense.
By doing so, it allows you and your teams to focus on trying new strategies, inventory management techniques, and other initiatives to achieve rapid growth, so you don’t have to worry about back-end logistics or hiring backlogs.
Most companies start out fulfilling their own Shopify orders, and some eventually add a third-party solution as they scale their company. The big question, what’s the right time to switch? If you’re bootstrapping your Shopify business, how do you know when to pull the trigger?
Here’s the thing, Shopify businesses of all sizes can benefit from warehousing and fulfillment services. There are a variety of companies to choose from, some of these Shopify fulfillment companies do specialize in helping smaller or larger-scale operations.
When To Start Outsourcing Shopify Fulfillment
If you’re having a difficult time choosing, there are clear signs that it’s time to start outsourcing your Shopify fulfillment.
(1) Way To Busy To Deal With Fulfillment
If you’re so busy dealing with order fulfillment that you don’t have time to focus on growth, it’s probably time to start outsourcing it. As a business owner, you need to be able to devote time to sales and marketing, expanding to other ecommerce platforms, sourcing new products and ideas, and otherwise improving your business if you want to be around for the long term.
(2) You Have Up And Down Sales Through The Year
If the number of orders you process fluctuates throughout the year, it probably doesn’t make sense for you to commit to running and staffing your own warehouse. A logistics company will be able to adapt to your needs.
Likewise, unexpected spikes in sales—while great for your bottom line—can compromise your delivery promise. An expert can handle times when your daily order volume peaks so you can deliver a consistent and efficient experience every time.
That’s what happened to Elizabeth Grojean, founder of Baloo Living, a store that sells weighted blankets. After unplanned press coverage left her scrambling to fulfill orders, she used the Shopify Fulfillment Network to find a more reliable and adaptable solution.
(3) No Infrastructure In Place
If you’re growing geographically, you may outgrow your current infrastructure before you can adapt. Shipping to locations across the country or even the world poses logistical challenges that increase expenses and shipping times, among other things. This can hamper large-scale growth.
When you outsource to a global fulfillment partner, they’ll be better equipped to serve a growing customer base, leveraging multiple locations and optimizing fulfillment accordingly.
When You Shouldn’t Use A 3PL
Third-party warehousing and fulfillment isn’t the right solution for every business owner, but if you find yourself in one of these scenarios, there’s no harm to start calling around and chatting with logistics companies.
Truth be told, no one solution is perfect for every business. It’s all about making the right decision for your company. There’s going to be times when using a fulfillment services provider doesn’t make sense, no matter what size your business is. On the other end, a Shopify services provider can very well be your ticket to 7 figures, 8 figures, and beyond.
(1) Business Has Limited Cash Flow
Whether you’re a startup or not, if you don’t have the funds available, you may need to do it yourself. Sometimes your biggest resource is time, and you need to work with what you have.
In these cases, you might have to bootstrap business growth and use your own time as an investment, instead of paying employees or contractors.
(2) Highly Specialized Businesses
You may be surprised at the amount of customization many logistics companies offer—I certainly was. Still, not everyone will be able to find a company that can do what they want. If your business has highly specialized needs, it might make more sense to handle your fulfillment internally.
For example, a company that manufactures customized orders using specialized equipment might need to take the reins on their fulfillment processes. But for most other companies, third-party fulfillment services can be a huge time saver that also offers cost savings.
(3) Business Has Limited Daily Sales Volume
If you’re only doing a handful of orders a day, it’s likely too soon to consider outsourcing order fulfillment. At this stage, it’s still manageable in-house, either by yourself or an employee of your own. Once you hit five to 10 shipments a day, that’s when it’s time to begin your search for a 3PL.
What Does The Fulfillment Process Look Like?
Most business owners who manage order fulfillment in-house spend a significant amount of time managing staff, providing customer support, and generally overseeing the entire process.
But with outsourced fulfillment, the process looks pretty simple. In fact, all you really need to do is make sure your ecommerce fulfillment services provider has enough inventory. In many cases, your orders can be sent directly to your logistics company, and they’ll take care of packing and shipping the order.
If you run a Shopify store, the Shopify Fulfillment Network offers a dedicated network of fulfillment centers that ensure timely deliveries, lower shipping costs, and a positive customer experience. There are also several apps available to streamline your integration of third-party logistics.
Do They Help With Returns?
Many logistics companies can also solve order fulfillment problems on your behalf. This includes processing returns and issuing refunds.
In most cases, customers will send a return directly to the fulfillment center, where the company inspects it for damage and validates any customer feedback. Once that has passed protocol, the 3PL can then replace the product or issue a refund, meaning you never have to get involved. As long as the returned product is in good condition and can sale, they’ll restock the item and ship it once a new order is placed.
Do They Use Custom Packaging?
You’ve likely seen then on YouTube and other social platforms, we’re talking about the great “unboxing.” A great unboxing experience can be a solid point of differentiation. Customers feel more satisfied with their purchase and are more likely to buy again or recommend you to their friends.
Unfortunately, finding a great logistics company that will work with you on this can be challenging. Many logistics companies, especially the larger ones, force clients to use their rigid standards when it comes to packaging and other custom needs.
But many companies do offer this service. Even better, since warehousing and fulfillment companies have so much experience in this area, they may be able to make recommendations and help you save money on packaging.
With Thill Inc., you can integrate your customized packaging, add branding, design packing slips, and include custom packaging inserts, like stickers or samples, to surprise and delight your customers.
If custom packaging is important to you, make sure you ask potential companies about their options and willingness in this area.
How To Choose A Fulfillment Provider
If you want to hire an ecommerce fulfillment services company, the first thing you’ll probably do is head to Google. If you’re lucky, maybe you have a friend or colleague who can make a few recommendations. Now, how do you choose the right one?
(1) Industry Expertise Should Matter
More than anything, you want to find the right fit. Just like every ecommerce system functions a little bit differently, so does every fulfillment company. Many providers package their services to serve a niche of businesses in certain industries or types of business. There are a wealth of fulfillment companies out there—and each company has a unique focus.
(2) Similar Existing Clients
You should be looking for a Shopify logistics company that already works with companies similar to yours. This is a particularly good idea for ecommerce merchants who have their own sets of needs. You need a company that has experience fulfilling ecommerce orders.
For example, if you have a company that sells supplements, you would want a fulfillment center that does supplement fulfillment. That company will already have experience working with supplements, they’ll have an edge on competitors that haven’t fulfilled orders for a supplement business.
Another example, let’s say you have a subscription box business and need a fulfillment partner. In this case, you want to work with a company that has experience doing subscription box fulfillment. That 3PL will be familiar with fulfilling subscription box orders.
Experience in this area means not only that the company will be able to fulfill your orders accurately and in a timely manner, but they can provide strategic guidance and advice as you continue to work with your Shopify fulfillment partner. That company is going to be able to help you with hurdles and challenges because they understand ecommerce in those specialized niches. (You must choose the right partner though, choose wisely.)
(3) Don’t Get Caught Up On The Price
Price, price, price…. it always matters… right? Well, one of the most common shipping problems is always “cost.” We’re always talking about shipping costs, but it’s a big topic. If you can save on shipping costs, why wouldn’t you?
While it’s easy to look at the price tag and choose Shopify fulfillment services company based on price alone, you better consider more than just that. Many companies choose a provider based solely on price, they end up finding out you get what you pay for.
Price is important, we get that. However, finding a company that is a good fit is equally important. You don’t want unhappy customers, it only takes a few of them to cost you big time, only a few of them. You’d be better off going with a Shopify fulfillment center that will bring their A game day in, day out.
While you’ll should be considering multiple options and comparing rates, it should only be one of many factors in your decision. This is how you find the right fit partner.
(4) Technology And Integrations
Many ecommerce companies use a full tech stack, and you’ll want to find fulfillment services that can smoothly fit into that existing framework. When you sell on multiple ecommerce platforms, for example, those integrations are imperative for smooth logistics across all channels. This includes B2B wholesale channels and vendor management.
Some fulfillment services offer even more advanced tech features. Thill Inc. uses machine learning to provide recommendations for keeping your inventory close to customers in order to save time and shipping costs. And smart replenishment tells you which SKUs to restock at which fulfillment center based on sales, days on hand, and seasonal trends.
Here at Thill, our fulfillment software integrates with most popular ecommerce platforms. While you’re likely here because you have Shopify, we also have others to choose from.
- Amazon Ecommerce Integration
- Shopify Ecommerce Integration
- Magneto Ecommerce Integration
- Ebay Ecommerce Integration
Not only can you outsource your ecommerce fulfillment, but you can also free up your time so you can focus on other areas of your business. When you decide to outsource your fulfillment, you don’t have to worry about finding space for your inventory or hiring a big fulfillment team.
(5) Data And Analytics
Data is a powerful tool in ecommerce, and your Shopify fulfillment services are another data point that can tell you more about your business. Look for an option with real-time analytics tracking, so you can make informed decisions about inventory allocation, purchasing, and more.
Real-time analytics are powerful and needed, allowing you to make key business decisions as they’re needed.
(6) Do Your Due Diligence And Pick A Winner
Do your due diligence when searching for a logistics company. You don’t want to have to switch companies 2 months later. Take the time to check them out, talk with them, make sure they’re competent, and be certain you’re a good fit for each other. Check out the claims the company touts and speak with customer and trade references to make sure they’re legitimate.
This is especially important if you’re not sure about whether you’re ready to make the switch to third-party warehousing and fulfillment. As a potential customer, you can and should ask a lot of questions before choosing a company to work with. If it doesn’t feel like a good fit, don’t be afraid to walk away.
And as always, if you want to take to our fulfillment and warehousing experts, we’re just one call away. You can reach us at (920) 967-9201 or use this contact form.
