7 Reasons to Outsource Inventory Fulfillment to a 3PL
Sometimes things just work. In the world of an entrepreneur, such is the case when you start your own ecommerce business, orders swiftly start flowing in, customers rave about your awesome products, and you grow by the day. But there’s one big problem with that success. You outgrow your in-house fulfillment setup pretty quickly.
Outsourcing inventory and order fulfillment to an experienced 3PL is the natural next step for a growing business. Still, it can be difficult to determine when it’s time to make the switch to greener pastures. We’re here to help you understand if you’re at that point now. Keep reading to see if outsourcing is right for you with this definitive 7-point checklist!
#1 You’re Running Out of Space
It goes without saying that you can’t manage a full-fledged fulfillment center out of your living room. Or your bedroom. Or your garage. In fact, regardless of how big your house is, running out of space is not a matter of if, but when for the successful entrepreneur. You want that to happen; it means you’re killing this ecommerce game. Leveling up from your home to a warehouse where you rent space could be the next step for you. However, as you grow, your warehouses have to grow with you.
With those increased space requirements comes higher costs in moving fees, rent, staffing, and more. Those are a lot of costs going up as your ecommerce business goes up. So, while it may initially seem counterintuitive, letting a 3PL handle the logistics of your spatial needs from the beginning is an excellent way to save your company money and stress from early on.
And anyway, wouldn’t it just make your life so much easier if the place you kept your inventory actually, you know, shipped it out when orders come in? Hence the importance of a fulfillment center vs. warehouse for a growing ecommerce business.
#2 You Have High-Ticket Items or Need Additional Safekeeping
Watches, jewelry, electronic gadgets—it’s never a good idea to have an expensive item lying around the house where it can be susceptible to things like water damage, rabid dust bunnies, and a curious pooch with a penchant for shiny objects.
But it’s not just about individual cost; even if your products are on the lower end of the price spectrum, lost or damaged $5-dollar t-shirts can quickly add up if you have a lot of them detracting from your bottom line. 3PLs will usually have cameras and other forms of safe storage solution. For example, in addition to standard security and careful storage areas throughout our fulfillment centers, ShipMonk has certain facilities with dedicated, secure spaces and teams for high-ticket items.
#3 You’re Having a Hard Time Managing Your Inventory
Even if you and your employees shine with entrepreneurial brilliance, a lack of in-house automation, quality control checkpoints, and scanning capabilities can spell disaster for accurate inventory counts and keeping track of items that have been shipped, delivered, damaged, or even returned. And if we’re talking demand forecasting, let’s just say that the complexity there lends well to having an order fulfillment partner by your side.
Inventory outsourcing to a 3PL fulfillment center removes all the guesswork. A 3PL like ShipMonk that has advanced inventory management software eliminates human error from the equation and allows you to manage stock levels from anywhere—like, for instance, a couch that’s not littered with bubble wrap and packing paper.
At a glance, ShipMonk’s order and inventory management software can help you deal with problems like:
- Uncertain stock of your SKUs
- Upset customers due to canceled or delayed orders
- Unexpected backorders and stockouts
- Uncertainty with inventory forecasting
#4 You Need to Fulfill B2B Orders or Do FBA Prep
If you’re committed to scaling your ecommerce business, chances are that you’ve already explored selling your products on Amazon and in brick-and-mortar stores. While both are commendable moves, they do require some extra steps on your end to ensure that each shipment meets individual guidelines.
Figuring out every single thing you need to do to make this happen can be hard to do on your own. After all, who has the time to palletize and assemble inventory according to Amazon’s exacting specifications? A 3PL can take care of prepping and shipping in a snap, helping you save money and time, which you can dedicate to other areas of your ecommerce business.
#5 You Have to Deal with Returns
Unfortunately, as much as they may be a hassle, returns are pretty much unavoidable when you run any kind of business; and with ecommerce businesses they can be even more common, especially if you’re in the apparel industry. That’s why having a well-oiled process for processing returns is crucial for delivering top-notch customer service and minimizing revenue loss.
A 3PL worth their salt will work with you to make the return process as smooth as possible and customize it for your unique needs. Your customers can send their returned items back to a fulfillment center and you have complete control over whether that inventory gets donated, reshelved for resale, or discarded. In ShipMonk’s case, we even have a post-purchase suite that can minimize hours spent handling these tasks, streamlining and branding the process.
#6 Your Post-Office Trips Are Getting Out of Hand (Literally)
They say the quickest way to a shipping carrier’s heart is by fulfilling orders in-house. Well, they don’t actually say that, but in-house fulfillment does guarantee a very close working relationship with your nearest USPS, UPS, or FedEx. And while that’s great and all, schlepping orders all day and dealing with long lines is time-consuming and not very sustainable.
You know what is sustainable? The shipping solutions you attain by inventory outsourcing! Established 3PLs like ShipMonk have strong relationships with all the major shipping carriers, and offer a variety of shipping services ranging from less expensive economy ground to speedy 2-day shipping. We also offer a Virtual Carrier Network that combines all the best parts of rate shopping with transportation methods and other key elements to always be adapting to find you the best price to accomplish your shipping goals. In sum, by outsourcing your inventory order fulfillment to our 3PL, you’ll live in a world where you go to the post office to send birthday gifts or holiday cards, not orders for your ecommerce business.
#7 You Need More than Just Inventory Outsourcing
The truth is that if you’re running into problems with your inventory you’re likely experiencing strain in other areas of your ecommerce business. At the very least, you may be dealing with a serious case of burnout as you try to balance inventory management, order management, and warehouse management, along with every other aspect of being an entrepreneur. That alone is enough of a reason to consider passing the baton.
When you do, you’ll be able to focus on the best parts of being an ecommerce business owner, like producing cool new products and getting creative with your marketing strategy. In other words, if you need help in more than one area of fulfillment, you need a fulfillment center that can deliver.
Time to Recenter Your Ecommerce Business with a Fulfillment Center
If you found yourself nodding along to these pain points, recognizing your own ecommerce business issues that need alleviating, it’s probably time for inventory outsourcing. And if not, then keep an eye out. You don’t want to inhibit your company’s growth out the gate by not being set up for maximum success and scaling.
If you’re ready to take your ecommerce business to new heights, ShipMonk is here to help! Contact us today so you can stress less and grow more.