Providing a seamless online shopping experience is only half of the customer experience. Issues after checkout, such as order errors or slow shipping times, can ruin an otherwise flawless experience with your online store.
Fulfillment is a critical element of e-commerce, and a well-orchestrated and seamless process can save time, improve customer satisfaction and generate more revenue. But e-commerce fulfillment is not without its challenges and online retailers often struggle with fulfillment frustrations such as:
- Shipping costs.
- Shipping speed.
- Order accuracy.
- Software and integrations.
- Shopping cart abandonment.
- Returns and exchanges.
If your business is facing some–or all–of these challenges, an e-commerce fulfillment partner is likely the best and easiest solution for fulfillment.
1. Shipping Costs
Nearly 25% of e-commerce businesses say that shipping costs are their biggest fulfillment challenge. That’s not surprising, considering consumers expect free or low-cost shipping–and they want it delivered fast.
Shipping costs are also one of the main causes of shopping cart abandonment, making it extremely difficult for online retailers to remain competitive without draining money on shipping.
The obvious solutions to shipping cost issues aren’t exactly ideal:
- Increase product prices to cover costs for shipping. In this case, the customer pays.
- Increase product prices to cover half the costs of shipping. In this case, both parties pay.
- Pay the full price of shipping for customers. In this case, you pay.
A fulfillment partner is likely going to be your best bet for reducing shipping costs while remaining competitive. They can find or create the most efficient and cost-effective shipping solution for your business needs, thanks to their relationships with carriers and access to global distribution networks. They can also assist with optimizing packaging to reduce costs further.
2. Shipping Speed
Online shoppers don’t expect shipping at the speed of Amazon from smaller online retailers. However, they do expect to receive their purchases within a reasonable timeframe. If your delivery timeframe is three or five days longer than the competition, they’ll likely abandon their cart or shop elsewhere.
An e-commerce fulfillment partner has the technology, infrastructure, processes and staff in place to fulfill orders as quickly (and accurately) as possible. From highly regimented processes that expedite the pick and pack process to having multiple warehouse locations in strategic locations, a fulfillment partner can drastically expedite delivery times.
3. Order Accuracy
Order accuracy is a critical metric that online retailers should continuously monitor and strive to improve. To calculate your order accuracy rate, divide the total number of orders you’ve fulfilled correctly by the total number of orders fulfilled. Then, multiply that number by 100.
For example, if you’ve fulfilled 500 orders, but 50 of them were incorrect, then your order accuracy rate is 90% (i.e. 500 - 50 = 450 / 500 x 100 = 90%).
While reaching 100% is not always realistic, you should aim for an order accuracy rate of 98% or higher since it has a direct impact on customer satisfaction.
If you notice your order accuracy rate lowers as your business scales, it might be time to outsource fulfillment. A fulfillment partner is well-versed in QA and has extensive processes in place to ensure order accuracy.
4. Software and Integrations
There’s a lot going on behind the scenes of your online store. Unfortunately, not every e-commerce platform integrates directly with fulfillment software, making it difficult to track orders, manage inventory levels and have oversight of supply chain operations.
If you’re using a complex set of systems, it can slow down the time it takes to fulfill orders, frustrating both employees and customers. Some challenges you may experience include:
- Inconsistent data flow between processes and systems.
- Limited reporting capabilities.
- Time-consuming and labor-intensive operations due to manual data entry and transfer.
- Poor handling of inventory, resulting in inaccurate forecasts.
- Inaccurate customer information.
Finding a fulfillment partner that can integrate disparate storefronts and systems is essential for your success. Additionally, since no two e-commerce businesses have the same needs, a fulfillment partner can create specialty integrations upon request to ensure a seamless flow of information.
5. Shopping Cart Abandonment
The average shopping cart abandonment rate is around 70%. This percentage can be painful to think about when you consider how much revenue was left in abandoned carts. The main reason for shopping cart abandonment comes down to shipping-related issues such as high fees, slow delivery times or limited delivery options, such as international shipping.
Partnering with an e-commerce fulfillment company can help reduce shipping costs and expedite delivery times and is essential for retailers looking to ship internationally.
6. Returns and Exchanges
The average return rate for online purchases is around 25% and, while returns can be costly, it’s an important service to provide for customers. In fact, free returns and exchanges are cited as the number two reason consumers are more likely to shop online. If your return policy is working against you rather than for you, it may be time to reevaluate your processes.
Instead of having items sit in storage after a return is made, quickly restock those items for resale. Failure to do so will throw off inventory levels, making it difficult to know what is and isn’t available.
If you’re a small- to medium-sized e-commerce business, you may have one or two people handling returns. But that approach isn’t scalable as your sales volume increases. You need a team in place to handle returns and restocks.
An experienced fulfillment partner can help you find a return policy that works for you and your customers. When evaluating your options, look for a partner that has the infrastructure in place to handle a high volume of returns quickly.
Eliminate Fulfillment Challenges with GLF
With 20 years of experience in e-commerce fulfillment, GLF takes pride in offering transparent pricing, unmatched reliability and personalized services.
GLF’s e-commerce fulfillment experts are here to help create customized solutions for all of your fulfillment needs. Take our free online assessment to learn how outsourcing fulfillment to GLF can benefit your business.
Editor’s Note: This blog was originally published in June of 2021 but has been updated to reflect current information.