Why Startups Need Fulfillment Services
If you're like most startups, you're always looking for ways to cut costs and streamline operations. One area where you may be able to save money is by outsourcing your warehousing and fulfillment services.
By working with a third-party company, you can take advantage of their expertise and resources while freeing up time and manpower for other important tasks.
Below, we’ll explore how the right fulfillment solution can help your startup save time and money while delivering positive, memorable customer experiences.
What are Fulfillment Services?
We'll give it to you straight, order fulfillment services cover the entire process of fulfilling orders, from storing products in a warehouse to picking, packing, and shipping them out to customers.
From inventory management to last-mile delivery, these services can take care of every step in the fulfillment process so that you don’t have to.
Why Do Startups Use Fulfillment Companies?
The fulfillment industry is growing at a rapid rate. It was valued at over USD 85 million in 2021, and it’s expected to reach over USD 207 million by 2030. If you run an online store, this probably won’t surprise you.
For small businesses and startups in particular, fulfillment companies offer a very appealing solution to the often-complicated process of delivering products into the hands of customers.
Overseeing warehousing, inventory, and shipping requires significant investments (both in time and money), and a third-party provider offers economies of scale that a startup simply couldn’t achieve on its own. Then there’s the sheer hassle of running your own fulfillment operation. A fulfillment service removes that distraction, leaving you to focus on your core business.
The Benefits of Outsourced Fulfillment Services
There are many benefits of outsourced fulfillment services, including:
Freeing up Your Time
While you never forget the thrill of sending out your first order, it’s a thrill that can quickly wear off. Locating products, printing packing slips, and responding to customers’ delivery queries are all tasks that take time, and as your business starts to grow, it’s time that you can ill afford. Soon, you might well find yourself devoting so much time to fulfilling customer orders that you’re neglecting other business priorities.
When you outsource to a logistics company, you can put the cardboard boxes down and concentrate on the things that should be taking up your working days, such as product development, meeting investors, or marketing to customers.
Cutting Costs
Most small businesses start out by fulfilling orders themselves. Many things are actually cheaper to outsource in the longer term, and fulfillment is one of them. From leasing fulfillment centers to employing and training staff, not to mention the cost of packing materials, the bills for in-house fulfillment can quickly add up.
By working with a fulfillment company, you can benefit from their larger network and economies of scale at every step of the logistics process.
Accessing Flexible Warehouse Space
In the early days of a new business, customer demand can be a little unpredictable. So how do you know how much warehouse space to lease? Err on the side of caution and you won’t have enough room in the warehouse and might end up disappointing customers. If you’re over-optimistic, on the other hand, there’s the risk of entering into long-term contracts for space (and employees) that you don’t actually need.
Working with a fulfillment company gives you the flexibility to scale up or down as business requires without being tied down to a long lease or having to hire additional staff.
Reaching More Customers
Most startups don’t have several warehouses around the country – something that’s increasingly important in today’s market, where customers expect fast and affordable shipping no matter where they live.
This is where logistics companies can help you reach more customers. By tapping into their fulfillment network, you can house your products across a wider geographical area and deliver them to your customers faster.
Gaining Logistics Expertise
Sure, small business owners and startup leaders have more important things to do with their time than think about the minutiae of logistics. However, that doesn’t mean that fulfillment isn’t important. In fact, it plays a big part in meeting your customers’ expectations and growing your business.
The best fulfillment service providers are up to speed on industry best practices and the latest technological developments. They live and breathe logistics day in and day out, and you can benefit from their expertise to improve processes and please customers.
Improving Customer Satisfaction
If you have an online store, chances are you’re constantly looking to improve customer service. Ensuring a best-in-class delivery experience, whether that's faster shipping or same-day fulfillment, is one very effective way to go about this. The logistics infrastructure is developing so rapidly that it can be hard, if not impossible, for a startup ecommerce business to keep up with developments alone.
Working with a third-party fulfillment service gives you access to cutting-edge technology, from robotics for faster pick-and-pack services to apps that keep customers informed about the progress of their delivery so that you can delight them with every order.
What to Consider When Choosing a Fulfillment Service
Pricing
OK, this one’s important to every small business, particularly if cutting costs is one of the reasons why you’re looking to outsource. You’ll certainly want to think about your budget, flexible pricing (especially if sales are uneven throughout the year), and order minimums. Look for a transparent pricing structure with no hidden fees.
However, choosing a provider isn’t just a matter of going with the lowest quote. Finding a good fit – for example, a company that works with other businesses of a similar size to yours – can prove more cost-effective in the long run. The right solution will help you reach more customers, deliver exceptional service, and drive business growth.
Technology and Integration
Streamlining operations is one of the main benefits that a fulfillment service can bring, and technology has a big part to play here. Technology can help you fine-tune your business using data and analytics.
When it comes to inventory management, for example, there are systems that monitor your stock and alert you when you need to restock a product or when something is failing to sell. The best fulfillment services might also offer marketing tools and warehouse automation.
Product Specialization
Every industry or product has different fulfillment requirements. Food products or pharmaceuticals, for example, need to be stored (and transported) at a certain temperature, while fragile items like eyewear require careful handling. And when it comes to clothing, you’ll want to feel confident about picking the correct size and color. Maybe you require custom packaging or a fulfillment center that's familiar with subscription box fulfillment.
So when you’re looking to partner with a service, it’s important to look at their experience within your niche. Do they have clients in the same industry? Can they identify the challenges associated with storing and delivering your products? What solutions do they offer? How do they ensure success?
Warehouse Locations
One of the benefits of working with a fulfillment provider is the opportunity to expand your geographical reach. As well as asking about product and industry specialization, it’s important to understand how many warehouses a provider has and where they’re located.
Are their warehouse locations in the right place to offer next-day delivery to your current customer base? Do they have additional locations? Can you offer the same service to target customers in new regions?
All of these considerations help ensure you partner with the right provider to drive customer satisfaction and business success.
Logistics Services for Startups from A to Ziing
You’ve got more important things to do with your time – so why not outsource fulfillment and delivery to the experts?
At Ziing, we offer market-leading logistics services driven by technology to help startups delight their customers all the way to their front door.
Get in touch to find out how we can empower your startup with our flexible, cost-effective delivery and distribution solutions, and trust us when we say that with the right partner, it's a worthwhile investment.
