For most people, the holidays are a time for family and fun and maybe one party too many. If you are an ecommerce seller, your holiday season is probably hectic as well as full of good cheer. After all, there’s nothing like making enough money to start your New Year in the black to put you in a good mood. The last thing you need is a fulfillment center that throws a Grinch into your holidays.
The test of any fulfillment center is how well it serves its clients during the busiest sales months of the year. Here are 5 things for ecommerce sellers to think about when choosing a fulfillment center, to ensure that your holidays are merry – and profitable.
1. Fulfillment Center Holiday Staffing
You most likely started preparing for your Christmas rush in the spring or summer. You have inventory lined up, production scheduled, promotions set to fire off at the right time. You may even have added staff to help process holiday orders. But has your fulfillment center?
If you’ve been operating your ecommerce shop for a few years, you probably have a pretty good idea of the cyclical nature of your sales. Your sales history gives you an idea how much inventory you need to have on hand to cover your holiday orders. You’ve planned to have just the right amount of product: enough to fill every possible order but not so much that you will have a lot of inventory left at the end of the year. Barring an unexpected viral shopping hit (and wouldn’t that be a nice problem to have), your inventory is ready to flow out to your fulfillment center right on schedule.
If the fulfillment center hasn’t added the capacity it needs to process the surge in orders, however, your perfect planning could go to waste.
Your insights about your business can help your fulfillment center serve you better. Do your weekly sales numbers double or triple in late November? Is your biggest spike usually around December 15? A top notch fulfillment center will want to know what to expect from your business and will make a plan to have enough staff on hand to process orders on the critical days for ecommerce holiday shipping.
Ask your fulfillment center for an order processing guarantee to ensure they will have the staff they need to pack and ship your holiday orders quickly. There’s nothing merrier than orders flying out the door as fast as they come in.
2. Fulfillment Center Holiday Space Crunch
You have calculated the ship dates that will get your products to your fulfillment center in time to be ready as your orders come pouring in. But does your fulfillment center have space to accommodate the extra merchandise?
As customers of Amazon FBA know all too well, when everyone wants to pile on more inventory in the 4th quarter, fulfillment centers can run out of space to store all that merchandise. Some, like Amazon, place limits on storage space or raise storage fees during the holiday season.
A shelf space shortage at your fulfillment center could leave your products sitting in pallets on the loading dock when they should be picked, packed, and shipped. Ask your fulfillment center for a dock-to-stock time guarantee to make sure not a single order is delayed because of warehouse stocking backlogs.
After all, fulfillment center shelves chock full of your inventory and ready to ship to customers anywhere from Juneau to Johannesburg warms ecommerce sellers’ hearts more than a frothy mug of eggnog.
3. Fulfillment Center Inventory Accuracy
Your products may get off the pallets and onto the fulfillment center shelves, but if your fulfillment center inventory isn’t accurate, you could still lose out on sales. There’s nothing worse than a lonely 230-piece standard and metric silver finish mechanic’s tool set or a silver tone mermaid pendant necklace on a 14-inch chain sitting unrecognized on the warehouse shelf while your customer gets an out-of-stock message.
Merchandise that doesn’t make it into the fulfillment center inventory system might as well be lost. Ask your fulfillment center for an inventory accuracy guarantee, to make sure that every piece of merchandise you forward for fulfillment counts.
As ecommerce sellers know, nothing makes a Christmas elf happier than each and every gift getting shipped off to a new home.
4. Fulfillment Center Inventory Shrinkage
Most fulfillment center contracts allow for inventory shrinkage of up to three percent. This means that the fulfillment warehouse can lose, break, or misplace up to three items for every 100 you send to them. During the holidays, when there is so little margin for error, that shrinkage can hurt your bottom line and lose you not only sales but customers.
To make your holidays happy, look for a 3PL provider with a shrinkage allowance of zero, zip, zilch – one that guarantees that every item you send to fulfillment center will make its way into inventory and out to your customers. (Hint: Red Stag has just such a guarantee for its fulfillment center clients.)
5. Fulfillment Provider Accountability
No one is perfect. You make mistakes, your vendors make mistakes, and your customers would make mistakes, if the customer wasn’t always right (even when they’re wrong). A good business relationship means giving each other some latitude, catching errors quickly, and correcting them just as fast.
During your busy Christmas season, however, mistakes can be costly. Your customers need their orders to arrive both accurate and on time.
How much margin for error can you give your fulfillment center? Each error will cost you extra customer service time, as you soothe the frazzled nerves of Delores in Des Moines who got the red one when she ordered the green one or Peter in Portland who ordered a small and got a large or – worst of all – Simone in St. Louis whose package didn’t arrive at all.
A fulfillment center that compensates you for every late shipment, mis-pick, or incorrectly labeled package is a 3PL provider with a strong incentive to get it right for you every time. That’s why Red Stag pays you for every mistake it makes, so our managers and team leaders take your orders as seriously as you do.
No one is perfect. But a fulfillment center with accuracy in picking and packing that exceeds industry standards can go a long way toward making your holidays merry and bright.
This Christmas, may every click in the buy box at your online store end with money in your pocket and a happy customer who will buy from you again. A great fulfillment center is your best partner to make this happen.