At Red Stag Fulfillment, it’s our honor to speak with thousands of eCommerce businesses and online sellers, foreign and domestic, who want to learn more about our order fulfillment and 3PL services. We are committed to helping eCommerce businesses in their search for long-term warehousing and fulfillment partners because we know firsthand how important it is to find the best fulfillment service for your eCommerce brand.
When you’re ready to move from an in-house fulfillment process to outsourced order fulfillment services, you want the best fulfillment service partner possible. However, there is no such thing as the single best company in the world — only the best fulfillment company for your needs. We believe every business should work with the best third-party logistics company to meet its needs, and if the search takes time and effort, it’s time well spent.
To get you started on your search, we’ve compiled this guide to the service offerings of some of the best fulfillment service companies in the U.S.
Finding the Best Fulfillment Company
Red Stag Fulfillment is a world-class fulfillment provider best known for shipping heavy, fragile, oversized, and high-value merchandise. This guide gives you an unbiased overview of several eCommerce fulfillment companies (including Red Stag Fulfillment), highlighting their areas of expertise and the fulfillment services they provide. Use it as a place to start your search for the best logistics services company for your business.
We’ve included details about five fulfillment companies, which all have different requirements and areas of expertise. We’ve included average parcel weights, fulfillment minimums, warehouse locations, and SKU breadth requirements for these logistics providers:
- eFulfillment Service
- Rakuten Super Logistics
- Red Stag Fulfillment
We hope this guide will help you find the best fulfillment service for your business. If you need more guidance to match you with the best order processing service for your business, please feel free to reach out to us. We are experts at helping eCommerce companies determine how best to meet their fulfillment needs, and we’d be happy to assist you on your journey to excellent order management.
3 Factors that Determine the Best Order Fulfillment Company for Your Business
When you start your search, you might think you simply need to find the best fulfillment service in the U.S. However, it’s almost impossible to quantify which is the best order fulfillment company. The right fit depends on the products you ship, the size of your business, and the special services you might need, such as kitting, labeling, inventory management, or returns management. In addition, consider the ease of connection between your 3PL and the eCommerce platforms you use for multichannel selling.
The best fulfillment provider for one eCommerce business might be the wrong choice for another. Before you start your search for your best fulfillment service, it’s helpful to get clear about your business operations. Here are three data points to quantify before you outsource your fulfillment.
1) Product Weight and Size
What are the physical attributes of the products your company sells?
Most of the eCommerce packages shipped today weigh less than 10 pounds. If you sell a lightweight product such as silk scarves, your average weight might be less than 1 pound. In that case, a fulfillment warehouse that specializes in shipping small orders is the best choice for you. If you sell heavy or bulky items, you need a different kind of fulfillment provider. You need one that knows how to safely store, pick, pack and ship larger orders.
Picking an eCommerce fulfillment services provider with experience in products similar to yours can have a significant impact on your bottom line. That warehouse will have warehouse space configured to work well for products similar to yours, leading to faster stocking and less shrinkage. It will stock the box sizes you need to ship your orders and offer shipping options that work well for the types of goods you sell, such as LTL freight for oversized products. This expertise can help you control fulfillment costs and improve your customer experience by increasing the accuracy of your order fulfillment.
2) Order Volume
How many packages do you ship per month?
For startups with low order volume, the best fulfillment service is one with no monthly minimums. If you ship a high volume of orders, the monthly minimum order requirements of a larger fulfillment operation could be an indication that these companies are well-equipped to manage your large order volume.
3) Inventory Breadth
How many unique SKUs do you sell?
The ratio of how many different items you sell to the number of orders you ship per month is called SKU breadth. Some fulfillment warehouses have a maximum SKU-to-order ratio. Even those without strict requirements may want to assess your SKU breadth. Stocking 150 different SKUs when you ship 100 orders a month might not be serving your business. The SKU breadth discussion is an opportunity to benefit from the wisdom of your 3PL and improve your inventory management.
Best Fulfillment Services by Parcel Weight
Rakuten Super Logistics and ShipMonk primarily ship packages that weigh between 1 and 10 pounds. ShipBob specializes in orders of 20 pounds and under. EFulfillment Service also handles smaller parcels, with package sizes limited to 36 inches or less. On the other hand, Red Stag Fulfillment specializes in heavy and bulky items. Red Stag Fulfillment’s expertise is primarily in shipping packages that weigh 5 pounds or more. This includes oversized and bulky items such as furniture and bikes, as well as high-value merchandise.
Order Volume Minimums
Monthly order minimums can be challenging for startups and small businesses. But, the more orders you ship each month, the bigger the discounts a fulfillment service provider can pass along to you.
eFulfillment Service and ShipMonk don’t have monthly order minimums. These fulfillment warehouses could be a great fit if you have a small business or your company is just getting off the ground.
ShipMonk has a monthly minimum pick and pack fee of $250.
ShipBob tends to work with companies that ship at least 200 orders per month. Red Stag Fulfillment works best for partners who are shipping hundreds to thousands of orders per month. Rakuten Super Logistics has a 1,000-order-per-month minimum.
Order minimums are not a judgment of your business. Consider them a good indicator of the strengths of each fulfillment company. Fulfillment centers with higher order minimums are positioned to work well with higher-volume sellers. Don’t assume, however, that a fulfillment provider that doesn’t have monthly minimums can’t handle a high volume of eCommerce orders.
If your business makes a smaller number of sales of high-dollar items each month, a company with a lower monthly minimum or no order minimum is a better choice. Your best fulfillment service is one that’s able to match the pace of your business effectively.
SKU Breadth Requirements
SKU breadth refers to the number of individual products your business sells. Generally speaking, the more SKUs you have, the greater the challenge of managing your inventory accurately. Be prepared to discuss the number of SKUs your business will need to add to your fulfillment company’s warehouse management system. This will help your potential fulfillment partner put together accurate pricing so you can determine if its fulfillment services are cost-effective for your product line.
SKU breadth is usually considered in relation to order volume. A business with a wide SKU breadth may need to ship a high number of packages each month to be attractive to a 3PL provider. Some of the order fulfillment providers reviewed here have specific ratios they’re looking for, while others take SKU breadth on a case-by-case basis.
ShipBob requires a SKU-to-order ratio of 5:1 or more. None of the other top eCommerce fulfillment companies have a SKU breadth requirement, but Rakuten Super Logistics and Red Stag Fulfillment will seek to understand the ratio of SKU breadth to order volume when onboarding a new client.
eFulfillment Service doesn’t consider SKU breadth. This order fulfillment company is a good solution for businesses with minimal order volume, independent of how many SKUs you sell.
SKU Breadth Explained
SKU breadth is easier to understand with an example. If you sell 100 different SKUs, you’d need to ship at least 500 orders per month to meet ShipBob’s 5:1 SKU breadth ratio. You don’t need to ship five orders from each SKU, just 500 orders overall.
There is an economy to selling higher quantities of fewer products, both for you and your 3PL provider. You get greater volume discounts on your products and also tie up less of your cash in inventory. For fulfillment providers, it’s typically easier to manage a smaller number of SKUs with a high turnover. An extensive range of SKUs that sell less frequently provides more of a storage and fulfillment challenge, and you might rack up storage fees that cut into your profit margins.
However, there are distinct advantages to having a wide product selection. It is a terrific way to attract more shoppers to your online store, since the lure of internet shopping is the ability to find precisely what you want. If your eCommerce shop has a broad selection, you’re more likely to keep customers interested and buying.
The trade-off between SKU breadth and sales volume is a balancing act for all businesses. For eCommerce sellers, it can affect your assessment of your best fulfillment service company.
Fulfillment Center Locations
Amazon continues to push the envelope on fast order delivery. Two-day delivery is the gold standard in the industry, thanks to Amazon Prime, but Amazon and more eCommerce businesses now offer one-day and even same-day shipping on select orders.
Amazon has a vast network of fulfillment centers across the U.S. If you sell on Amazon, Fulfillment by Amazon (FBA) can be an excellent fulfillment option. Amazon FBA gives you access to Prime shipping, which reaches more than 100 million Amazon Prime subscribers in the U.S. alone. That’s nearly one-third of the U.S. population who qualify for Prime shipping, so the reach of FBA is hard to beat for Amazon Marketplace sellers.
You don’t have to out-compete Amazon to run a successful eCommerce business, however. The best fulfillment service for your business might have one warehouse location or a dozen. It depends on your business model and your customer distribution; with outsourced fulfillment, you can choose warehouse locations that provide two-day shipping by ground transport to all or most of your customer base.
Strategic Warehouse Location
If you ship from multiple fulfillment warehouses, you’ll incur a cost to ship your goods to each warehouse location. On the other hand, the freight cost will likely be more than offset by what you and your customers save on order shipping. The fewer shipping zones each package travels through, the lower your shipping costs. Therefore, the closer your fulfillment warehouse is to your customers, the cheaper the cost of shipping.
If you offer free shipping, strategic warehouse locations can be crucial to your profitability. In addition, warehouse locations affect shipping time. Faster delivery times can be an incentive for your customers to place an order.
The best 3PL providers have a range of business models when it comes to warehouse locations. A small fulfillment network strategically located to deliver quickly to most of the contiguous U.S. states can be an effective way to keep inventory management simple while maximizing your reach. Other fulfillment solutions include more warehouse locations around the country or across the globe to be close to your customers. If you have a high order volume or do a lot of international shipping, look for a 3PL with warehouses where you need them.
Red Stag Fulfillment
Rakuten Super Logistics
Other considerations when choosing the best fulfillment company
The information in this post gives business owners a place to start with some of the best fulfillment service providers serving the U.S. There are several other things to think about when you’re choosing a logistics provider.
Ask these questions of yourself and potential order fulfillment providers:
- Do you need help with reverse logistics? If so, you’ll need a 3PL that handles returns.
- What shipping services does the warehouse connect with? After capacity challenges in recent years, it’s a good idea to have shipping options beyond the major carriers.
- Do you offer a subscription box or other grouped items that require kitting? Not all 3PLs offer kitting services, so make sure you choose one that can support your kitting needs.
- Does the fulfillment company support all your sales channels? Seamless connections between your shopping carts and the fulfillment center are essential for effective order processing.
- What level of order accuracy does the 3PL have? The best fulfillment companies will have error rates under 1% and a zero inventory shrinkage allowance.
- Can you get real-time visibility into your inventory? Dynamic inventory management is essential for success in today’s competitive eCommerce marketplace. Your 3PL should support your supply chain with frequent cycle counts and accurate inventory.
- What kind of customer support does your business need? Some eCommerce business owners want to set their fulfillment process up and then leave it to the professionals. Others want to be more involved, getting hands-on account management from their 3PL. Talk with prospective fulfillment service providers about the level of support you can expect.
- Do you need custom packaging? Work with a warehouse that can provide it in-house or connect directly with a resource for custom shipping boxes.
Fulfillment Company Questionnaire
Before there was Red Stag Fulfillment, there was a pair of frustrated eCommerce entrepreneurs struggling to find a fulfillment company with the level of service they needed to grow their businesses. So, they created a fulfillment company questionnaire. Each time they interviewed a potential fulfillment provider, they asked the questions on the questionnaire and recorded the answers.
In the end, the entrepreneurs couldn’t find a fulfillment service that met their high standards, so they decided to start their own. Fortunately, you don’t have to start your own fulfillment company to find a great fulfillment provider. Start with their questionnaire, and feel free to modify it to add questions specific to your business needs.
Outsourcing your fulfillment is an investment in the future of your eCommerce business. We hope this guide helps you in your search for the best fulfillment service for you.
More about the best fulfillment services:
- How Does RSF Achieve Such Low Fulfillment Error Rates?
- 2021 Fulfillment Report Card: How Would You Rate Your 3PL
- What’s Behind the Red Stag Fulfillment Guarantees?
Nothing in this article is meant to imply a legal relationship between Red Stag Fulfillment, LLC, and any company mentioned. Red Stag Fulfillment, LLC, does not own any other company’s trademarks referenced or included in this article. Information gathered for this article came from a mix of publicly available news and websites, websites of the companies mentioned, and direct communication with named companies.