Logistics news often focuses on coastal port delays and northern rail congestion, leaving out the reliability of central fulfillment operations that can reach your entire U.S. market. We think that overlooks some of the most significant potential time- and cost-saving opportunities for growing eCommerce business. So, this post will dive into central fulfillment locations and how they can be a core strategy for keeping customers happy and operations profitable.
Why do you need strategic central fulfillment locations?
Red Stag started with a central fulfillment location in the U.S. So, we’re a little partial to how great it is to do business here. But, if you need more reasons to consider central fulfillment centers, we’ve got those for you as well. The underlying theme is that these locations will make it easier for you to ship to customers quickly and affordably, while Red Stag can guarantee that orders are accurate too.
Here are the top five benefits of using a central fulfillment location as part of your distribution network.
Better crisis response
Adding a central fulfillment location to your broader distribution network helps protect you from a crisis. That’s true whether it’s a local power outage or something as substantial as COVID-19. Having multiple warehouses always helps by giving you ways to circumvent closures due to outbreaks and other health concerns. You have a backup if operations are ever considered non-essential or other local regulations cause a slowdown.
Having alternative fulfillment centers makes it much less likely that any event will halt all your operations.
Want to keep customers happy? Ship products to them faster. Customers want their goods faster than ever before, and offering that speed is a core competitive advantage. One way to ship faster is to have warehouses closer to your customers. A central fulfillment approach makes this simple, especially for large audiences in the Central U.S.
Most eCommerce companies prioritize warehouse locations on the coasts, making their Central U.S. coverage an afterthought. However, using a central eCommerce fulfillment location means you might be able to reach people in Chicago, St. Louis, and Memphis a day or more faster than your competitors.
With today’s advanced marketing tech, you can even target these shoppers as they search. Deliver an ad that highlights next-day shipping, and you can win that sale. Keep the profit by having a reliable partner that can meet on-time guarantees.
Lower fulfillment costs
Closer not only means faster, but in the world of shipping, it also means cheaper. You’ll save on last-mile fulfillment costs for orders in the Central U.S. when you’ve got a location nearby. That means fast access to roughly one-third of the population, which likely contains a large chunk of your audience.
Red Stag Fulfillment’s strategic central fulfillment location helps you afford those two-day and next-day shipping demands from today’s customers. Plus, we’ve got additional options to help you reach the coasts quickly.
Want to turn this into a marketable benefit for customers? Being closer, instead of shipping a package across the continental U.S., means fewer carbon emissions related to their order.
Improved customer satisfaction and reviews
Delivery is a core part of the modern customer experience. Turn fulfillment from a headache into an advantage by offering customers faster delivery from a nearby location. While you’re cutting costs, the customer gets a great experience and becomes more loyal to your business due to its reliable service. Satisfaction and repeat shopping are now as much a question of customer support as they are brand recognition.
People tend to read up to seven reviews of any product before they buy it. Purchase decisions now consider shipping speed and order accuracy in reviews. That’s partly because no one wants to figure out returns and replacements. The logistics impact of COVID means many aren’t willing to risk getting the wrong item or having to wait forever.
Red Stag’s national distribution network, including our central fulfillment location in Knoxville, helps us ensure that your orders go out on time and accurately. And when we deliver, you get all the credit from your adoring fans.
Reduced operational costs
If you’ve investigated a warehouse space in California, you know how expensive things are right now. And it’s only getting worse as companies gobble up more space during this eCommerce boom. Instead of paying these steep prices, cast your eyes toward central fulfillment locations. Here, real estate and taxes are lower, transportation is readily available, and a growing workforce. That means you free up more capital. Then, you can use it for more inventory, marketing, new products, or whatever your business may need.
While the savings on rent alone is worthwhile for many companies, we believe Knoxville and other locations in the Central U.S. offer the services, room for expansion, and the logistics experts that eCommerce companies need to grow.
Outsourcing to Red Stag and using our central fulfillment locations also means you’re cutting other operational expenses. We take care of securing space, building new facilities, hiring and training employees, scheduling pickups, and advanced options like creating space for kitting. You and your customers get world-class service that also boosts your bottom line.
Does central fulfillment offer new capabilities?
Expanding to world-class 3PL facilities, especially central fulfillment locations, gives your business access to the latest logistics best practices. These capabilities are chosen based on your products and business needs. So, you access what makes sense and don’t pay for capabilities you won’t use.
Central fulfillment strategies for the U.S. give us two significant options to consider. They’re designed to speed up your order fulfillment without creating bottlenecks or sacrificing accuracy.
1. Cross-docking solutions
A central fulfillment location positions your operations close to inbound freight channels, such as ports and airports. You’re closer to customers too. That setup means you have access to cross-docking capabilities, where product containers are unloaded from one truck at a receiving dock and then directly used to fill orders. Instead of storing them in the warehouse, they are immediately packed and put on another truck to get out to customers.
Cross-docking requires a significant amount of space near loading docks and complex inventory management platforms. You’ve got to know when goods are arriving and have a team utilize these SKUs immediately so that the last-mile carrier can be scheduled appropriately. We’ve found that a central fulfillment location makes this easier and has helped our customers better utilize products and tackle times of high backorders.
2. Direct injection points
Central U.S. supply chain locations can also give your company access to injection points that speed up regional delivery. An injection point is a location where orders are handed off to the last-mile carrier after they’ve left a fulfillment center. The 3PL doesn’t have a full pick and pack operation here, but it can work with carriers and distribute individual orders. Injection points can reduce your costs by having you pay for delivery from this handoff point instead of at the fulfillment center’s location or by giving you access to regional carriers with more competitive rates.
For example, a 3PL could pack multiple orders in Eastern Tennessee and drive their own truck — or pay a freight rate — to move these orders to Memphis. Each order is then handed off individually to the best carrier for delivery throughout the South and Southwest. You would pay last-mile fulfillment costs from that Memphis injection point — a reduction of roughly 400 miles and, typically, multiple shipping zones.
Central fulfillment makes it easier to reach everyone
The core reason businesses consider a central fulfillment strategy is reaching customers faster and more reliably. Positioning goods closer to customers keeps your costs down, while the strategy ensures you have multiple options to mitigate disaster risks. It all boils down to being an easier business decision. Centralized operations make business easier to manage, new and existing customers, forecast, predict budgets, and scale.
Plus, the Red Stag central fulfillment approach lets us reach 96% of the continental U.S. in two days or less.
Get your expert central fulfillment plan
So, the only question left is if you’re ready to learn how a central fulfillment strategy can benefit your business directly. What are the savings, speed improvements, and other benefits unique to you? Our experts would love to tell you, and it all starts when you click on the button below.