As an eBay seller, your business is dependent on near-perfect seller ratings. Great eBay fulfillment operations are key to running your eBay business profitably and keeping your customers happy. Fast and accurate shipping are one of the best ways to get positive feedback.
When you started out on eBay, you probably shipped all your orders yourself. Over time, your eBay business has expanded. Now, you might wonder if it’s time to use a fulfillment warehouse to pack and ship your eBay orders.
You need to handle your eBay fulfillment like a pro as your business grows. For more and more eBay sellers, that means outsourcing their fulfillment.
To Outsource or Not to Outsource?
If you sell used auto parts on eBay, you never know what new treasure you will find at the wrecking yard. Your product assortment and stock will vary from week to week. You want to connect your eBay customers with the parts they need and keep your prices low. To do that, you might need to handle your own fulfillment. Resale of used products is a terrific way to make money on eBay. However, this business model doesn’t lend itself to standardized shipping boxes and restockable SKUs. Some third-party fulfillment services specialize in working with eBay resellers. However, most fulfillment warehouses need repeat sales of the same products to operate efficiently.
On the other hand, if you sell new auto parts on eBay, a 3PL provider can be a huge asset to your business. Outsourcing your order fulfillment frees up your time. You can use that time to source your products at better prices. Or you might find suppliers for some hard-to-find replacement parts.
Here are some factors to consider when you evaluate whether to outsource your eBay fulfillment.
What’s the best use of your time?
Packing and shipping orders can eat into time you should be spending on product development or marketing. You could actually lose money by keeping your fulfillment in-house.
Do you have the staff you need for fulfillment?
You might be able to rope your spouse and kids into helping you ship orders in the evenings. At the end of the day, however, it’s your responsibility to ship your eBay orders. If it’s too much for you to handle, that’s great; it means your business is thriving. A third-party fulfillment provider will support the growth of your business. As a bonus, you get a break from supervising reluctant teenagers. The professionals will do a better job, too.
Would you like more freedom to travel while still making money on eBay?
The beauty of an eBay business is that you can work from anywhere. You might live somewhere wild and beautiful, but your home base may not be the best location for eBay fulfillment. When you outsource your fulfillment, choose a centrally-located fulfillment warehouse. This will reduce your shipping costs and delivery time.
Are you losing money by doing your own fulfillment?
The fees charged by the fulfillment warehouse are an added business expense. However, the costs is likely to be more than offset by what you save over renting your own storage space. Fulfillment centers occupy large warehouses. That mean they can negotiate a lower rate per square foot. So, the storage rate you pay for space with a 3PL provider could be less than the cost of your own space.
Is your inventory at risk?
If you store your products in a shed in your back yard, the cost is low, but the risks are high. Professional eBay fulfillment can save your merchandise from flood waters, nesting mice, and leaky roofs.
Do you need varying amounts of warehouse space?
The amount of space you rent at a third-party fulfillment provider is flexible. You can use more shelf space in your busy season. The you can shrink your footprint (and save on costs) when sales cool down. Outsourcing your eBay fulfillment gives you flexible overhead.
What is the error rate on your eBay fulfillment?
Fulfillment errors can sink your eBay business and keep you occupied dealing with customer service headaches. Mis-packed orders, shipments that arrive damaged, or orders sent to the wrong address mean angry customers. These are errors that can drag down your seller rating. A fulfillment center does nothing but focus on excellence in packing and shipping orders, so they do it right. Outsourcing your eBay fulfillment is a can reduce your error rates.
What is fulfillment costing you?
Your time is valuable. While you may not pay yourself by the hour, you should account for your time. Add up the time that you spend picking and packing orders or supervising others to do it for you. How much could your business grow if you outsourced your fulfillment?
Why Third-Party Fulfillment May Be the Answer to Your eBay Fulfillment Needs
There are many benefits to outsourcing your eBay fulfillment. Here are just a few.
In an ideal world, you would ship each item you sell on eBay as soon as the sale is complete. In the real world, a million things can get in the way. The baby needed to go to the doctor or your water heater broke. Perhaps you got hit with the latest virus and couldn’t drag yourself out of bed. When you use a fulfillment center, you eliminate the unexpected delays that come when life gets in the way. Your orders will ship without interruption while you find out if the baby swallowed a penny. When you hand off your fulfillment to the professionals, your business will run more efficiently.
Faster and Less Expensive Shipping
A centrally-located fulfillment center can get your packages to most people in the US in two days or less. In addition, since fulfillment centers are bulk shippers, they can often negotiate lower shipping rates. Your eBay fulfillment provider could pass on those savings to you. More accurate picking and packing can lead to fewer returns. Returns cost you money, so that’s more savings.
Boost Seller Rating
One easy way for eBay sellers to earn negative feedback is slow shipping. Samantha in San Diego is breathlessly waiting for her new iPhone cover. If it arrives late, she will be very irritated with you. She may even be cranky enough to describe her negative experience and warn other shoppers to stay away.
Your eBay fulfillment center can help you communicate with buyers about shipping times. This is a great way to manage expectations and keep them updated on unexpected delays. It’s even better if their order arrives quickly with no extra hassles. A fulfillment warehouse can make all of that happen.
The employees at 3PL providers pick and pack shipments all day, every day. Fulfillment warehouses have systems in place to ensure accuracy. Your customer’s order can go out the day after your customer makes the purchase (and many times the same day).
Imagine Samantha’s joy when her Justin Bieber phone case arrives in time to take to school on Monday. She’s sure to give you positive feedback.
Lower Return Rates
A generous return policy is a must for online sales. In fact, 40% of online shoppers report buying multiple products with a plan to return some of them.
Statistics on eCommerce return rates vary widely. One survey showed an overall return rate of 30% for eCommerce sales, versus 8.89% in brick-and-mortar retail. Another study found that 75% of eCommerce buyers make at least one return per year.
eBay is a different kind of shopping site. As an eBay seller, you have to work harder to make sure your customers are satisfied with their orders. A third-party fulfillment provider can be a valuable partner in reducing eBay returns.
In 2016, eBay added return rate statistics to seller dashboards. eBay initially said that the metric was there for information only. However, there have been reports of sellers being removed from eBay or losing their TRS status over returns. This has happened with return rates that would be considered low on other platforms.
On eBay, a return rate of 5% or less is crucial. Sellers can accomplish this with clear product descriptions (so buyers know exactly what they are purchasing) and accurate fulfillment.
Since returns have become an important metric for eBay sellers, the value of expert fulfillment is greater than ever. An order that is properly packed is less likely to arrive damaged. Fulfillment professionals can help ensure that every buyer gets exactly what he or she ordered.
Your eBay rating can’t afford the 4% mis-pick rate that’s the average for fulfillment centers. At Red Stag, our error rate is so small (0.0001%), we need extra decimal points to get it to show up at all.
Choosing the Right Partner for your eBay Fulfillment Center
The eBay platform is all about communication. Sellers and buyers can talk to each other throughout the purchasing and shipping process. This may cause some eBay sellers to hesitate to outsource their fulfillment. When you have your hands on your own stock, you can let your customers know exactly what’s happening with each order.
As your eBay business grows, however, self-fulfillment can become more of a liability than an asset. It’s easy to miss something when you’re juggling customer emails with one hand and sealing packages with the other. The time you spend communicating with your customers is the key to keeping your seller rating high. A top-notch third-party fulfillment provider will free you to be a better eBay seller.
Choose a Company That Ships Products Like Yours
Are you shipping many small orders or a few big ones? Do your customers order multiple items that might sell better if they were kitted? Do you sell heavy or fragile items that need to be packed carefully to avoid damage in transit? Are your products perishable? Not all order fulfillment warehouses are the same. Ask what kinds of products a fulfillment warehouse specializes in. Then, choose a 3PL provider with expertise in handling products just like yours.
Choose an Experienced and Reputable Fulfillment Provider
It’s okay to ask for references from your potential future order fulfillment partner. Find out what their current customers say about working with them. Ask them for data on shrinkage, error rates, and holiday delays. Find out what guarantees the fulfillment center offers. How long will it take to move your stock from receiving dock to stock shelf? (Hint: this should be no more than 48 hours.)
Choose a Partner that Will Grow Your Business
The right fulfillment warehouse can be a great partner for eBay seller success. Your 3PL provider will make sure your orders get into your customers’ hands quickly and accurately. This lets you focus your resources on growing your sales on eBay. Choose a fulfillment center that will help you find optimal stocking levels and improve product turnover.
Choose a 3PL Provider that Offers a Wide Range of Shipping Solutions
Check which shipping solutions the third-party fulfillment provider offers. Choose a partner that works with a number of different freight companies. This allows you to offer your customers the shipping choices they want.
Choose an eBay Fulfillment Partner that Provides Seamless Integration
Make sure you choose an eBay fulfillment warehouse that communicates with you. This will allow you to tell your customers when to expect their orders. In addition, you can keep them informed of any shipping glitches. You should be able to see the status of every order. That allows you to answer buyer questions quickly. The systems at your third-party fulfillment center should seamlessly integrate with your eBay store. They should also integrate with any other platforms where you sell. Full and seamless integration means no delay in processing orders.
Fulfillment by eBay
eBay has been trying out new programs to improve customer experience, including eBay Plus. The program is similar to Amazon Prime. It offers free shipping on qualified items for an annual fee. At the moment, eBay Plus is only available in Australia and Germany. The program isn’t yet available to US sellers but may be in the future.
eBay has a pilot program called Fulfillment by eBay. Like Fulfillment by Amazon, the eBay service takes care of storage and shipping. Unlike Amazon, eBay is not shipping from its own warehouses. Instead, the platform subcontracts with fulfillment centers.
If Fulfillment by eBay becomes widely available, it’s an option to consider. The easy and fast shipping could make your products more attractive to buyers. And eBay’s bargaining power could lead to lower rates for fulfillment services.
If you started your own eBay business, you’re probably a take-charge, DIY kind of person. As your eBay business grows, however, outsourcing your storage and shipping will help you operate more efficiently. Outsourced fulfillment can increase your profits, seller ratings, and time off.
It’s easy to become overwhelmed by the work of running your eBay store. When shipping your orders is taking most of your time, you need to outsource your eBay fulfillment processes. When you run out of space to organize and store your products, think about outsourcing. Third-party eBay fulfillment is a more flexible and cheaper solution than renting more warehouse space. When you absolutely have to get your return rates below 5%, a fulfillment warehouse can help. A great fulfillment center can boost your seller rating and your eBay sales.
If you still have questions about eBay fulfillment, we’re here to help. Contact us for a free fulfillment consultation.