As an eBay seller, your business is dependent on near-perfect seller ratings. One of the best ways to get positive customer feedback on eBay (and most other eCommerce platforms) is fast and accurate shipping. Great eBay fulfillment operations are key to running your eBay business profitably and keeping your customers happy.
When you started out on eBay, you probably shipped all your orders yourself. As your eBay business has expanded, you might be wondering if it’s time to use a fulfillment warehouse to pack and ship your eBay orders. You’ll 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. To connect your eBay customers with just the parts they need and keep your prices low, you might need to handle your own fulfillment. Resale of used products is a terrific way to make money on eBay, but this business model doesn’t lend itself to the standardized shipping boxes and restockable SKUs that make third-party fulfillment centers hum.
On the other hand, if you sell new auto parts on eBay, an order fulfillment center or 3PL provider can be a huge asset to your business. Outsourcing your fulfillment can free up your time to source your products at better prices or find suppliers for hard-to-find replacement parts.
When you evaluate whether to outsource your eBay fulfillment, here are some factors to consider.
- What’s the best use of your time? If packing and shipping orders is eating into time you should be spending on product development or market expansion, you could actually lose money by keeping your fulfillment inhouse.
- 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, the responsibility to fulfill your eBay orders quickly and accurately falls squarely on your shoulders. If it’s too much for you to handle, that’s great; it means your business is thriving. A third-party fulfillment company will support the growth of your business and save you from supervising reluctant teenagers. The professionals will do a better job, too.
- 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.
- The fees charged by the fulfillment warehouse are an expense for your business, but this is likely to be more than offset by what you save over renting your own storage space. Since the fulfillment center occupies a much larger space, they pay less per square foot, so the storage rate you pay for their space is likely to be less than what you would pay for your own space.
- If you store your products in a shed in your back yard, the cost is low, but the risks are high. A professionally-run eBay fulfillment warehouse can save your merchandise from flood waters, nesting mice, and leaky roofs.
- The amount of space you rent at a third-party fulfillment provider is flexible. You can ship more products in your busy season and shrink your shelf space (and save on costs) when sales cool down. Outsourcing your fulfillment can allow you to grow your business without adding much to your overhead.
- 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 are all mistakes that can drag down your seller rating. Outsourcing to a professional third-party fulfillment provider, a company that does nothing but focus on excellence in packing and shipping orders, is a great way to reduce your error rates.
- Your time is valuable. While you may not pay yourself by the hour, you should also factor in the time that you would have spent picking and packing orders or supervising others to do it for you.
Why Third-Party Fulfillment Can be the Answer to Your eBay Fulfillment Needs
Save Time and Money
In an ideal world, you would ship each item you sell on eBay as soon as the sale is complete. In the real world, the baby needed to go to the doctor, your water heater broke, or you got hit with the latest virus and couldn’t drag yourself out of bed. When you use a fulfillment center to ship your eBay orders, you eliminate the unexpected delays that come when life gets in the way. Your products can ship without disruption while you find out whether the baby swallowed a penny.
You’ll save money, too. A well-placed fulfillment center may be able to offer you lower shipping rates. More accurate picking and packing can lead to fewer returns – returns that cost you money. When you hand off your fulfillment to the professionals, your business will run more efficiently.
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 give you one star, describe her negative experience, and warn other eBay shoppers to stay away.
Communicating with buyers about shipping times is a great way to manage their expectations and keep them updated on any 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. With systems in place for accurate orders, your customer’s order can go out within a day of when your 3PL provider receives it (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 percent 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 percent for eCommerce sales, versus 8.89 percent in brick-and-mortar retail. Another study found that 75 percent 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. While eBay initially said that the metric was there for information only, there are reports of sellers being removed from eBay or losing their TRS status for return rates that would be considered low on other platforms.
On eBay, a return rate of 5 percent 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 percent mis-pick rate that’s the average for fulfillment centers. At Red Stag, our error rate is so small (0.0001 percent), we need extra decimal points to get it to show up at all.
Choosing the Right eBay Fulfillment Partner
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 Meets Your Needs
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, and 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, such as time 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. You can use your resources to grow and promote your product line on eBay while your 3PL provider makes sure your orders get into your customers’ hands quickly and accurately. Choose a fulfillment center that will work with you to find optimal stocking levels and improve product turnover.
Choose Someone That Offers a Wide Range of Shipping Solutions
Make sure that the shipping solutions offered by the third-party fulfillment provider you choose will work for your products and your customers. Choose a partner that offers a number of different shipping solutions, so you can offer your customers the shipping choices they want.
Choose an eBay Fulfillment Partner That can Provide Seamless Integration
When it comes time to choose a fulfillment warehouse for your eBay business, make sure you pick one that communicates with you so you can tell your customers when to expect their orders and inform them of any shipping glitches. You should be able to see the status of every order, so you can answer buyer questions quickly. The systems at your third-party fulfillment center should seamlessly integrate with your eBay store and any other platforms where you sell, so there’s no delay in processing orders.
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 to a third-party fulfillment provider will help you bring your business to the next level.
When you find yourself overwhelmed by the work of running your eBay store and shipping all your orders, it’s time to outsource your eBay fulfillment processes. When you run out of space to organize and store your products, third-party fulfillment is a more flexible and cheaper solution than renting your own warehouse space. When you absolutely have to get your return rates below 5 percent, a great fulfillment warehouse can boost your seller rating and your eBay sales.
What are you waiting for?