Accurate, fast eCommerce fulfillment is an essential asset for online business owners. It’s vital to pick the best fulfillment option for your company. Sometimes, that will mean outsourcing fulfillment because you’ve grown too large to ship orders yourself. In other cases, you may be looking for a new 3PL because you want better service or faster order fulfillment.
Whatever the reason, onboarding with a new logistics company is a critical process. It is worth the time and effort to make sure you’re set up correctly with your new 3PL. Here are some tips on getting started with a fulfillment company from the pros at Red Stag Fulfillment.
What does a fulfillment center do?
A fulfillment center is a warehouse that provides fulfillment services for multiple clients. A third-party fulfillment company will accept inbound shipments, track and warehouse products, and fill and ship your customers’ orders. Many 3PLs provide additional services, such as kitting and light assembly.
And, if you’d like even more information, Red Stag Fulfillment has prepared a complete guide to onboarding with a new logistics company.
How to choose the best order fulfillment company
Fulfillment warehouses are not all alike. Some specialize in shipping certain products or serving particular industries. The best 3PL services company for your eCommerce business might not be the one closest to you. You need to find a 3PL that provides the services you need, has expertise in working with products like yours and offers accurate and fast fulfillment services.
But how can you tell which fulfillment service is right for you before you sign the contract? After all, your fulfillment company is one of your most important choices, one that could make or break your business. Here are some tips to help you focus your search.
Look at bottom-line benefits as well as top-line costs
If you’re outsourcing your fulfillment for the first time, you’re entering a new pricing model. “You’re taking fixed costs and trading them for variable costs,” said Chris Molitor, VP of Business Development at Red Stag Fulfillment. “When you go to a 3PL, you only pay for what you use.”
Start by reviewing your current fulfillment expenses per month and breaking that down into the per-package cost. Then compare that to the pricing at potential 3PLs. Be sure to consider long-term savings as well as per-month charges.
Don’t stop there, however. The value of outsourcing fulfillment is more than getting rid of fixed costs. Assess the quality and speed that potential logistics partners can deliver for you. Your 3PL could save you a substantial amount of money when you look at the total value picture.
“You want a cost-effective solution, but you also want to consider the benefits the provider is offering you,” Molitor said. “Those can be subjective. It’s hard to monetize the headaches you have because of payroll or carrier issues, for example.”
Red Stag Fulfillment offers accuracy guarantees that include same-day fulfillment and accurate picking and packing. We pay our clients $50 when we make a mistake. “We’re not in the business to shell out $50 checks, so we focus on getting it right the first time and being an extension of your brand,” Molitor said. He noted that getting fulfillment right the first time gives a significant lift to your brand image and customer satisfaction. Good fulfillment services are almost invisible, but they are essential to attracting and retaining new customers.
Find the right fulfillment services for your business
The essential qualities you’re looking for when you’re outsourcing fulfillment will depend on your business model, your products, and your pain points. If you sell perishable food items, you need a warehouse licensed to store and handle food, which might include cold storage. If fast delivery is at the top of your list, choose a company with multiple warehouses located near your customers so that it can ship orders through fewer shipping zones.
Ask the right questions
There’s nothing worse than realizing the question you should have asked—but didn’t—when it’s too late. Red Stag Fulfillment has created a fulfillment company questionnaire to help you check all the right boxes when you’re outsourcing fulfillment services or switching fulfillment companies.
How to get started outsourcing fulfillment to a new logistics company
Once you find the perfect 3PL for you, the onboarding process begins. Red Stag Fulfillment has a dedicated onboarding team that will help you navigate your transition. The onboarding team is crucial to creating a pain-free and seamless transition, so you have extra assistance to get you through any minor hiccups as you start with a new fulfillment company.
“The goal is to monitor client operations for 30 to 60 days to make sure everything runs completely smoothly.”
Start by reading the fulfillment company agreement carefully before you sign it. “Be aware of any hidden fees, and read the proposal thoroughly to make sure you’re not blindsided,” Molitor said.
You can also help your 3PL get ready to serve your needs by sharing as much information about your business as possible. “The more data that they can provide us, the more we can plan,” said Sam Hughett, general manager of Red Stag Fulfillment’s Knoxville warehouses. “We love clients that provide us a lot of data.”
Setup and testing with your new fulfillment company
Of course, you want the switch to your new fulfillment company to be speedy. Backorders can pile up during the transition. However, the setup is not the place to skimp. Add all your SKUs to the system and create ASNs before you send your initial shipments.
“SKU creation and ASN creation are absolutely vital before any deliveries arrive,” said Matt Novak, client relations project manager at Red Stag Fulfillment. Otherwise, your products could be delayed at receiving or even turned away. “For a new client that we’ve not received inventory before,” Novak said, “we’re not going to know what it is or what to do with it” if the products are not in the system.
With all the correct information, your new logistics company may be able to clear backorders quickly. “Red Stag Fulfillment can turn a full container [500-700 units] in a day,” Hughett said. “We can unload and ship those products right back out.”
However, your setup is key to getting up to speed fast when you use outsourced fulfillment services. “If something is not set up correctly on their end or our end,” Hughett said, “that’s 700 shipments that could have issues.” You could end up with a fulfillment delay to put products on the shelves, only to take them off again, rather than same-day order fulfillment through cross-docking.
There’s another reason to spend the time to get set up right when you’re outsourcing fulfillment to a new 3PL: It may save you from incorrect shipping charges. “When we’re completing orders, we’re passing weight and dimension to the carriers via API,” Novak said. If the weight isn’t correct in the system, you could end up with carrier surcharges that you weren’t expecting.
Ready, set, ship!
Once your systems are up and running with your new outsourced fulfillment center, it’s time to work out the kinks. Mike Williams, Red Stag Fulfillment onboarding specialist, said, “The goal is to monitor client operations for 30 to 60 days to make sure everything runs completely smoothly.” At Red Stag Fulfillment, the onboarding team resolves any issues with kitting, returns, or other processes before setting the client up with a permanent account manager.
“We’re excited to see this process as we roll it out,” Novak said. “We want to make sure that every client that chooses to work with Red Stag has the best experience we can offer.”
Once you’re up and running, you won’t have to think much about logistics. The professionals at your outsourced fulfillment center will take care of getting your orders to your customers. If any problems do arise, your account manager is ready to help you out. At Red Stag Fulfillment, we try to respond to every customer service query within a few hours.
3PL readiness checklist for outsourcing fulfillment services
There are a lot of details to take care of when you’re outsourcing fulfillment. That’s why we created a comprehensive onboarding guide to help you navigate the process, no matter who your 3PL is.
Here’s a checklist of some of the most critical items on your to-do list when you outsource to a new fulfillment company:
- Read the agreement carefully.
- Get training on the 3PL dashboard.
- Enter your SKUs into the system.
- Connect your shopping carts to your fulfillment company inventory management system.
- Let your new 3PL know what box sizes you use, so they can have them in stock.
- Do a test order to make sure the system is working.
- Submit ASNs for your inbound stock shipments.
- Ship inventory to your new 3PL.
- Monitor fulfillment operations for the first few weeks to make sure all the processes are running smoothly.
- Turn your focus to marketing and growing your business. Your fulfillment is in good hands.
More resources for starting with a new logistics company
When you outsource your eCommerce fulfillment, think of it as entering a partnership. Your 3PL will present your products and brand to your customers. You need a partner that cares as much about your business as you do.
“At Red Stag Fulfillment, we are going to treat your business like you do,” Molitor said. “We want you to succeed. The more you succeed, the more we succeed.”
Being prepared for the onboarding process with a new fulfillment company is a great way to set yourself up for success. We hope this article and our onboarding guide help you get off to a good start when you’re outsourcing fulfillment.