Omnichannel fulfillment guide: understand the services, benefits, and how to succeed
An omnichannel fulfillment strategy can give your customers a consistent experience across all sales channels. But, without the right logistics partner, consolidating your order fulfillment processes can be tough.
This guide gives you the basics of omnichannel fulfillment, including what it is and how to find the right third-party logistics company (3PL) to support your business.
You can read straight through or jump ahead to a section that interests you:
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What is omnichannel fulfillment?
Omnichannel order fulfillment is an approach to selling that uses the same order processing, inventory management, and customer tracking systems across all sales channels, including online stores, mobile apps, and brick-and-mortar locations. This means customers receive the same experience with your business, no matter how they shop.
When you're ready for an omnichannel ecommerce fulfillment strategy, consider unifying the different parts of your business that impact your customers’ orders, including:
- Order processing
- Inventory management
- Returns and exchanges
- Customer support
- Data analytics and tracking
Multi-channel vs. Omnichannel fulfillment
Both multi-channel and omnichannel fulfillment involve using different pathways to reach customers. But, instead of using one unified system, multi-channel fulfillment has a different inventory and order processing system for each channel.
Take a look at the benefits, features, and challenges of both:
|FEATURE||MULTICHANNEL FULFILLMENT||OMNICHANNEL FULFILLMENT|
Multiple sales channels
Multiple sales channels
Inventory management siloed by sales channel
One inventory management process for all channels
Order Fulfillment Process
Order fulfillment process siloed by sales channel
One order fulfillment process for all channels
Can outsource one or more channels
Can outsource the entire process
Can treat each ecommerce platform as an individual, siloed channel
Can use one process for all ecommerce platforms (increasingly popular strategy for ecommerce)
Brick & Mortar
Can use a separate process for brick & mortar
Can include brick & mortar with the correct strategy in place
Ability to create individual demand forecasts for each sales channel
Diversified brand experience for separate audiences
Reduced inventory costs and improved forecasting
Flexible options for orders and returns
Cohesive brand image and experience for your organization
More capital tied up in inventory
Potentially less convenient for customers who want to shop across channels
Inventory planning can be challenging
Inventory management can be challenging if you're not partnered with an omnichannel fulfillment company
Different channels might have different requirements for shipping
Potential complications with Fulfillment by Amazon
Benefits of omnichannel fulfillment
Consistent brand experience across channels
No matter how your customers shop, they receive the same experience when ordering, receiving, and returning your products. This helps you create a consistent experience for your brand so your customers always know what to expect.
Reduced inventory costs and improved demand forecasting
Staying in stock is less expensive when you have fewer inventories to maintain. You can also tighten up your forecasting with a clearer picture of how much inventory you need overall.
Increased order accuracy
More efficient fulfillment means fewer errors. This is especially true if you consolidate your processes with an omnichannel third-party logistics company (3PL) to deliver a consistent experience.
Easier returns and processing
You hope your customers don’t have to make returns. But if they do, omnichannel fulfillment makes it easier because they can purchase and return from any of your available channels.
Challenges of omnichannel fulfillment
Omnichannel fulfillment services can make inventory management challenging because it’s such a significant change to your processes. Instead of separate inventory stores for each channel, one supply of inventory feeds them all.
That means safety stock levels become critical. If you aren't partnered with the right omnichannel fulfillment provider, you could stock out faster than you think.
Various channels may also have different requirements for shipping, including labeling, timing, and packing slips. It’s important to know these requirements upfront and—if you’re outsourcing—communicate them to your fulfillment partner in case they don’t have the most up-to-date information.
If you’re considering Fulfillment by Amazon (FBA), it will be difficult to maintain a true omnichannel strategy since Amazon will control your inventory for that channel. However, it would still be possible to unify the rest of your channels, or you can use an FBA alternative that still helps you grow on Amazon.
Omnichannel third-party logistics: how can outsourcing help you?
While it’s possible to manage omnichannel fulfillment in-house, you might find it makes more sense to outsource to a third-party logistics provider.
An omnichannel 3PL can help you:
- Successfully manage inventory
- Cut variable costs, like warehouse space
- Manage customer returns
- Ensure order fulfillment accuracy and speed
Some companies will even facilitate communication with other suppliers, like manufacturers, transport providers, and the carriers that deliver your orders.
Omnichannel fulfillment services: Choose the right 3PL company
If you decide to outsource, choose your 3PL carefully. They can have a tremendous impact on your customer experience, operational costs, and business growth.
Before partnering with an omnichannel fulfillment provider, make sure they offer the following:
Expert inventory management
Find a 3PL that helps reduce costs by accurately estimating how much inventory you need and where you need it. Ask how they’ll keep you in the loop on our various sales channels, customer demand, and shipping costs.
Equipment, services, and tech that fit your needs
Search for a 3PL partner that can serve your business’s unique needs. For example, if you offer a subscription-based product, you may need kitting services, where your 3PL assembles customized packages with multiple products.
Guarantees that protect you
A 3PL that treats your products like their own will have the guarantees to prove it. Ask about inventory shrinkage, error rate, and how quickly they pick, pack, and ship your products. Their performance has a tremendous impact on your business.
Nationwide order fulfillment
To grow and scale effectively, use a 3PL with a nationwide fulfillment strategy. No matter where your customers are or how they prefer to shop, make sure orders can reach nearly all of them in two days or less.
Simplifying order fulfillment with an omnichannel approach can be anything but simple. It's our job to make it easy for you.
Scale your business with Red Stag's omnichannel fulfillment services
When it’s time to scale your ecommerce store—or add a brick-and-mortar location—Red Stag Fulfillment is here with omnichannel fulfillment services that put you first.
Omnichannel fulfillment you can trust
Dock-to-stock in 2 business days
We receive all shipments in less than two days because “Out of Stock” is never okay.
Once we receive your product, we won’t lose it or damage it—guaranteed.
(Ask other 3PLs about shrinkage allowance.)
Pick & pack accuracy
We get the right stuff to the right customer, or we’ll pay you for the mistake.
Same-day shipping till 5pm
With the industry standard of 3pm, we give two extra hours for processing same-day orders.
Integrations with all major ecommerce platforms
Integrate your ecommerce platforms with Red Stag's software in just a few minutes. You'll receive near-real-time inventory tracking across all channels to help you stay in stock and keep customers smiling.
Use integrations that are quick and easy to set up.
Want to know if we integrate with your ecommerce platform?Let’s talk
Stop worrying about hidden costs
Get the benefits of outsourcing your omnichannel fulfillment to a 3PL that specializes in helping ecommerce businesses scale without the headache of hidden costs. We don’t charge for setup or SKU management, and we stand firmly behind our 0% shrinkage guarantee.
Grow through Amazon
Depending on the size of our products, we can help you qualify for Seller-Fulfilled Prime (SFP). Our guaranteed order accuracy and stellar customer service support make it easy to get you the SFP seal of approval and add Amazon to your omnichannel fulfillment strategy.
Get near-real-time inventory tracking and snapshots
Red Stag will help you manage your inventory and make sure you stay in the loop. You’ll always know exactly how much product you have and when it’s time to restock or make adjustments.
Warehouse at strategic East and West coast locations
With strategically placed East Coast and West Coast locations, Red Stag can ship your inventory to most U.S. addresses in two business days or less. We can also cost-effectively receive your inventory with access to major ports, railways, and interstates.
Select one (or more) of our strategically placed warehouse locations to see our reach.
Frequently asked questions
What’s an example of omnichannel fulfillment?
Imagine you own an ecommerce store that sells sweatshirts across multiple online platforms, like Shopify, Facebook Marketplace, and Amazon. If you use one inventory management and order fulfillment system, you have an omnichannel fulfillment strategy. This is also true if you use the same system for sales through your brick-and-mortar store. Customers could order online but pick up or make returns in the store.
How can I transition to omnichannel fulfillment?
Whether you are hoping to move away from a multi-channel fulfillment approach or aiming to sell across more channels, multiple steps are involved in consolidating your inventory management and order fulfillment processes under one system.
The specific steps you need to take will depend on your unique business needs. You may find it best to partner with a logistics provider, like a 3PL that specializes in ecommerce or omnichannel fulfillment, to help you with the process.
Can I add a brick-and-mortar store to my omnichannel strategy?
Yes. With the proper systems in place, a brick-and-mortar store can be a great addition to your omnichannel fulfillment strategy. You could forgo the need to stock every item in-store while offering customers additional shopping options.
Is omnichannel fulfillment a good option for ecommerce operators?
It depends. There is no “one-size-fits-all” strategy, but omnichannel fulfillment provides you with the option to use one unified system for all of the ecommerce platforms you use, which many operators find beneficial.
Is omnichannel fulfillment an option for subscription-based offerings?
In some cases, subscription-based offerings can complicate inventory management, adding a challenge to omnichannel fulfillment. However, the right 3PL will offer kitting services to successfully manage and ship your subscription-based offerings.
Can I use an omnichannel fulfillment strategy if I wish to use “Fulfilled by Amazon?”
Not exactly. Even if all of your other channels use the same system, it technically doesn't count as omnichannel because Amazon will control your inventory management for anything you sell through their platform, dictating what stock you send, how much you send, and when and where you send it.
Are we a good fit?
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