One thing is for sure, ecommerce companies are not only here to stay, but they are also growing at an unprecedented pace. In 2013, according to Forrester, ecommerce sales totaled $231 billion, and projected sales in 2015 are set to reach $300 billion plus! With this tremendous growth, there is also a great demand for outsourced fulfillment services. Largely utilized so that online merchants can focus their attention on sales and marketing rather than logistics, these “invisible” companies tackle all of the back-end storage, order fulfillment and shipping functions. Finding the right fulfillment company can be a bit of a challenge, however, since ecommerce retailers require a suite of services that not all fulfillment companies offer. Understanding the differences between general fulfillment providers and e-commerce fulfillment companies will help retailers choose the best service for their needs.
A typical fulfillment center houses a multitude of products for many companies. General fulfillment providers tend to focus in on core fulfillment processes, such as storage of goods on behalf of their clients, fulfilling orders, and shipping orders to consumers. Depending upon the specialization of the fulfillment provider, end customer focal points may either be retail customers, wholesale customers, end consumers, sales teams within an organization, or others. The needs of each of these specializations are quite unique. For example, retail clients oftentimes transact business using specialized purchase order information via EDI (electronic data interchange), whereas direct to consumer fulfillment services involves receiving order information from an online shopping cart, and shipping small parcel orders direct to the consumers business or home address. Oftentimes, you’ll see that fulfillment firms try to perform all of these services so that they can capitalize on an assortment of customers. However, as each of these areas becomes increasingly more complicated, fulfillment firms are shifting more and more to specialty niches.
The ecommerce fulfillment niche is unique for a number of reasons. First and foremost, providers have to be able to communicate with the online shopping software of the merchant. This would be a straightforward process if every ecommerce seller used the same shopping cart. However, there are literally hundreds of shopping carts in use. Therefore, fulfillment providers must be able to integrate online with an assortment of shopping carts so that they can ultimately receive all online orders and send each of these consumers the tracking information for their packages. Furthermore, online retailers usually have a great need for business intelligence, and require robust real-time online reporting of inventory and order data.
But this just begins to scratch the surface for leading edge e-commerce fulfillment providers. In order to better support ecommerce merchants, fulfillment providers within this niche are expanding their service, offering to better support retailers. Instead of just offering storage and distribution, for example, some companies are trying to provide increased value through offering professional online marketing and social media services, photography service for managing the shopping cart products, and call center services. Some companies even come with a track record of success for having successfully managed ecommerce businesses themselves, thereby enabling them to help merchants capitalize on missed opportunities on various seller platforms such as Amazon and eBay.
While many fulfillment companies can do a good job handling most of the product storage and distribution services required, specialist ecommerce providers, by becoming true champions of Web commerce, are better able to assist merchants in the long run. Especially in this day and age, it is imperative for merchants to use every option at their disposal to successfully grow the sales and profitability of their company. Finding a specialist ecommerce provider that can act as a partner in the growing online marketplace is quickly becoming a necessity.
