3 Things You Need to Know About eCommerce Fulfillment in 2019
The numbers are in on the 2018 holiday shopping season, and once again records were shattered. Industry reports say U.S. shoppers spent $126 billion on online shopping over the holiday season – nearly 17% higher than in 2017.
As the appeal of ecommerce continues to grow among consumers, retailers need to perfect their online fulfillment game to ensure buyers have a positive experience.
Here are 3 things brands need to know about ecommerce fulfillment in 2019.
#1 – Shipping Costs are Rising
Rate increases continue to be handed down by all the major parcel carriers. And package size has a big impact on what brands pay for shipping.
In 2018, most major carriers introduced dimensional pricing to shipments. The more space your package takes up during transport, the more it costs. And Amazon is driving many brands – especially those in the Consumer Packaged Goods (CPG) market – to redesign their packaging in order to remove more void space. For some brands, reducing the size of their box by just 2” can lower their shipping costs.
As shipping rates increase and guidelines get more complex, more brands are turning to third-party fulfillment companies to help cut costs.
Many 3PL’s are expert ecommerce distribution centers. They have in-depth knowledge of the various dimensional weight formulas used by carriers and can find new ways to pack orders and save on shipping costs. Many will create custom boxes to precisely fit each order. 3PL’s will also rate shop to find the most appropriate drop shipping method and can offer very competitive pricing because of the high volume of orders they fulfill on a daily basis.
PFC’s track record of cutting their clients’ shipping costs is strong. In some instances, clients saw a 50% reduction. For a parcel shipping analysis from PFC, click here.
#2 – Fast eCommerce Fulfillment is Critical
When it comes to a consumer’s online shopping experience, slow is not an option. Thanks to the Amazon effect, today’s shoppers want their online orders fast – whether it’s an in-store pickup or a home delivery.
In today’s hurried ecommerce landscape, if a brand isn’t processing and shipping orders from a centralized location, then fast order fulfillment and low-cost shipping becomes a big challenge.
Most 3PL’s are strategically located so they can provide faster delivery to much of the United States. And as mentioned in #1, 3PL’s also leverage their experience with major parcel carriers to ensure their clients are getting the best shipping method at the best price. That’s good news for brands that partner with a 3PL.
The other good news is that carriers are starting to address industry demand for faster fulfillment. Last month, FedEx introduced a new service that offers later order pickups, which allows for expansion of next-day delivery in local areas and two-day deliveries within the continental U.S. We can likely expect to hear more news about emerging services such as FedEx’s throughout 2019.
#3 – Easy Returns Will Create Loyal Customers
Data shows that since 2015, product returns have increased more than 50%. Data also shows that nearly a third of all products ordered online are returned – whether it’s because of damage, a wrong item received, or general dissatisfaction with the product.
Because the rate of product returns is so high, brands should focus as much on their returns process as they do their order process. When returns are done the right way, they shouldn’t be a loss leader for the brand. And if a brand makes it easy for consumers to make a return, they’re much more likely to buy again.
To make returns seamless and hassle-free for both themselves and their customers, brands are turning to 3PL’s for a solution.
In 2018, PFC launched a new Return Merchandise Authorization (RMA) portal that simplifies and improves the returns process for both brands and customers. The portal streamlines the entire returns process – customers can make easy self-service returns by submitting a return request online, printing a merchandise return label and tracking the status of their return.
About Promotions Fulfillment Center
At PFC, our clients’ success is our #1 priority.
Retailers and ecommerce brands that partner with PFC have historically achieved considerable cost savings in excess of 35% and have significantly improved their program ROI.