How An Order Fulfillment Company Can Help Your Business
Many ecommerce business owners are actively seeking ways to reduce costs involved in the process of sales. This comes in the wake of the ecommerce boom, and the issues of ecommerce competition that did not face merchants when they were simply competing against brick and mortar stores. In the early days of ecommerce, businesses put their inventory online for purchase in order to sell it without the costs associated with maintaining a physical store and sales team. By making the shopping process happen on a website instead of in a store, merchants leveraged multiple advantages. First and foremost, ecommerce was far more convenient than traditional shopping, as a customer could purchase the things they wanted without leaving their home. They were able to shop with confidence that their purchase was just as secure as if they had traveled to a local store, and they could rest assured that their credit card information was safe. In addition to this aspect of convenience, merchants could leverage the lack of a need to maintain an expensive store and sales team with which they sold the items. Sales were made through ecommerce software, eliminating the need for a payroll for employees, rent on a retail space and utilities payments to keep the lights on. Because of these advantages they could significantly reduce the prices that items needed to be sold for while maintaining the same profit margins as the traditional merchants. The only added fees that needed to be worked into the sales prices were for shipping, and generally the costs of maintaining a physical store were far greater. In the early days of ecommerce, the online merchants enjoyed these benefits, and saw tremendous sales as a result.
Today, merchants and entrepreneurs realize that it is far easier to get your products available for sale through a website than it was to open a store in the past. This has created an intense level of competition between online merchants. Where they used to view their competition as the traditional merchants that could easily be beat in a price war, once numerous merchants came into the online space selling the same products, differentiation became necessary. The eventual ability for people to comparison shop multiple online stores selling the same things using search engines, and the race to the lowest possible prices began. People no longer care very much about the brand of a store, and instead are concerned only with price and delivery time. For this reason, ecommerce merchants need to find ways to further cut costs if they are to compete.
Order fulfillment companies offer ecommerce merchants that ability to further cut costs. By eliminating the need to maintain a warehouse space and staff dedicated to the order fulfillment process, costs can be reduced to only a minimal fee per order and a warehousing fee. The fulfillment company maintains your inventory in their space along with other customers, and uses their staff to fulfill the orders placed on your website. These orders are received through a software connection between your shopping cart software and their staff, and orders can be routed for deliver speed to the nearest warehouse to the customer. Using these advantages, ecommerce merchants can further reduce the costs of order processing while maintaining their profit margins. Be smart, use an order fulfillment company.