3 Signs It’s Time to Outsource Fulfillment for Your Subscription Box
Running a subscription box company comes with a lot of important decisions.
Figuring out your market and how to grow it are two obvious ones.
Another decision that is every bit as important, but less black and white, is knowing when you should consider outsourcing order fulfillment. As subscription box businesses grow fulfillment and shipping are areas with a direct impact on customer experience and operating margins – yet there are no hard rules on when outsourcing makes sense. The good (or bad) news is there will be signs. You just need to know what to look for.
Poor Inventory Planning:
The cost of the goods in your box are likely your biggest expense. This means you need to be very adept with your sourcing strategy, including inventory planning.
A professional warehouse will help you be better at tracking inventory, including inbound receiving, inspection, and counts. They’ll help ensure you have the products in-house each month so your box ships on time.
Of course, poor inventory management is not the only reason boxes may ship late. The order fulfillment process takes a lot of time. This is what fulfillment companies like Kable are experts at – being efficient with pick and pack.
They can provide a scalable source of skilled labor to accommodate any volume of shipments, and do so with accuracy and speed. At a point, packing boxes isn’t scalable for most subscription box companies to keep up with on their own. Outsourcing helps keep orders shipping on time and at the lowest fulfillment cost possible.
High Shipping Costs:
Shipping costs are largely a function of volume – so the more shipping volume you have the better shipping rates you will get from carriers. Growing subscription box companies can usually benefit from the rates offered by a larger fulfillment warehouse.
In many cases, the shipping savings will offset much or all of the costs they are paying for fulfillment services. This makes the decision an easy one.
Growth is a great thing for a subscription box company. But, it also forces the company to make a lot of tough decisions – like when and how to outsource their order fulfillment. If any of these 3 problems seems familiar the time may be right for you.