Category : MultiChannel Fulfillment

Can Outsourcing Fulfillment Increase Sales?

As your ecommerce business grows, managing your fulfillment operations in-house may become more than your business is equipped to handle.   Fulfilling more orders requires additional warehouse space, hiring more employees, and possibly upgrading your order processing system.  Once business volume warrants it, many businesses seek to partner with a 3PL (third party logistics) company.  The benefits provided by 3PL’s may contribute to higher sales as you concentrate on growing your business.

Better Service

Today’s ecommerce customers expect efficient order fulfillment and even faster shipping.  Consumers also want more flexibility with their orders, such as the ability to check inventory for a product, better decision-making tools, and shipping options like next day delivery.  When your business grows to the point that you are no longer able to offer your customers best-in-class service, it is time to explore other fulfillment options.

Lower Shipping Costs

Due to economies of scale, many fulfillment companies are able to offer lower prices for shipping.  A 3PL knows all of the shipping options and will be able to recommend what will be best for your business’s needs.  This can directly impact your bottom line, as many companies spend a large percentage of their budget on shipping.

Streamlining Orders

A greater assortment of shipping options, such as same-day delivery, has accelerated the pace of order processing.  Fulfilling orders in a timely manner means that customers receive their order when expected.  If your business cannot fulfill orders quickly and accurately, customers may be unhappy.  The right 3PL can provide you with solutions for all of your supply chain needs from order fulfillment to freight management.  Streamlining these processes will save you money in the long run.

Match Fulfillment to Your Growth

One of the challenges of order fulfillment is fluctuations in sales volume.  Fulfillment companies have the resources to handle it.  For example, if your business’s sales increase dramatically during the holidays, it might be difficult to meet that added demand in-house.

A fulfillment partner will enable you to grow your business without worrying about fulfilling the added orders.   And, if your business decides to expand internationally, your fulfillment partner will be able to guide you through that fulfillment process as well.

Technology

Partnering with a fulfillment company gives you access to the latest technology and warehouse equipment, as well as being able to track all shipments.  3PL’s are able to spread technology update costs over multiple customers so your business does not have the burden of capital investments alone.   This is a cost-effective way to keep up with the advances in the industry.

Focus on Your Business

Many business owners have too many tasks that need their attention and fulfilling orders can take a lot of valuable time.  Outsourcing your fulfillment allows you (and your team) to focus on other areas of your business, such as growing sales, strategic planning, marketing, and customer service.

These advantages enable you to grow your business and increase sales without worrying about the fulfillment side of the business.  The order processing experience that 3PL’s offer ecommerce companies will give your business the best results to improve profits.  If you are considering outsourcing your fulfillment operations, contact Kable at http://www.kablefulfillment.com/.

Making Sense of the New Peak Season Surcharges from UPS

This upcoming holiday season, shippers will be paying even more for deliveries made by UPS.  During selected weeks in November and December, UPS will be introducing their new peak shipping charges.  These charges, which will be published on September 1, 2017, apply mostly to U.S Residential, large packages, and packages Over Maximum Limits.   Shippers will need to be aware of when they are shipping larger residential packages so they can avoid the peak season surcharges.

During last year’s holiday season, UPS’s daily volume was more than 30 million packages on more than half of the shipping days.  The company hired almost 100,000 season employees during the peak season.   It is expected that shipping volume will match or exceed that this year.

UPS explains that in order to meet the doubled daily volume during this busy shipping time, the higher charge will help ensure UPS keeps up with consumer demand and provides on-time delivery.  Shipments that are larger, heavier, or unconventional shapes create more complex operations, adding to the cost per package to ship.  Since UPS employs additional sorting and delivery personnel, increased air and truck cargo capacity, and temporary facilities during this time of year, the surcharge will go towards financing these additions.

The new peak charges for 2017 are as follows:

Nov 19 to
Nov 25
Nov 26 to
Dec 2
Dec 3 to   Dec 9 Dec 10 to
Dec 16
Dec 17 to
Dec 23
UPS Next Day Air® Residential n/a n/a n/a n/a $0.81
UPS 2nd Day Air® Residential n/a n/a n/a n/a $0.97
UPS 3 Day Select® Residential n/a n/a n/a n/a $0.97
Ground Residential $0.27 $0.27 n/a n/a $0.27

n/a = no additional charge during this period

For example, a package that weighs one pound in a Zone 2 shipment that ships via 3 Day Select will increase almost 10%—from $9.90 to $11.07.  Multiply that by 10 similar boxes you need to ship, and you just incurred fees in excess of $110!

One concern for non-ecommerce customers is that the surcharge will impact them as well.   These are customers that regularly use UPS and might be hit with the extra charge too.  Those companies that do not do additional business during peak season, such as prescription drug businesses, will also be affected by the surcharge, even though their shipping volume will remain consistent.

What can shippers do to minimize the impact of the peak season surcharge? 

  • Be aware of the sizes you are shipping and if they will be affected by the surcharge.
  • If possible, ship before or after the highest peak season time (December 17-23).
  • If you are taking orders past December 17th, consider charging more to the consumer to help absorb the cost.
  • When shipping packages that are larger than the published maximum size limits, consider UPS Freight.

The UPS peak surcharge is sure to affect millions of packages sent during the holiday season of 2017.  It is highly likely that Fed Ex will follow suit by raising their peak season rates as well.

5 New Ideas for Selling More Subscription Boxes

Once you have established your subscription box company, finding ways to keep new sales coming in can be challenging.  Consistent growth in sales, however, is a necessity to the future of your company. There are several things you can do to keep the selling momentum going, even as new subscription box companies enter the market daily.

Expand Your Social Media Content

You probably have a Facebook, Twitter, and Instagram page, but are you using them to the full potential?  If you are posting just to put something up there, you are not making the most of social media.  This is a platform for you to bring value to your target audience.  Make sure your content speaks to your followers, and you will be seen as the authority in your market.     Tip:  Spend some time interacting with your followers and share/re-post any of them using your products, as this is how you further grow your brand awareness.

Get to Know the Influencers

Every industry has their own group of influencers that have a network of followers that most likely far exceeds your following.   Reaching out to these influencers to get an endorsement on their social media page could amp your brand awareness triple-fold.   In order to get an endorsement, you send them a free box to have them sample it, and then post about it.   If you aren’t sure who the influencers are in your industry, research them using sites such as followerwonk.

Blog

Don’t have a blog yet?  Set one up, as soon as possible.  This is one avenue to further offer your customers valuable information.  A blog that speaks to your target market will retain and gain new customers; sharing it across your social media channels gives you great content.  It is also an effective way to increase your SEO if done correctly.   If you are not great at writing, hire someone who is.  Or, see if there is a potential partnership with a guest blogger, which is another great way to expand your brand’s reach to a whole new set of followers.

Coupon Codes

Consumers love to save money and a coupon code alone is enough incentive for some to make a purchase.    For those who may be new to subscription boxes or new to you as a customer, this is a way to get them to jump off the fence and buy!   Create a few coupon codes and test in different arenas so you can find what will work best in terms of initial purchase and then retention.  Sharing a coupon on sites such as RetailMeNot, and another on your social media channels will give you a good A/B split test to start.

Video Content

The goal of video content is to get it to go viral, thus increasing your brand awareness.  In order to do this, ensure that the video content is consistent with your brand.  Add a little humor or interesting facts to make the video engaging to your audience.  You may not feel comfortable doing this yourself, but there are plenty of people who specialize in it.

 

Increased marketing efforts such as these will lead to increased sales.  If your company needs help managing your subscription box company growth, please visit our website today at: Kable.com.

5 Quick Tips for How Subscription Box Companies Can Save on Packaging

It’s not surprising to say that packing materials are necessary to keep items from getting damaged when shipping – but they need to look good to. Unfortunately, they can quickly become a big expense for a subscription box company. Here are five ways that you can cut down the cost of packing materials without risking damage or the quality of your customer’s “un-boxing” experience. carton

  1. Buy in Bulk

Once you decide on the box sizes and types of packing materials you will need, purchase them in bulk to save money.  A simple search on the internet will show where you can purchase the items for the best price.  Amazon, ebay, and Walmart all offer shipping materials at reasonable prices.  If a certain item will require a different sized box, plan for that ahead of time so you can have it on hand when it comes time to ship that month.

  1. Use the Correct Size Box

It’s impossible to stress the importance of using a box that is the right size for your items enough.  Shipping in a box that is larger than necessary contributes to a much higher shipping charge, as well as extra packing material.  Reducing the box size by just an inch can make a difference in shipping costs, and if it can fit in the mailbox, even better!

  1. Recycle, Recycle, Recycle

Items such as boxes, bubble wrap, peanuts, plastic air bags, and envelopes can all be reused.  Just make sure the items are in very good condition and clean before using them again. Many “new” packaging materials are made from recycled materials as well. Using these types of products can have a great appeal to many potential customers.

  1. Free Shipping Supplies

If you are able to, take advantage of free shipping supplies from your carrier.  USPS, FedEx and UPS all offer some items for free.  For example, the USPS offers free flat rate boxes and free mailing tubes for Priority Mail.  If you find items that are suitable for your shipping needs, you’ll maybe even save enough to offset slightly higher shipping costs.

  1. Search for Sales

Sometimes, retailers run sales or promotions on certain shipping supplies.  Office Max and Office Depot offer coupons if you register on their website or at their stores.  These coupons can be used for tape guns, boxing tape, and tape guns.

 

With just a little effort, subscription box companies have many options for cutting down on the expensive packaging materials.

Starting a Subscription Box? Here’s 3 Ways to Save on Shipping

Shipping is a big expense for every subscription box company and is especially important to think about as you are first starting out.

USPSHowever, even established subscription box companies can benefit from evaluating their own shipping patterns and requirements on a regular basis. It’s a key exercise for any online retailer to prevent overspending on small parcel shipping.

Do the Research

There are several carriers available to help ship your customer orders, which gives you some leverage when negotiating rates.  Don’t assume any one is your only choice – there are many parcel consolidators and parcel delivery services that can complete with the USPS and other large carriers. Any established online business should discuss their shipping history with their current carrier to get better rates, or can use that data to negotiate with a new carrier.  Plus, the more knowledge you have about your own shipping patterns the better pricing carriers can offer.

Keep in mind that it may be cost-effective to use two different carriers if you are shipping packages that differ in size or weight, or to several areas of the country.  Knowing your company’s needs and considering all the options is the only way to get the best shipping rates.

Save on Packaging

Packaging for shipments can also be a large expense, particularly for smaller companies.  One way to reduce costs is to buy boxes and packing materials in bulk.  When possible, recycle boxes and packing material.  Not only are you helping the environment, but also your bottom line.

Also, make sure the box size is the correct size for your items.  Shipping in boxes that are too large can mean you are paying for extra shipping weight unnecessarily. Packaging that is too large, or too small, can also lead to expensive damages and returns. And unhappy customers.

Shipping Insurance

Depending on the value of your subscription box, it may not be worth paying extra to insure it.  If your carrier offers reliable service with few damaged or lost items, paying for the occasional damaged package might far outweigh insuring every box. Investigating your rate of returned packages can help you figure out if it is worth this extra expense.

Shipping can account for 10% or more of the operating expenses for a subscription box company. Making educated choices for how you manage shipping can often be the difference between a profit or losing money for your subscription box company.

Inventory Management Must-Do’s for Every Subscription Box Company

Aside from the obvious expense of purchasing inventory in the first place, failing to properly manage it can lead to shortages for customers, costly overages for product that sits unsold, and consume capital resources. warehouse Proper inventory management ensures your subscription box company is operating efficiently, while continuing to meet customer demand.

Here are 3 ways to keep your inventory management process working.

Conduct a Physical Inventory Count

In order to correctly assess inventory, you have to know what you have. This seems obvious, but accuracy with inventory is no simple thing for companies of any size. Take into account not only finished goods, but raw materials and works in progress.  Physical inventory counts should be compared against data records to see what discrepancies exist and how the process can be improved. For subscription companies that outsource fulfillment and warehousing, your provider should be performing regular cycle counts to insure inventory levels are accurate. It’s important their inventory counts and yours are reconciled regularly.

Forecasting

Optimal inventory levels means having enough of an item to fulfill a month’s worth of subscription boxes without being overstocked.  Inventory for subscription box companies is unique in that products are not typically forecasted by demand, but by number of box subscriptions sold. This means the growth and sales trends with your own business must be considered precisely each month – and not seasonally or annually as with other types of retail businesses.

Systems and Data Maintenance

For growing, larger, or more complex subscription box companies, inventory management can require a core team with the ability and tools to evaluate, analyze, and order product. It starts with a process and system that provides timely access to inventory data. At some point, a dedicated inventory control specialist may be required to oversee inventory operations. Implementing inventory management software, in the form of a WMS or ERP, is another way growing companies stay on top of the challenges that come with controlling inventory.

Getting good at inventory management is not the reason you started a subscription box company, but it can be the one thing that determines the success or failure of it. Implementing these ideas will help to ensure effective inventory management so you always have the correct amount of each item on hand and your customers stay happy.

Do You Have a Productive Pick and Pack Process?

Picking is the process of pulling inventory from one or more locations to be included in an order, and packing is the gathering of these items to be placed in packageswarehouse to be shipped to the customer.  An efficient pick and pack process means your company is operating optimally, while satisfying customer expectations.  To make sure your company’s shipping process is efficient, make sure you are doing the following:

Inventory Counts

A productive pick and pack process starts with a correct inventory count for each and every product.  Since miscounts result in oversells and understocking, it is important to start with an accurate inventory amount.  An automated counting system like a barcode scanner or RFID sensors will keep track of your items.

Layout

Being able to find items to pick is important to operating an efficient warehouse.  High-selling items should be placed closest to the packing stations since they will be picked most often.  This increases productivity by cutting down on the time it takes for an employee to pick an order and process it.  If you have items that are purchased together, put them near each other for greater efficiencies.

Organized Areas

Your pick areas should be neatly organized so warehouse workers do not waste time searching for items.  Warehouse shelves should have bins that are easily accessible and are transparent.   At the packing stations, packers should have all supplies necessary to pack efficiently.  Have several box sizes that fit your products size and weights correctly to eliminate shipping overages.

Kitting

Kitting refers to the pre-assembly of individual products in a ready-to-ship package.  Putting items together saves time during the picking process, and cuts down on the materials necessary to pack the order.  This works especially well if you sell in bulk quantities or have products that are complementary and are often purchased together.

Plan

Sometimes, certain events happen that will affect your fulfillment processes.  Your pick and pack services should be flexible enough to handle these events, or a sudden surge in orders.  If you are a retailer that experiences a higher volume of orders during the holiday time, make sure you have a fulfillment plan for that season.  Your pick and pack processes should be well-documented to get through any challenging or busy periods.

Final Check

Mistakes are going to happen, but decreasing the chance that they do, will add to your bottom line.  For every incorrectly picked order, there is a significant cost associated with it with return shipping, and then re-shipping the correct item.  One error costs as much as shipping two or three products.  While automation is a great time-saving tool, an actual employee should do a final check of each shipment before it leaves.  This final double-check can catch costly errors before they leave the warehouse.

If your company’s pick and pack process is not operating optimally, it might be time to look to another resource.  Kable Fulfillment can handle your business’s fulfillment process from start to end.  To learn more, please visit our website at www.kablefulfillment.com.

How to Provide Efficient Fulfillment This Holiday Season

Ready or not, the holiday season is officially here.  Holiday fulfillment can present a whole range of logistics challenges if you are not prepared. ebay

Most business to consumer retailers experience a huge surge in sales during this time of year.  This is the time of year to gain new customers and to retain those who will become long-term buyers to your brand.  If your company is not ready to meet this increase in demand, however, the result can be unhappy customers whose gifts did not arrive on time and a hit to your brand’s reputation.

There are several things that can help you prepare for your company’s busiest season:

Determine Your Peak Days

Use data from past holiday seasons to figure out your company’s peak fulfillment days.  If you are a start-up, a 3PL partner can develop sales predictions for you.  A third-party logistics provider will combine data such as sales volume and customer behavior to determine the days you can expect the most orders during the holiday season.

Plan Fulfillment Around Your Peak Days

The inability to ship out the orders you receive in a timely manner during the holiday season can have catastrophic results for your company.  Staffing can be one of the biggest challenges during this time of year so provide additional training and cross-training to employees.  You can also consider hiring interns, for a lesser cost than a temporary employee, or temporary employees from a nonprofit organization in exchange for a donation to their charity.  Hiring additional staff is not the only solution to the peak season, all fulfillment operations must be planned to handle the increase in demand.

Stock Up

If you fulfill in-house, make sure you have an ample supply of boxes in several sizes, tape, packing materials, labels, and printer ink.  If your scales, tape guns, or packaging dispensers are worn, it might be a good idea to update them to handle the peak season.  Make sure there is enough space to accommodate the increase in sales and that it is organized for efficient order processing.

Systems Review

Now is the time to ensure all IT operations are effective and can handle the increase in volume.  Data-tracking systems should be updated to be able to address any issues quickly.  Review your order processing procedures with all employees to ensure they are fulfilling efficiently and correctly.

Shipping

Delivery options differ during the holiday season so you need to know your carriers’ specifics, such as cut-off dates, pick-up times, and delivery guarantees.  Understanding these details is necessary for providing realistic delivery expectations to your customers.

Consider Outsourcing

If you are a retailer that will see a significant increase in sales during the coming weeks, you need to make sure you can handle it without hurting customers.  If the spike in sales will cause customer service and delivery issues, consider using a 3PL for your fulfillment needs because today’s consumers demand correct orders on time for the holidays.  To make sure you can meet your increase in demand this season, visit www.kablefulfillment.com.

Saving Money on Small Parcel Shipping Despite the Upcoming Rate Increases

For a small- or medium-sized e-retailer, shipping costs play a large role in overall profitability.  A shipping increase, suchFirst_FedEx_van_Memphis_TN_2013-05-17_003 as the GRI increase of about 5% just announced by UPS for next year, can have an impact on a small organization’s bottom line.  Businesses that do not sent large shipments of pallets at one time can be at a disadvantage from a cost perspective because they do not ship a high volume.  These guidelines can help your ecommerce business minimize the increases expected by UPS and FedEx for next year.

Choose Your Carrier Wisely

As a small e-retailer, it is worth the time to research which carrier or carriers will work best for your shipments.  With pending rate increases by UPS and FedEx, it might be the time to look at other shipping options.  Since the increases are usually different based on destination location and not an overall increase across the board, you may want to use different carriers for shipments to different areas of the country, based on the cheapest rates.  As your shipping volume grows, so does your negotiating power.

For small packages that do not weigh much, don’t forget about the USPS.  Their rates are usually the lowest for these types of packages, with delivery confirmation and tracking numbers at no cost.  Be sure to look into Priority Mail, Priority Mail Flat Rate, and Priority Mail Regional Rate to find which options will be most economical.

Determine Customer Shipping Fees

Create shipping policies for when the business will pay for shipping and when the customer will.  Will you offer free returns?  If so, find the easiest way for those to be sent back.  Once you have determined your shipping policy for purchases and returns, communicate them to the customer via your website and customer service.

Use a Small Business Specialist

Most carriers have a small business specialist that will work with your business to meet your shipping requirements.  Discussing mode of transportation and delivery timing can help to shave off at least 30% in fees.  For example, using ground services instead of air services might be better for certain sized packages instead of others, depending on weight and distance.

Use a Postage Meter

A postage meter is an invaluable tool for a small ecommerce business.  Use it to weigh packages, determine postage charges, and print shipping labels so you are paying exactly what you should, and nothing more. Pitney Bowes, a postage meter provider, estimates small businesses can save as much as 20 percent on shipping costs by using one.

Pay Attention to Additional Fees

Most likely, additional fees like extended delivery and fuel surcharges will increase in the coming year.  In addition, peak season surcharges are expected to go up.  During this time of year, an ecommerce business might try driving customer pick-up in its stores with incentives.

Analyze Carrier Performance

Whether you are using one shipping carrier or three separate carriers, it is important to understand the costs associated with each, as well as the service you are receiving.  Keeping a scorecard with metrics such as meeting pickup times, delivery reliability, customer service, and access to tracking data are all components that should be evaluated.  Overall costs should be compared among carriers, including baseline costs by weight and distance, cost by service level, and any additional fees.

To find out if you could be saving more on your ecommerce shipping, contact us at www.kablefulfillment.com.

Ecommerce Delivery Trends for 2017

Online customers are continually expecting more delivery options when purchasing from an e-retailer.  This is a trend sure to continue into 2017.  Customers want merchandise to be shipped quickly and at a low (or free) cost, and retailers are trying their best to meet these demands.  Here are many of the delivery trends being initiated by online sellers that we see coming to fruition or continuing into 2017.   truck

Free Shipping

Online customers are becoming savvy about looking for, and asking for free shipping.  Many retailers are offering free shipping with a purchase of a certain amount, or during specific times of the year.  Coupon codes with a free shipping promotion have also become a very popular selling incentive.   Online retailers have found free shipping has become a very effective promotion.

For smaller retailers that sell unique products, a free shipping offer can be built into the price of the product since the consumer cannot comparison shop.  For larger retailers, absorbing the shipping cost for the consumer will result in a larger amount of sales to offset the hit.

Free Shipping Membership

Another trend in delivery options is a free shipping membership.  Customers get unlimited free shipping for an annual fee.  Amazon was the leader with its Amazon Prime program, and several other e-retailers have joined in.

Independent shipping membership programs, such as ShopRunner, work directly with certain retailers to give customers free shipping.  Retailers benefit because customers tend to purchase from the retailer again to take advantage of the free shipping offer.

Flat Rate Shipping

Some retailers that cannot afford a free shipping promotion are choosing to keep shipping simple with a flat rate offer.   Customers pay one rate for all orders, which avoids surprise at checkout.  Average order price and shipping amount should be considered when choosing the flat rate, although flat rates under $10 usually work best.

Free Upgrades

Other retailers who are unable to offer free shipping have tried a shipping upgrade promotion.  Enabling the customer to upgrade to free overnight or second-day shipping still gets them their order quickly, and they are incurring some of the cost of the shipping.   Negotiating with your shipping carrier might also help to deflect some of the cost of the upgrade.

Faster Delivery

Most customers expect merchandise within three days of ordering, causing many companies to consider next day or two day shipping options.  Larger e-retailers are obviously at an advantage here with more warehouses and resources to be able to get orders out the door faster.

Same Day Pickup

Now customers can purchase online and pick up at their local store, making for a faster and more convenient shopping experience.  In order to make this delivery option viable, companies use warehouses that are close to their stores.

Options

Overall, online buyers expect options, so make sure you include next day, two day or standard shipping on your website’s checkout page.  It is important to have to appropriate shipping costs for each option displayed so the customer understands the total amount of the shipping charge.

Since customers have the ability to easily price shop online, offering a promotion on shipping can help to increase sales.  Finding a promotion that will work for your bottom line and at the same time, satisfy your customers, is important. Kable Fulfillment can help you offer your customers the shipping options they want.  Visit our website at www.kablefulfillment.com to learn more.