The decision to outsource order fulfillment for your online store is a big decision – especially when you sell products like electronics and accessories. Here are four things to consider when evaluating a potential fulfillment and shipping partner.
1: Accurate inventory management
For the most part, electronics don’t come cheap. Companies that work with something as valuable as electronics will need to maintain a very precise and detailed inventory. Too much product hurts cash flow and operating margins. Too little means delayed deliveries or even lost customers. However, detailed and thorough inventory management can be a time and resource consuming process.
Outsourcing your warehouse and fulfillment to an experienced 3PL with the proper WMS technology will provide the data your business needs: accurate on-hand counts and product availability for any level of product demand.
2) Procedures to minimize damage from handling
With sensitive electronics susceptible to temperature, moisture, or jostling, there is always potential for loss and shrinkage. In truth, some damages are inevitable, especially when you’re dealing with such fragile items.
This is why having procedures in place to minimize damages is important. Third party logistics partners can prove very useful in this regard, many having specific experience and specialized training for personnel regarding the handling of sensitive equipment. Many can also help troubleshoot potential hazards that can lead to product damage.
3) Security and reporting
When dealing with high price items, shrink and loss prevention becomes even more important. Even just a few missing items can quickly rack up significant costs. Look for a fulfillment partner with strong protocols for security and reporting.
Another idea is to look for a partner that offers bar coding, which is an effective tool for improving both warehouse efficiency and the accuracy of on-hand quantities. Bar coding systems can verify that the correct item is being picked or put away, update inventory levels quickly and accurately, and eliminate many keying errors.
Cycle counts, when properly executed, are another key process for improving inventory management.
4) Returns management
In retail there will always be returns, and this is no different with electronics. For most sellers the cost of processing a return can be 2-3 times that of an outbound shipment. Working with a 3rd party logistics company will usually reduce those costs and provide a more efficient reverse logistics process. Done right, returns management will change from being a pure cost center to a source of improved profitability and enhanced customer service.
Working with an experienced fulfillment company is a smart and direct path to building a more profitable online business. Make sure you choose the right partner.