Although order fulfilment is the process of picking, packing and despatching of sales orders to the customer, it’s not quite as simple as this may sound. Online sales have grown rapidly during the past few years, as shoppers continue to move away from the high street and, increasingly, to the internet for their purchases. In turn, this has placed enormous pressure on online retailers to maintain an efficient order fulfilment process to ensure complete customer satisfaction.
Online buyers’ expectations have evolved to the extent that order fulfilment has become a major factor in the quest to attract and retain customers.
What Is Order Fulfilment?
Order fulfilment is the final part of a sales transaction, ensuring the customer receives their purchases according to their expectations.
How important is order fulfilment?
All of the hard word and effort that goes into building an online business can be undone by a poor order fulfilment process. This is not the primary area expertise for most online retailers and certainly not the driving force which keeps businesses motivated and engaged. Yet order fulfilment is as important as sourcing the right products for sale and ensuring effective marketing activity to attract customers.
How does order fulfilment work?
When an online order is received and products need to be despatched, a notification, pick list or despatch note will be generated by the business’s order fulfilment software. This enables the picking and packing team to identify and select the required products from storage locations in the warehouse. The products are then QC checked and carefully packed, using appropriate packing materials to ensure safe and secure transit to the customer. Depending on the mailing service selected, labels are produced and applied to the outer packaging, ready for collection by the designated postal company or courier. Upon despatch, the software updates the product inventory with the new transaction and updates stock levels. This also triggers a notification to the customer that their order has been despatched.
What are the challenges of order fulfilment?
For companies that have a wide stock range, the ‘picking’ part of the order fulfilment process can be hampered if a robust stock control system is not in place. The ‘packing’ also comes with some challenges, especially when packing fragile products or items that should not be bent. Then there’s choosing the right courier who will look after your packages, ensuring that they get to your customer in the same condition as they left you.
The Order Fulfilment Process
There are numerous steps in the order fulfilment process, depending on the type of business, the products involved and the order destination:
Once received from the manufacturer or distributor, the products for sale are checked off against a delivery note and stored securely in a warehouse, storeroom or fulfilment centre. Each product has a designated unique number (SKU) and storage location, to help keep track of the stock.
Picking and packing
Upon receipt of an order, pick and pack operatives will select the correct items from the warehouse/storeroom and pack them carefully, using predetermined packaging materials.
In high-volume environments, the order fulfilment software connects to the designated mailing service via an API, to generate a unique tracking reference and produce a barcoded address label. This is affixed to the package and used by mailing companies to ensure correct delivery routing.
Once parcels have been checked and packed, they are collected by the selected postal or courier service. A business may use multiple mailing methods, depending on the package size, weight and destination.
For all international destinations, packages have to be accompanied by relevant customs information. This includes details of the goods being shipped, their commodity code and delivery duty payment status. In a professional order fulfilment environment, this will be submitted digitally when the mailing label is generated.
Upon despatch, customers are sent a confirmation email and/or SMS to confirm the package is on its way. The message includes details of the postal service use and any tracking information.
For domestic deliveries of small packages in the UK, Royal Mail is the preferred choice for most eCommerce sellers. They offer attractive pricing and exemplary performance for both tracked and non-tracked mail. For larger items, there are a range of couriers offering a great tracked service. Fierce competition in recent years has resulted in improved standards of service and reliability across the sector, with DPD just about holding on to the coveted pole position. Others are catching up rapidly, aiming to provide similar service levels at more even attractive rates. It’s always best to review available choices, in terms of pricing, reputation and performance, before committing to high mailing volume contracts.
International shipping routes can often involve multiple carriers. For instance, a scenario where a courier collects a package destined for the USA from a fulfilment centre, which is subsequently handed over to the USPS for final delivery to the customer’s residence. Various factors drive the adoption of such hybrid shipping approaches. A typical illustration relates to the USPS’s capability to reach even the most remote regions, a feat often beyond the reach of many other commercial carriers. In these circumstances, utilising the USPS for the last leg of delivery simply makes good logistical sense. Some of the more established international couriers, like DHL, provide complete door-to-door delivery, without engaging third party postal services.
Products returned by customers are processed upon receipt and pristine items are returned to stock. Where necessary, replacement items are despatched to the customer. The stock inventory level is also updated.
Challenges of Order Fulfilment
The landscape of order fulfilment presents a spectrum of hurdles, ranging from issues related to supply shortages and inventory control to disruptions in demand forecasting and logistical intricacies within the supply chain.
Running out of stock not only results in customer dissatisfaction but also tarnishes the overall customer experience and damages a brand’s reputation. Repairing such harm can be a Herculean task for companies. However, there are exceptions to this rule; customers tend to be more understanding if shortages and delays are attributed to widespread weather events, natural disasters or other similar unexpected occurrences.
Conversely, maintaining excessive inventory incurs storage and carrying costs while increasing the risk of items becoming obsolete before they are sold. Accurate prediction and careful planning of demand levels are crucial for maintaining sufficient stock levels without venturing into overstocked territory.
Timely and intact deliveries, along with undamaged goods, play a pivotal role in preserving a company’s reputation, future sales and profitability. Vigilant logistics management is, therefore, imperative to ensure a seamless shipping process, minimising the chances of mishaps from warehouse to the customer’s doorstep.
Supply chain management
Crafting a robust supply chain strategy entails weighing cost-benefit trade-offs concerning operational decisions. For instance, companies might opt for a sole supplier to gain cost advantages through increased purchase volumes and priority status, especially during periods of heightened demand. However, this approach can backfire if the sole supplier encounters issues like labour strikes, natural disasters, or supply shortages. Careful supply chain management encompasses the coordination of multiple activities within the supply chain, including purchase order management, inventory control, warehouse management, transportation management, and logistics software, to ensure the seamless flow of goods from the point of origin to the final destination.
Order fulfilment staffing
Maintaining consistently high standards of order fulfilment performance can be particularly challenging during busy periods such as promotional sales, seasonal peaks, Black Friday, etc. It’s important to plan ahead and make sure that skilled, trained, resource is available when and where it’s needed. This may involve working working longer hours, hiring temporary staff and prioritising orders on a day-to-day basis.
Sustaining Excellence in Order Fulfilment
The pursuit of unwavering excellence in order fulfilment performance becomes particularly challenging during periods of heightened activity, such as promotional sales, seasonal peaks or the frantic shopping spree that is Black Friday. The key to success lies in meticulous planning, ensuring that a skilled and adequately trained workforce is not just available but deployed strategically to meet surging demands. This often necessitates the adoption of agile measures, including extended work hours, the recruitment of temporary staff and the fine-tuned prioritisation of orders on a day-to-day basis.
Planning for peak performance
Anticipating and preparing for peaks in demand is akin to navigating a ship through treacherous waters. Successful businesses acknowledge the inevitability of these surges and take proactive measures to mitigate challenges. Advanced planning involves assessing historical data, market trends and past performance during similar peak periods. Armed with this insight, organisations can formulate comprehensive strategies that encompass staffing, logistics, inventory management, and customer communication.
The role of a skilled workforce
A skilled and adaptable workforce serves as the linchpin of peak performance. Well-trained personnel can swiftly adapt to changing circumstances, maintaining the precision and efficiency expected by customers. They understand the intricacies of order fulfilment and inventory management, ensuring that the right products are in the right place at the right time. In essence, they are the guardians of order accuracy and on-time delivery.
Adapting to the demands
During these surges, businesses often find themselves in a race against the clock. This race may require extending working hours, with teams working tirelessly to meet customer expectations. However, it’s not merely about working harder; it’s also about working smarter. Leveraging technology, automation, and streamlined processes can help maximise productivity, allowing the existing workforce to achieve more in less time.
Temporary talent influx
To bolster the existing workforce, many companies turn to temporary staff. These individuals bring fresh energy and agility, plugging the gaps in staffing requirements during peak periods. While temporary, their impact is significant, contributing to the seamless flow of orders.
Strategic order prioritisation
Order prioritisation becomes paramount during peak seasons. Not all orders are created equal and some may require expedited processing to meet tight deadlines. A sophisticated order management system can help identify high-priority orders and allocate resources accordingly, ensuring that crucial deliveries are made on time without compromising on quality.
Essentially, maintaining impeccable order fulfilment standards during busy periods is an intricate dance of strategy, skilled labour, and adaptability. Successful businesses recognise that these surges in demand are not obstacles but opportunities to showcase their commitment to customer satisfaction. By planning meticulously, deploying a skilled workforce, and embracing agile practices, they not only weather the storm of peak periods but emerge stronger and more respected in the eyes of their customers.
Outsourcing Your Order Fulfilment
Businesses with significant order volumes may operate an in-house warehouse and order fulfilment function to handle the fast and efficient processing of their customer orders. However, the requirement of dedicated premises and trained staff can detract from the core expertise and business rationale. Consequently many companies prefer to outsource their order fulfilment to a third-party fulfilment service, saving time and money.
Third Party Logistics (3PL) companies will handle the entire order fulfilment process, from warehousing to despatch and everything in between. It is their primary business.
Why Outsource Order Fulfilment?
Order fulfilment can help businesses in many ways. These include:
Reduced staffing costs
Outsourcing order fulfilment eliminates the need to hire and train new staff as a business grows. Similarly, there’s no need to take on temporary staff for seasonal peaks and sales events. This also saves time and money dealing with added PAYE and NIC implications.
Reduced storage costs
As a business grows, so will its stock levels – from holding larger numbers of each item of stock to potentially expanding the complete range. A third-party fulfilment company will be able to efficiently and securely store stock in their warehouses, using purpose-built software to track all all movements.
More time to focus on core business issues
Time not spent packing orders is time that can be spent on developing a business, sourcing new stock and progressing effective marketing activities.
Improved customer service
With a dedicated fulfilment operation, customers will always receive their goods on time and in excellent condition. The fulfilment company will ensure full order accuracy so that customers always receive the correct type and quantity of goods they ordered.
Complete inventory control
A progressive 3PL company has purpose-built software that provides real-time information and reporting on stock levels and customer orders. This presents a complete picture of what stock is selling, how customer orders are progressing and what returns have been received.
Order Fulfilment Specialists
For companies of any size looking for a third-party fulfilment service, Adstral can help. We tailor our order fulfilment services to suit you precisely. We can flex with you for sales events & seasonal peaks, adapting as your company grows.
Who is Adstral?
Since 2010, Adstral has become one of the UK’s best-known independent order fulfilment companies, building an enviable reputation for our client-focused order fulfilment services. We are experts in delivering cost-effective, multi-channel, order fulfilment for online retailers. Working with both trade and retail customers, we provide a high-quality and reliable services with attention to detail and guaranteed order accuracy.
We use specialist order management software, which integrates directly with all major eCommerce platforms and online sales channels. This enables us to pick, pack and despatch orders received up to 5pm on the same business day.
Why choose Adstral
We provide our clients with a bespoke order fulfilment service that’s not only tailored to meet the needs of their business but can be adapted as the business grows. We don’t charge a set-up charge or monthly management fees and our flexible order fulfilment services can be adapted at any time.
Goods are stored safely and securely at our large warehouse facility, where they are allocated a client-specific location to ensure that we keep track of every item of stock. Inventory levels are guaranteed with regular stock checks and we welcome client visits and audits at any time.
We also manage customer returns, ensuring all returns are processed and inventory updated within 1 business day of receipt.
If you would like to talk to a member of our team about your order fulfilment requirements, then please call us on 01793 725043. Alternatively, complete our online enquiry form and we’ll respond to you without delay.