How To Reduce eCommerce Fulfillment Costs

When eCommerce businesses want to know how they can reach the next level, there is invariably one competitor to whom they look: Amazon. The online store giant offers elements that are tricky for smaller businesses to match – with same-day deliveries on some items, and 48-hour turnaround on a wider selection of goods. At the present time, their same-day service is not something practised by all eCommerce businesses, but it is estimated that 75% of such businesses offer it, or soon will.

The truth of the matter is that, with such a major player offering delivery at this speed, it is going to be expected that others follow suit in their order fulfilment. If you run an eCommerce business, this means that you face the challenge of trying to get as many orders out, as quickly as possible, and keeping costs from spiraling out of control.

How Do You Keep a Lid on Costs?

If you want your business to move with the times, then it is a necessity to offer an effective delivery solution. This means streamlining your process from start to finish – improving software on the ordering side of the business, adding capacity and improving response times in your warehouse. Partnering with the likes of ShipJoy eCommerce fulfilment can be the best bet for a business without the long reach of an Amazon.

How Much Should Fulfillment Cost?

On average, 18% of the cost of online sales comes at the fulfilment stage. That’s nearly a fifth of the cost, but it is not too much for an eCommerce business to remain profitable. If however, that amount is higher within your business, it can be a cause for concern. In truth, you need to be including fulfilment costs at an earlier stage of the accounting process than most businesses do. 

The simple truth is that fulfilling orders costs money – when you acknowledge that, you can aim for savings, and set prices and targets more realistically. Include the costs for fulfilment services such as ShipJoy eCommerce fulfilment in your sales costs. Leaving these calculations out of your accounting strategy at this point leads to spiraling costs which you’ll have to face later.

How To Get The Best Results

In keeping with the accepted wisdom that mistakes made early on end up having a distorting impact as a process continues, it is vital to keep in mind the importance of operational efficiency at all stages of your fulfilment process. It’s all the more important, in consultation with the likes of ShipJoy eCommerce fulfillment, to ensure that you’re making the right decision every time you come to a Yes/No question.

You should, for example, clamp down firmly on waste – both in materials and space. The more extraneous packaging you use, the more you are spending every day on fulfilment; and the more space you will be taking up in fulfilment vehicles, meaning a reduction in fewer items per consignment. In addition, have more than one go-to carrier with whom you work – some will work better for a lot of short hops while others will fare better on a long haul. 

Your fulfilment strategy needs to take account of all the ways you can lose money through poor decision-making. You face different challenges than the billion-dollar eCommerce giants – but if you meet them with the right decisions, you can achieve impressive results.

For these reasons are more, ShipJoy is the choice for intelligent eCommerce brands to profitably grow their businesses. Contact us today for more information about how we can help your company.