There are many services available to store your
products and fill customer orders on your behalf. Rather than hiring someone to
come to your studio and fill orders, you hire the fulfillment service to accept
large shipments of your product and pick, pack, ship, and send notifications to
your customers from a separate warehouse location. There are a growing number
of ecommerce fulfillment companies offering such services. Because fulfillment
companies hire dedicated workers to pick and pack orders and receive volume
discounts on shipping costs, they can potentially fulfill orders more
efficiently than each individual business can. However, after considering the markup
of these costs, the final cost to you is often the same or more than fulfilling
directly. Some popular fulfillment services in the USA are ShipBob, FedEx Fulfillment,
Amazon, and WhiteBox.
Fulfillment service costs
The direct monetary cost of using a fulfillment
service includes setup fees, storage fees, per-order costs, inventory receiving
fees, and more. There is also the cost of losing an opportunity for you to
interact with your customers through the ‘unboxing’ experience. Because of the
time needed to send product to the fulfillment service, you would need to keep
more inventory on hand at the fulfillment center than you would when filling
orders directly from your studio.
Fulfillment service benefits include the removal of a large
space-consuming and time-consuming activity from your operations so you can
focus on other items. If you are low on space at your studio, you can send
product as it’s produced and use all the available space for production activities.
If you don’t yet have a production facility, you can rent temporary space (at a
shared commercial kitchen perhaps) and produce enough inventory to send to the
fulfillment center, then manage your business from home. This would allow you to
scale up without any dedicated studio space at all.
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