The company that handles your retail distribution is not necessarily the best candidate to fulfill your eCommerce orders.
While B2B and B2C warehouses look similar from the outside, inside it’s a whole different story. The people, processes and technologies required to get B2C orders out the door vary greatly from those required for wholesale or retail distribution. If most of your orders ship direct to consumers, you’ll want a B2C fulfillment company that understands this channel.
What should you look for in a B2C fulfillment company? Here are a few of the most important things.
STRONG LABOR PLANNING FOR B2C FULFILLMENT
B2C fulfillment is more labor intensive. Retail shipments might include a full pallet of an SKU containing 18 cases with 36 pieces per case. One forklift operator can grab those 648 units with one pick. In B2C fulfillment, those units can potentially be spread across 648 different orders and 648 different picks. It’s why labor is the biggest warehouse-related expense for online sellers – whether you outsource to a 3PL or do it yourself. Look for a B2C fulfillment company that understands how to do labor planning. That starts with better sales forecasts for online businesses. If your current partner is not pressuring you for accurate forecasts, you’re likely paying too much for labor. Poor or non-existent forecasts result in inaccurate labor plans that, in turn, lead to costly overtime or last-minute use of untrained temporary workers. On the other hand, if you can supply your B2C fulfillment company with a constantly updated estimate on volume expectations linked to seasonal buying or promotions, then the 3PL can make sure you have just the right number of associates to handle the volume, with no overspending.
STRONG PARCEL SHIPPING MANAGEMENT
Parcel shipping is your largest fulfillment expense. One way to reduce those costs sharply is to ship under the parcel contracts negotiated by a B2C fulfillment partner. Such companies negotiate with carriers using their aggregate spend as leverage. However, if the 3PL ships primarily to retailers, it simply won’t have the buying clout with UPS, FedEx and other parcel carriers to command a deep discount. But 3PLs that specialize in B2C could score discounts in the 40% range for heavier packages and significant, but lower, discounts for lighter packages. By piggybacking on these rates, you move up the food chain with the carriers and secure rates similar to your larger competitors.
A COMMITMENT TO PROCESS
B2C fulfillment often involves repetitive tasks for packing an order that need to be completed according to very specific, customer-defined steps. If those tasks can’t be automated, they need to be meticulously documented to maximize accuracy and productivity. Frankly, some 3PLs are more process-oriented than others. When vetting B2C fulfillment companies, ask to see documented SOPs with pictures, examples, and even videos that they use to train warehouse associates on the process. If they can’t produce such SOPs, they may lack the kind of process discipline you need.
A FULFILLMENT NETWORK THAT SUPPORTS RAPID DELIVERY
In retail distribution, the focus is less about speed and more about predictability – getting orders delivered by the retailer’s Request Arrival Date (RAD). In contrast, consumers have been conditioned to expect orders in 2 days. Such service levels require you to put inventory as close as possible to your customers. Certainly, a B2C fulfillment specialist with a nationwide network of fulfillment centers gives you an ability to expand your warehouse network as service level demands increase.
AN ABILITY TO CUSTOMIZE
Many specialists in B2C fulfillment are able to build complex orders at scale. Amware, for example, builds thousands of kits daily for etailers and direct sales companies – kits that could include up to 10 or 20 different products. This takes know-how and systems capabilities that B2B-focused providers may not have, such as:
- accurately managing inventory as products morph from units to kits
- batching of similar orders to boost efficiency and accuracy
- automatically alerting the packer when certain orders require an insert, such as a flyer offering a special deal on a complementary product
Those are just a few examples of how a B2C fulfillment company supports customization at scale.
AN ABILITY TO SCALE
You’ll want a partner with an eye toward long-term planning – a 3PL that can help you scale fulfillment operations to support a 3- to 5-year growth plan. That involves looking at long-term sales projections and making recommendations on how automating picking and packing processes can reduce labor costs. Some of these projects take considerable time and money, so it’s important to proactively anticipate future needs in enough time to build the back-end infrastructure you will require. The right B2C fulfillment company will have the engineering and operations expertise to develop a recommendation and ROI analysis. Ask potential providers to share examples of how they’ve helped growing B2C businesses scale fulfillment operations.
Multi-Channel Fulfillment: The Best of Both Worlds
Most warehousing and fulfillment companies started in B2B retail distribution. Many are now making the shift to handle B2C fulfillment, as well. But beware of 3PLs – including some large, national providers – that lack B2C fulfillment experience and do not understand the operational nuances of large-scale pick and pack fulfillment.
If you sell through multiple sales channels, your best partner may be a multi-channel fulfillment specialist that has legacy experience in retail distribution, but now has B2C fulfillment as a prime strategic focus, not a sideline. They combine all the B2C fulfillment company capabilities covered in this article, plus an understanding of bulk distribution processes and retailer routing guide requirements.
If you’re looking for one fulfillment partner for all your sales channels, contact an Amware specialist to start a discussion.