What is Order Fulfillment?
Order fulfillment is the process of handling, preparing and delivering sales orders to customers.
Larger and more established companies are usually well-equipped to handle this themselves, whereas a smaller business may need to outsource order fulfillment through dropshipping or third party services.
Order fulfillment process
There are more steps involved in ecommerce order fulfillment and shipping to customers than often meets the eye. You’ll need to:
- Store products and inventory in a warehouse and put a solid system in place to pick the necessary items for each order.
- Pack all products in an order together in the best fitting envelope or box.
- Weigh the packed shipment and choose an appropriate shipping provider.
- Print out all relevant invoices, packing slips and shipping labels before sealing the package.
- Drop each package off at the required place or have them all ready for courier collection by a certain time.
- Mark each order as shipped on the relevant marketplace or sales channel and notify the customer via email.
- Manage returns should an order arrive damaged or a customer decide they no longer want their purchase.
Order fulfillment models
Taking care of this process is usually done through one of three main order fulfillment models. These are:
- Dropshipping. Where a retailer doesn’t see or handle goods themselves, but instead purchases from a third party to pack and ship to customers as new orders come in.
- Third party logistics (3PL). Where a retailer owns and controls their own inventory, but sends it to a specialist third party fulfillment service to store and ship to customers.
- Self-fulfillment. Where a retailer has their own independent storage and order fulfillment operation in place.
Retailers choosing the self-fulfillment option will likely benefit from implementing dedicated shipping software into their business. This should help automate as much of the ecommerce order fulfillment process as possible and provide a system in which to manage all the steps in one place.
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