Working With a Fulfillment Service

By | March 27, 2010

Have you considered working with a fulfillment service?  Many businesses, especially e-businesses, have turned to fulfillment services in order to keep up with their growing demands.  However, as with everything, there are both advantages and disadvantages that need to be kept in mind.

Advantages of Working With a Fulfillment Service

1.    Time – The number one reason that most people turn to a fulfillment service is to save time.  Many people who work from home can end up spending a majority of their time packaging and shipping orders, instead of expanding their business.  A fulfillment business is a great way to free up extra time to work on improving your business.

2.    Lower Material Costs – Since fulfillment services work with packaging materials on a massive scale, they can purchase these materials at bulk rates.  This lowers both their costs and yours.  It is also possible to lower your overall shipment fees because they can utilize their high transport volumes to use bulk shipping options such as freight

3.    Expertise – Fulfillment services have proven especially useful if your business does a large amount of shipping outside the country.  They not only know the correct way to address packages, but also the best couriers to ship outside the country.

4.    Space – If your products start to take up a lot of space, then you may quickly need to upgrade your storage capacity.  Using a fulfillment service eliminates your storage needs.  They will store all of your products, which eliminates any inventory expenses that you may occur.

Disadvantages of Working With a Fulfillment Service

1.    Special Items
– Fulfillment services rarely, if ever, provide special packaging for fragile or odd-shaped items.  This means that there is a higher chance that your products will be damaged during shipping.  If your items need special attention, then a fulfillment service may not meet your needs.

2.    Control – Some fulfillment services will prioritize their larger accounts over smaller ones.  This means that if you are a smaller business, there is a chance that your products will be shipped out slower than they need to be.  When you ship products for yourself, you have complete control over where and when your products are shipped.

3.    Loss – Most fulfillment services do not do anything to reimburse you for lost goods.  This means that there is a chance that your products could become lost and nothing will be done to reimburse you.  While this is a problem by itself, the issue becomes compounded if you believe that products are available to be shipped, when in fact the fulfillment service has none.  This will create costly delays and can kill your customer service over time.

4.    Cost-Ineffective – If you are selling only a small amount of products every month, it is possible that the monthly costs of using a fulfillment service will be greater than the actual shipping costs.  The total cost of using a fulfillment service must always be closely monitored.

Fulfillment services have become a great option for variety of different business, however there are some potential drawbacks that need to be kept in mind.

Read fulfillment service reviews to help you find the right service for your business needs.

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