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Order fulfillment appears to be a simple and easy process. If everything goes as planned, the customer’s order will arrive on time, undamaged, and with the correct item(s). While the eCommerce order fulfillment process involves the customer in the supply chain with the end result, the promise of a sale combined with the possible problems of order fulfillment is a goal and a challenge for any organization. Your eCommerce order fulfillment process is crucial to the success of your business. It has an impact on both the customer experience and the efficiency of your operations.
So, how can your e-commerce business accomplish this trifecta? And how can you make the process from order placement through delivery more efficient?
1. Understand your order fulfillment process
In order to make improvements to your eCommerce order fulfillment process, the first important step is to understand your order fulfillment cycle. One of the first steps in enhancing your eCommerce order fulfillment process is to calculate your order fulfillment cycle time, as it will provide useful information about the present effectiveness of your order fulfillment process. It’s critical to monitor this indicator because a quick fulfillment process might impact your customers’ happiness, which ultimately affects the profitability of your online business.
In order to understand your order fulfillment process and the time required. You need to pay attention to the following :
- Promised customer order time
This is the projected order fulfillment time that you inform your customers, and it serves as a useful benchmark for the KPIs of your order fulfillment process.
What is the actual cycle time for client orders? Does it meet the expectations? The average time it takes for a consumer to receive a product after making an order on your website should be as short as possible.
- Order fulfillment cycle time
If the raw materials are not in stock, what is your supply chain cycle time? This is how long it takes to fulfil an order that consists of the cycle time plus the time required to order and receive supplies.
Therefore, when you calculate your actual order fulfillment cycle time, the most commonly used formula for calculating order fulfillment cycle time is:
Total cycle time for order fulfillment=Source time + Production time + Delivery time
Source time: From the moment a customer places an order online to your company realising that it has the necessary raw materials to begin processing the transaction.
Production time: The time it takes to manufacture, complete, and pack the order.
Delivery time: The time it takes for an order to be shipped from your warehouse to your customer’s designated delivery location.
In general, the shorter the order fulfillment process time, the better. Once you have an understanding of your order fulfillment cycle time, you can begin to explore areas for improvement, such as increasing efficiency through automation or something similar.
2. Demand seamless integration is the first step
If your eCommerce business does not manufacture the products you sell in-house, or if the goods are most likely sourced from numerous distributors, warehoused, and then drop-shipped to your clients. Then it’s critical to incorporate seamless links with your suppliers via an order management system (OMS) that interacts easily between your systems and those of your suppliers.
3. Enable order transparency from end to end
Your order management system (OMS) connects you to your suppliers in real-time. You must now ensure that you have the system in place and have the complete transparency of your supply chain. That means you and your suppliers should be able to access the same system, catalog, inventory fulfillment, and order fulfillment procedures – to see what inventory is available, in what quantities, and where they are located.
On the other hand, your e-commerce customers who are browsing your website should be able to see whether an item is in stock and, if quantities are limited or quantity matters, how many units are available. This clarity is referred to as end-to-end visibility, and it is critical for both customer pleasure and an accurate order fulfillment process.
4. Use the best carrier
Now that your product is great and your back-end processes are working well, it’s time to tackle the primary stumbling block of e-commerce order fulfillment: shipping. The bottom line is, that if your shipper is less than outstanding and/or consistently underperforms, your consumers will vent their frustration on you as well as on your company’s reputation, instead of on the shipper.
Remember to audit your current carrier on a regular basis: do they provide real-time, precise order tracking? Is there a recent increase in late shipments, delayed shipments, lost shipments, forgotten shipments, or damaged deliveries at your shipper? If this is the case, it is necessary to invest time and resources in selecting a new and better shipper to satisfy your order fulfillment needs.
5. Enable order management based on exceptions
While we’re on the subject of order shipment, end-to-end visibility enables exception-based order management. What does this imply? Essentially, instead of simply telling customers that their goods have been delayed and also risking negative customer experiences, you can automatically upgrade shipping options to meet your original delivery guarantee. It’s true that exception-based order management will cost you more in shipping, but it will spare you the stress and financial consequences of furious consumers and lost business. This automated procedure can also enhance brand loyalty and the chance of repeat purchases.
6. Choose your warehousing locations wisely
Today’s e-commerce shoppers expect their orders as soon as possible. Your company can meet this desire in two ways: choose warehouses and shippers that can match your needs for speedy picking and shipping (through expensive air transport), or store products in multiple warehouses spread around your delivery area and hence close to your customers’ homes to assure speedy but low-cost ground shipping. Ideally, use sophisticated shipping algorithms to help find the best shipping option so you don’t overspend but also don’t under-deliver.
7. Provide real-time order status for your customers
You should maintain constant contact with your customer throughout the order fulfillment process. Here we are not talking about a simple “Thank you for your order” email”, but a real-time, on-demand notification about order status, from order received, and in process, to order shipped and shipment delivered.
8. Handle returns and refunds like a pro
Returns are very common for all businesses, around 30% of online purchases are returned. Refunds are required, and it is a necessary component for every business, while not every business approaches it positively and efficiently. It’s important to be explicit about your return policy, but also create efficient processes for handling returns, managing reverse logistics, and issuing refunds.
Consider your order fulfillment process to be customer satisfaction fulfillment, it is your responsibility as a retailer to make your online shoppers happy throughout the ordering process. Working with vendors who accept returns, charge no restocking fees, and can handle refunds and replacements is preferable. Alternatively, working with a 3PL logistic to help you better handle returns and provide customer support.
SPExpress has the right level of expertise to offer exceptional supply chain solutions that are custom-tailored for your business, including 3PL services, with warehousing, distribution, and eCommerce order fulfillment services in Canada. Get a free quote from us today.
9. Set safety stock
To maintain a speedy and effective order fulfillment process, always keep just enough stock on hand so that you are never at risk of running out. Setting a safety stock is one method for accomplishing this. When you keep a safe number of products in stock at all times, you never run out and can always fulfill orders. The goal is to absorb demand fluctuations, such as sudden and unexpected surges in order volume. Use statistical approaches that focus on measuring spikes rather than typical consumer demand to calculate your safety stock numbers. However, if your company is a startup or your product demand is limited, such methods may be hampered by a lack of data points.
10. Automate your order fulfillment processes
The pinnacle of an efficient order fulfillment process is automation. While many eCommerce businesses would manually enter data into each system and spend the majority of their order fulfillment time performing repetitive chores. This not only reduces the efficiency of your staff and your company as a whole, but it can also lead to poor quality work owing to the repetitive and simplistic nature of the job.
Integrating and automating your order management allows orders to be generated automatically, bills to be sent when shipping, and reminders to follow up with customers to ensure customer satisfaction and repeat sales. Your employees will only need to enter data once if you engage in automation. In addition, automation minimizes operational expenses and considerably eliminates the chance of human error while also offering sales opportunities.
With an inventory and order management system in place, you will have greater visibility into your overall company processes. You may then analyze each of these and find ways to speed them up faster. Another option is to employ barcode scanners to rapidly and easily enter inventory into your systems as fresh product batches arrive at your warehouse.
Order fulfillment Process efficiency is critical for business growth
eCommerce order fulfillment can make or break a company. eCommerce businesses should always strive to create a more effective and streamlined procedure to guarantee that their operations run smoothly and their consumers are happy.At SPExpress.ca, we understand how important order fulfillment is. SPExpress has assisted various eCommerce businesses in improving their order fulfillment strategies to generate better customer experiences by providing skilled warehousing and distribution center services and processes. Contact us today to find out how we can help to improve your eCommerce order fulfillment process.