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The important thing to remember about outsourced order fulfillment is that you get out of it what you put into it. Actually, thanks to technological innovation and modern logistics management systems, you’ll more than likely get quite a bit more.
But if you make the effort to find the right service provider for your business you’ll see the savings begin in almost no time. In fact, your savings will grow and gain momentum as you business grows, too.
You’ll Save Money In Warehousing Costs
When you outsource you consign all your inventory acceptance, storage needs and warehousing fulfillment, and climate control needs to the fulfillment company.
This service provider receives your product inventory directly from the manufacturer or other source so that you no longer have to deal with product deliveries and arrivals. Instead, the inventory shipments go directly to the fulfillment company’s climate controlled warehouse and processing center.
You save money because you no longer need to pay for independent warehousing space, train and pay a warehousing staff, or for the numerous miscellaneous costs associated with keeping your own inventory safe and secure.
You’ll Save Money In Labor Cost
Fulfillment service centers also hire and train their own staff, who specialize in fast and efficient processing of customer orders. You don’t have to train or equip your own staff thanks to the benefits of a service provider. You’ll save money on payroll taxes and payroll servicing, and you won’t have to worry about turnover or federal workplace safety compliance.
You’ll Save Money On Customer Returns and Refunds
With such an expert staff working to process and ship your orders, you’ll see a drop in customer complaints and questions, with a similar decline in demands for product returns or cash refunds. Greater efficiency and better service times means more profits for you, and you’ll realize them once you start outsourcing your order fulfillment to a third party service provider.
What All This Will Cost
Fulfillment service companies typically charge a set percentage of each product shipped and processed. This percentage serves as their service fee, but also gives them a powerful cash incentive to successfully ship and process as many products as possible on behalf of their client businesses, the better to increase their own profits.