One question I get asked all the time by customers who are thinking of opening an online store is, “How should I fulfill orders?”
Many eCommerce businesses start out as bricks and mortar stores before deciding to go online. They already have warehousing and distribution systems for their store(s), so it’s not a big leap for them to sell direct to consumers online.
Before I go on, it’s been very interesting to watch these large online stores grow to a point where quite a few outperform the same brands’ retail flagship stores.
One retailer we launched recently had hoped their online store would sell $100,000 in the first year. When the online doors were thrown open they knocked that target over in just over one month.
Most of the larger players we deal with have created a separate business for online, and the online channel has to perform just like a physical store.
They create a separate area in the warehouse with its own stock and pick and pack orders as they come in. Most use Australia Post eParcel service (which I’m hearing really good things about and it offers tracking), Australia Post Express Post, Australia Post regular parcel service (which in my experience is about as fast as express and a lot cheaper!), or a regular courier service such as DHL, StarTrack, etc.
When it comes to international shipping, this is where it gets tricky for us Australians.
The most inexpensive option is to use regular Airmail. Personally, I’ve been using this for my own online store for over a decade and it’s been amazingly reliable. There was a hiccup late last year when every parcel over 150 grams was x-rayed (just before Christmas), which really slowed things down, but for the most part it’s reasonably quick.
The downside is there’s absolutely no tracking, and this is something International Customers expect these days thanks to the likes of Amazon and other large online retailers who do offer parcel tracking. Customers love it.
Of course, another option when shipping offshore is to use an international courier service, but this can be prohibitively expensive unless you’re a big player and have been able to do a volume discount with a courier company.
If you ship a lot of products into the United States or Canada the third option is to ship your goods on a pallet to a dedicated fulfilment centre in the US.
For a few years now Amazon has been offering an appropriately named service called Fulfilment by Amazon. This enables you to literally collect orders on your own website, send them to Amazon who pick, pack and ship at very reasonable rates. Storage in their facility is also quite cheap.
There are some compelling advantages using Amazon’s service:
1. People in the US trust Amazon and you get good brand association between your brand and Amazon’s.
2. As I mentioned a minute ago, they’re fast and cheap and it makes sense that your products are physically closer to your US and Canadian customers.
3. There’s less environmental impact. You’re not shipping individual items all the way from Australia all the time.
4. Fulfillment houses generally handle all customer enquiries about shipping and the dreaded, “where’s my parcel?” question. They also handle all returns.
5. Finally, using a specialised fulfillment house enables you to focus more on your marketing and business and not have to worry about fulfillment.
So how do you ship locally and internationally? Please share your experiences!
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Chris Thomas heads up Reseo, a search engine optimisation company which specialises in creating and maintaining Google AdWords campaigns and Search Engine Optimisation campaigns for a range of corporate clients.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
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