A repository of acronyms, jargon, and useful definitions perfect for eCommerce founders & marketers like yourself.

Order Fulfilment

Order Fulfilment

Order Fulfilment is all the steps a company takes between receiving a new order and placing that order into the customer’s hands. Successful order fulfilment includes receiving, processing, packing, picking, and shipping an order to the customers on time. Keeping order fulfilment running smoothly and without errors is critical to customer satisfaction and a healthy warehouse. For this, you need to maintain your inventory accuracy and integrate with suppliers to get your organization back in the game.

Order Fulfilment Models

  1. In-House: The company’s employees become responsible for the overall order fulfilment  process. This is the best option for everyone with a low sales volume.
  1. Outsourced: Third-party Company Logistics(3PL) take care of the overall order fulfilment  process. The 3PL’s employees control the overall pick and pack services.
  1. Dropshipping: One of the most important advantages of the dropshipping model is that you don’t need to care about warehouse management issues as well as the facilities. This is the best option to reduce the overhead costs.
  1. Hybrid: The hybrid model assumes using two or more models together like dropshipping or outsourcing or in-house model for certain items and dropshipping.

The Order Fulfilment  process

  1. Inventory Handling: How your inventory is handled lays the foundation for a successful order fulfilment venture.

This involves:

  • Receiving inventory at your store or a warehouse.
  • Classifying and labeling products.
  • Sorting items into strategic groups.
  • Shelving products for easy selection.
  • Inventory storage.
  1. Inventory storage: Your 3PL will typically offer short-term storage at their fulfillment center. Some 3PLs may charge extra for long-term storage, with significant price increases kicking in after around 30 days, so you’ll want to know the terms of your contract before signing.
  1. Order Processing: This is the part of the order fulfillment process where you pick purchased products from the shelf and evaluate them for damage before packing them for shipment to the buyer. eCommerce businesses that work with an outsourcer, however, won’t have to worry about these menial tasks. Once they receive the order request, the fulfillment center will handle each step of order processing for you.
  1. Packing: From boxing the products to selecting the carrier, this step prepares the order for shipment.
  1. Shipping: Customers today are quite used to the fast two-day shipping methods. Many eCommerce businesses contact a third-party carrier to speed up the process and reduce their shipping costs.
  2. Returns Management: Along with creating a dedicated return policy, you will also need a system for receiving returns, replacing products, and refunding your customers. Automating this step.
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