The term fulfillment is most often used in ecommerce. It represents the process of handling orders, which includes receiving, packaging and shipping. It is necessary for any ecommerce, but it’s also a large part of many other types of business. Even before the internet and commerce stores, there was a possibility of ordering a product over the phone, and those companies required fulfillment strategy as well.
Types of fulfillment systems
Depending on what is being sold, there are several types of fulfillment:
subscriptions – paying in advance and receiving a magazine or other publication regularly for a time period
memberships – the proof of belonging to some group; being its member
continuities – similar to subscriptions, but refers to any kind of merchandise
catalog merchandise – goods represented in the catalog
fundraising – raising money for a cause
Fulfillment purposes
Fulfillment has very important place in the retail industry, and especially in the ecommerce section. In general, it covers almost every back process that customer can’t see: from receiving an email or phone order, to finding product, packing, labeling, shipping and tracking shipment, and, eventually, receiving feedback and customer’s satisfaction. Its main purposes are:
receiving the order and delivering the product to the person who bought it
maintaining customer records
sending invoices and receiving payments
responding to eventual complaints and solving customer problems
to keep the record of purchases in order to develop marketing strategy
Outsourcing fulfillment
Running an ecommerce business can easily be done from home. The only necessary equipment is the computer and internet connection. But what about the storage room? When an online store becomes popular, there is a large amount of orders that need fulfillment, and many product that should be in stock at any moment. To avoid additional storage costs, outsourcing the whole fulfillment process may be a good idea. It has several advantages:
not having to rent or buy a warehouse can save a lot of money,
handling each individual order requires a lot of time that can be saved with outsourcing,
big fulfillment companies usually buy packing and other material in bulk which means they get it for less money; because of that, they are able to offer better prices for companies that need their fulfillments outsourced.
Big fulfillment companies are likely to invest in some kind of organization system and make the whole process faster, more automated and reduce the mistakes
