Is customer service everything to your ecommerce store? If so, then remember 53% of all customers at checkout want to know two questions: What is the price, and when will I receive my product?
While price is important, if you truly want to create raving fans for your company. Focus on how you can create tremendous value for your customers. The best way to do this is to deliver the products they want fast with extras in the packaging that makes them know you care.
To do this successfully, you need a clear and concise strategy. Using the ideas below, we want to help you organize your fulfillment strategy.
7 steps to master your order fulfillment
Step #1: Get into a consistent routine.
Benjamin Franklin used to end his day by asking, “what good have I done today?” It is like he peered into a colonial crystal ball and saw what every good ecommerce store owner needs to do everyday to ensure they get the most out of their efforts.
To help you as an ecommerce entrepreneur get more out of your order fulfillment process, it is vital to stick to a consistent schedule.
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On average, an entrepreneur spends around 51 hours per week working on their business. While 1 in 5 entrepreneurs peak out around 60 plus hours. Spending that much time fulfilling orders can be exhausting.
Instead, discover what routine works best for your clients and yourself. Test it out, record your results, and improve upon those results.
Three things you want to record daily are:
- The number orders you fulfilled.
- The number of products you have left.
- The number of materials (per type) you need to re-order.
Next, write down your process, so you can either automate or remove inefficiencies.
For example, Mike Dimartinis’ runs EverestBands.Com and LuxWatchStraps.Com. He schedules two hours every day from 3-5 PM for fulfillment, including packaging all the products sold that day, printing labels for the content of the shipment, and handwriting “thank you” notes.
He understands that he does his best work for customers during this time. Then when he is done at 5 PM, he can go home and spend some quality with his family.
Everyone has a different routine. Review your results like Mike has to determine the best processes for fulfilling your products. Then write your processes down (create a standard operating procedure), so you can train a third party fulfillment company or employee to do the work for you.
Step #2: Define what you will and will not ship.
Ever receive an order from Shanghai, China? Did the buyer expect to pay the same amount as the person you were shipping to in San Francisco?
Strange, but true. Buyers do not know your shipping policies until you tell them.
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Flint and Tinder founder Jake Bronstein said, “We started with four styles, in five sizes, in seven colors…that’s 140 different variants of just the underwear,” says Bronstein. “What if green briefs don’t sell in small? Or 2XL boxers in red? It was silly to have so many options when cash-flow is ultimately what kills businesses dead.”
New ecommerce stores should avoid growing too fast for their britches…pardon the pun. They need to focus instead on having a few products they can sell and ship before expanding and making the order fulfillment process wonky.
Even better when your products have naturally defined limits on what is possible. Take Piast Meats & Provisions Inc.
They ship to customers across the United States. While their meats are good, more than likely they are not good enough to last an overseas trip that might take a few days.
Imagine 3-5 day business days waiting for the meat shipped to your home in Tokyo. That would leave an aromatic smell that would be hard to forget.
For new businesses, the best way to set clear rules is to start with a few products. As Henry Ford once said, “They can have any color as long as it’s black.” He understood that starting out in business, it is more important to get one product right then to sell to everyone.
Step #3: Prepare for “rush hour”.
Samantha Lockwood, the owner of Fleurings said, “Always make sure you have plenty of inventory in stock when you have big media coming your way. You don’t want to be back ordered if possible.”
This is essential for any ecommerce store. Nothing worse than getting media attention, and not being able to keep up with the demand.
Therefore, you must take continually check the following four items:
- Keep on top of your inventory on a daily basis. This is why it is not good to start out as an ecommerce site with too many products. Get really good at fulfilling one product. Then add another one and do the same thing.
- Have the right team in place to help you with your logistics and fulfillment.
- Use tracking software to keep records of your stores inventory. The Shopify apps we discuss in idea #7 provides you with the tools you need to integrate your shopping cart with your fulfillment.
- Predict the amount of orders coming through. You can do this by tracking your conversion rate, then estimate the amount of traffic you’ll get from any media or viral attention (make sure you keep your estimate conservative). Then multiply the amount of potential traffic with your conversion rate to figure out the amount of potential orders you may get.
(conservatively) estimated traffic x conversion rate (based on traffic source) = # of potential orders to prepare for
Take Crossfit equipment store Fringe Sport. Over the past few years they built a team to deal with the growth of their ecommerce store from $100,000 in 2011 to $3 million in 2013. To think that it all started in 2010 with the sale of one product: $2,000 worth of gymnastic rings.
Fringe Sport grew extremely fast adding new products as they grew. To do deal with the demands of new orders coming in the founders first quit their jobs to do this full time and then hired personnel.
Additionally, they used Shopify plugin Ship Station to connect their ecommerce store with their inventory.
Next, they started to use the “bricks and clicks approach with their product to fulfill increasing demand.They now have two new showrooms that bring in 35% of their sales, while the remaining 65% comes from their online ecommerce store and their wholesale/dropshipping program.
Once the team, products, and inventory management is in place they tested their process to continually improve.
Step #4: Set up a dedicated fulfillment area. To be as good as a fulfilment center, you need all the tools in one specific area. Otherwise, it is challenging to have a clearly defined strategy for fulfillment.
Nicole and Greg Horgan have a dedicated workshop where they handcraft each of the leather creations they sell on Four Robins.
A dedicated space ensures you can consistently fulfill your products for your customers. Stop running around like a chicken with your head cut off trying to remember what you did last time you packed an order. Have your assembly instructions and materials in one place, so you can ship the products without unneeded delays.
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#5 always improve your process. No product and/or process is ever perfect. The moment you believe your process is perfect is the moment when your competition swoops in and conks you on the head for being presumptuous. Spend time improving your process.
His team made an mistake early on of creating products without considering customer preferences or manufacturing guidelines.
When it was a bust, they realized they could learn more in the future by asking their customers and vendors for help.
Today they “find a way to get feedback from customers as quick as humanly possible” in their manufacturing process by asking for their opinion and ideas.
Another route is to think about what you want. “The routines and activities you do are the same as everyone else. You need to find something you do during the day that is annoying or could be improved upon,” says Patrick Lehoux, creator of the Kinkajou.
His company helps you turn household bottles into various decorations, so you can recycle the bottles uses for your family, instead of throwing them out in the garbage.
The process for the entire operation stemmed from his aversion to waste. Patrick understands his green friendly customers, because they are like him.
Think about order fulfillment from your clients perspective, and ask what would I want in this situation? Is it free shipping or fast shipping that matters more to me? Then realize that you are your ideal client in many respects.
When you understand what they want, you can design an order fulfillment process around their needs.
Step#6: Work with quality partners.
Diogo Cruz states, “People hate to wait for their purchases and they want to know where their items are, all the time. Pay a little more for a good shipping partner, because it will pay off in the future.”
Most companies want to save money. As depressing as this might sound; however, cheaper does not always mean better when shipping goods to your customers.
Yet, take this example. You want to ship a product from Los Angeles to New York. Which option from the chart below is best for you?
In this example, the package weighs two pounds, and is approximately the size of a UPS Express Pak or USPS Flat Rate Box. Comparing the major three shipping companies (FedEX, UPS, and USPS) we can start comparing who would be the best shipping partner in the country for overnight, 2-day, and 3 day delivery.
As you can see above, the United States Postal Service has lower rates compared to FedEx and UPS. However, their price comes at a cost. For example, their standard rate mail states deliveries can take up to a week for packages.
Conversely, UPS and FedEx ground can get this to you within 5 days of the delivery time for the same price.
While the difference might be small, it could be the difference between a purchase and a lost customer for your ecommerce store.
Study who is your best partner for shipping and fulfilling orders in every aspect of your business. The more research you do, the more you can build a viable ecommerce store.
Step #7: Incorporate Shopify tools to ensure all your processes are streamlined and tied in together.
Next, use Order Management & Inventory Management to use pick and pack lists, so you know the right goods and extras go into each order placed on your site. Nothing worse than sending the wrong goods to a customer…get it right the first time so you save face and money.
In order to be organized, you must have the right tools for your business. Shopify helps you keep these tools all in one location.
Most customers do not expect the world from you. What they do expect is that you deliver their vision of the product to them as you presented it on your store.
This means how you ship a product and when it arrives are crucial steps you take to ensure a quality relationship with your customer.
With so many clients now concerned about when products ship to them, it is good to have your fulfillment team prepared to wow the customer with your deft skills and quick delivery times that have them coming back to your ecommerce site for more.
For those of you who do your own order fulfillment, what have you found to be your biggest challenge?