Knowing the best practices for identifying the right ecommerce warehousing solution for your business can help you optimize your supply chain. Whether you are doing it in-house or outsourcing to a 3PL for supply chain solutions, identifying the variables of a suitable ecommerce warehousing solution will benefit you and your company over time.
What Is eCommerce Warehousing?
eCommerce warehousing is the storage and management of inventory that will be sold online. Different ecommerce warehouses are owned by 3PLs or are operated and owned by the retailer itself. Here are some basic functions of ecommerce warehousing:
- Performing warehouse and inventory audits
- Recording inventory/stock levels and running inventory reports
- Identifying stock availability and turnover
- Managing all locations of bins, shelves, and pallets for slotting purposes
- Engaging in the appropriate safety/security actions for inventory storage
- Preventing stockouts by re-ordering product
Types Of eCommerce Warehouses
Different varieties of warehouses suit different businesses and their needs. The right ecommerce warehouse will provide the amenities along with expertise in digital fulfillment services, plus the ability to strategically store inventory for the most efficient delivery practices. Here are four types of ecommerce warehouses.
1. Dropshipping
Dropshipping is when the manufacturer of a product controls their entire supply chain, from producing and storing to the shipping of its product. No third-party merchants will handle the item; the manufacturer personally handles the shipping of the order.
Transit times tend to be very long for dropshipping, as it mostly occurs overseas.
2. On-demand Warehousing Solutions
In on-demand warehousing, businesses rent storage space for limited periods of time. This model is based around technology companies that contract warehouses with excess, shared warehouse spaces to store inventory. On-demand warehousing works well with seasonal or pop-up sales, but in essence is outsourcing fulfillment needs to a company that outsources it themselves.
3. Fulfillment Centers Or Distribution Centers
A fulfillment center is designed to manage a majority of the ecommerce process. A fulfillment center will receive and store inventory, and will then be able to pick, pack, and ship orders efficiently.
Most ecommerce businesses are utilizing fulfillment centers that outsource fulfillment to a 3PL such as Product Fulfillment Solutions or Amazon. Fulfillment services such as these handle order fulfillment for you.
Which eCommerce Warehouse Is Right For My Business?
There are a multitude of factors that should influence which ecommerce warehouse fits your business. Find a partner who fills in the specific gaps in your supply chain. Here are some factors that should impact how you choose your warehouse solution.
- The size of your business volume
- Your amount of available capital
- Available resources for logistics
- Existing warehouse space
3 Benefits Of Using An External eCommerce Warehouse
Partnering with an experienced 3PL such as Product Fulfillment Solutions can help reduce shipping costs and make deliveries more efficient. Here are three benefits of using an external ecommerce warehouse:
1. Time To Focus On Growth
Instead of being stuck dealing with ecommerce warehousing and shipping, use a 3PL to handle your ecommerce supply chain. Shifting responsibility to an external ecommerce warehouse can open up more time and energy for you to put into the actual growth of your business.
2. More Accurate Picking And Packing
3PL services include warehouse picking and packing, which is normally a significant time investment in the fulfillment process. 3PLs have specialized staff to optimize your supply chain, backed up by part-specific industry expertise. The technology and internal processes utilized in 3PLs ensure that the correct inventory is packaged and delivered at the optimal pace for the best customer experience.
3. Easier To Stay Organized
Personally managing inventory can be a labor and time-intensive process, keeping track of product, shipping, and other fulfillment obligations. Handing over the tedious fulfillment process to a 3PL lets the experience of the 3PL, such as Product Fulfillment Solutions, solve these problems for you. They have the technology and industry knowledge to better handle your ecommerce fulfillment needs.
eCommerce Warehousing Best Practices
The wrong ecommerce warehousing practices result in wasted money and delayed orders. Utilize these ecommerce warehousing best practices to improve both your financials and the customer experience.
Use A Warehouse Management System (WMS)
A WMS is a specialized program that can optimize the operations of an ecommerce warehouse. The main features a WMS offers include:
- Real-time insights into inventory and product availability
- Develop inventory forecasts to avoid running out of product
- Monitor the entire ecommerce supply chain
- Optimize the overall efficiency of the ecommerce fulfillment process
Integrate Your eCommerce Store
Integrating your ecommerce store with your warehouse management system will allow you to instantly determine your inventory stock along with easier inventory forecasts and can more efficiently set reorder points before shortages rear their head.
Distribute Your Inventory
Placing inventory across multiple warehouse locations allows for shorter shipping times and therefore lower shipping costs. When an order is placed, being able to automatically prep and ship from the nearest distribution center can get customers their orders faster and more cost-efficiently.
Test Multiple Picking Systems To Find The Right One
Choosing between individual picking and larger-scale systems such as batch-picking can make a noticeable difference in profits and carrying costs. For smaller ecommerce businesses, picking and packing one order at a time may be more cost-effective, versus a large-scale ecommerce business that will appreciate the increased efficiency and volume that batch picking allows in the fulfillment process.
Set Inventory Minimum Points
Setting mandatory inventory minimums can be a precautionary step to avoid out-of-stock notices and irate customers. You can also setup your software to send notifications upon low inventory notices. Don’t put even more pressure on the people behind your supply chain to keep another set of eyes on potential inventory missteps.
How 3PLs Help Unlock eCommerce Growth
For ecommerce businesses focused on continuous growth, selecting a 3PL provider such as Product Fulfillment Solutions can erase the time-consuming demands of the ecommerce fulfillment process. Using a trusted 3PL partner re-allocates time away from you worrying about inventory levels and shipping times to actually growing your business, so you don’t have to worry about warehousing and logistical processes.
Distributed Inventory
Product Fulfillment Solutions has two strategically placed distribution centers – Las Vegas, Nevada and Springdale, Ohio – to be able to provide the most efficient fulfillment process possible.
Product Fulfillment Solutions uses our decades of industry experience to pick, pack, and ship your orders as an extension of your company.
Order Management
Product Fulfillment Solutions is a problem preventer. We are personally invested and take extra care to identify potential problems and resolve them before they arise. We’ve learned through experience and are excited to share that expertise with you.
Technological Integration
The warehouse management systems of Product Fulfillment Solutions integrate with your e-commerce systems to provide seamless direct-to-consumer fulfillment. We can quickly and efficiently transition your orders to Product Fulfillment Solutions and begin managing your order fulfillment transactions.
Through our warehouse management systems, your inventory is available for online review and management from the moment it arrives, 24 hours a day, 7 days a week. Real-time inventory management allows you to stay informed and in control of your direct-to-consumer fulfillment activities.
Analytics And Detailed Reports
Product Fulfillment Solutions’ Electronic Data Integrations (EDI) can quickly and easily integrate with your e-commerce platforms allowing real-time inventory tracking with access to information 24/7.
Product Fulfillment Solutions makes it so you’ll never have to worry about your inventory counts or shipments. Log in any time of day to monitor and manage real-time inventory and inventory track to manage your products and business.
Conclusion
eCommerce warehousing can be a balancing act depending on the nature and size of your ecommerce business and sales, but every business needs to have an efficient ecommerce warehouse to be able to grow profits and scale efficiently.
Do your research when looking for warehousing options for your ecommerce business, considering what retail supply chain expertise they have to offer, and who can provide the best customer experience.
Want a personalized consultation to discover what 3PL solutions can do for your business? Contact PFS today!