How can managing your own warehouse benefit you and your customers?
Do you prefer to have complete control over your efulfilment process and how you present products to your customers? Managing your own warehouse can be beneficial if you like to play an active role in each stage of your ecommerce fulfilment. Many businesses choose to manage their own warehouse, with the aim of delighting their customers and providing an experience that is special and unique to their brand. Here are some of the benefits of managing your own warehouse.
Personalised touches = loyal customers
Using your own fulfilment warehouse means you have more control over your branding and product customisation. This control allows you to add personalised touches to your product packaging. You may want to gift wrap certain items, for example. In-house ecommerce fulfilment can be especially useful if you offer subscription boxes or sell very fragile items. Your customers want to feel excited about receiving and opening a product. Unique packaging plays a huge part in this experience. Shipping products out yourself can also feel more personal to your customers, and many businesses take pride in doing this.
You have more control over inventory and warehouse operations
One of the biggest benefits of owning your own warehouse space is having direct control over your staff and inventory. You can personally ensure that your products are stored, handled and taken care of properly. This allows you to decide whether you need a new picking system, equipment, or further staff training. Many businesses like to feel involved in this process.
It can be suitable if you have a complex returns process
If you have a specific and involved returns process unique to your business, you may want full control over this. Many businesses enjoy talking to their customers directly, building positive customer relations.
It can be cost-effective for a startup company
If you are a small or startup company and don’t struggle to keep up with customer demand, in-house ecommerce fulfilment can be more cost-effective. If you have the resources and time to run in-house order fulfilment on your own, why not try it?
Can 3PL warehouses improve ecommerce fulfilment?
Managing your own warehouse might seem to be an easier option than finding and paying a 3PL, but that’s not always the case. Often, an ecommerce business will begin to use a 3PL fulfilment warehouse when it achieves business growth or higher customer demand, or it wants more time to focus on other duties. Does this sound like you? Have a read of the benefits that a 3PL warehouse can bring to you and your customers.
Central location means quick shipping
Are you based outside a city without close access to motorways? Relocating your business can be a hassle. 3PL warehouses are often based in convenient, accessible locations, meaning faster shipping, leading to customer satisfaction. You can also store inventory at multiple fulfilment locations near your customers, reducing time in transit and shipping costs.
High demand taken care of
Do you struggle to handle sudden spikes in volume or new products? This can be stressful when it leads to the hiring of new staff, purchasing new equipment or extending your warehouse. With the help of an outsourced logistics service, you can spend your time and money on other elements of your business.
Streamlined shipping and fulfilment solutions
3PL warehouses often have integrated systems that connect to online marketplaces and popular ecommerce platforms, such as Shopify and Magento, to send orders automatically to the 3PL.
Real-time inventory tracking
Using a third-party logistics company won’t mean you lose track of where your products are. Most 3PL warehouses give you the ability to track inventory and order progress, so you have insight into your products’ handling.
Lower distribution costs
Using a 3PL warehouse can often mean lower distribution costs, as it ships a larger volume of orders to certain locations.
Speedier than competitors
3PL warehouses often provide shipping services that you cannot offer due to either costs or business location. Think same-day and one-day delivery options to give you that competitive edge.
Save time and money
A 3PL can often save you time and money:
- Potentially lower distribution costs
- You don’t need to recruit and train new/temporary in-house warehouse staff when order volumes increase
- No longer managing your order fulfilment means you can spend time on other projects
- There is no need to purchase new equipment and acquire extra storage space if customer demand increases
Making the choice
So, how do you choose between both in-house and outsourced fulfilment? It can be helpful to consider the following factors:
Is your returns process very involved?
Your customers will expect a no-fuss return policy. If you have a very specific returns process and worry that a 3PL may not perform this to the same standard, you may want to handle this yourself.
Do you want to provide a personalised experience?
If you are passionate about delighting your customers with a personalised experience unique to your brand, managing your own warehouse is probably the best option for you.
Do you need time to focus on in-house issues?
Using a third-party logistics provider can help as you may want to spend time on other aspects of your business. This means you can finally focus on those other areas while they handle your logistics process.
Are you struggling with high customer demand?
Are you experiencing a dramatic increase in orders and struggling to keep up? You may not have the resources available to extend your warehouse, hire new staff or purchase new equipment. A 3PL warehouse can be a perfect solution.
How to choose a 3PL warehouse
If you’ve decided to use a 3PL, the following factors are important to consider:
Good location = speedy logistics
Try and choose a location close to major transport links such motorways, to ensure speedy logistics.
Storage and fulfilment cost
Budget carefully to ensure storage and fulfilment costs don’t use up too much of your operating capital. You should also ensure that your 3PL partner manages your stock effectively to avoid stock obsolescence. Regular slow-moving stock reports can highlight issues with your product range and marketing tactics. Slow-moving stock reports are especially important where there is perishable stock, as you need to ensure regular stock turnover.
Distribution costs
A 3PL can often offer cheaper carrier or courier rates than a small ecommerce brand can secure, so it is worth looking for a service provider with lower distribution prices.
Stability
Do your research, and try and find a third-party logistics provider with a good track record.
Attention to detail
Your customers deserve to feel appreciated. Choose a service that offers the same attention to detail in its fulfilment service and logistics operations that your own warehouse would provide.
Think modern
A modern warehouse management system and advanced technology can increase the speed of fulfilment operations and shipping. This will ultimately ensure a more efficient service, keeping those “where is my order?” emails at bay. Some 3PL warehouses also offer multichannel customer response centres to further improve communication.
Look for scalability
A shared-space environment is a key advantage of outsourcing a 3PL. The provider balances the needs of multiple customers, allowing it to meet peak requirements without investing in permanent space. This means they can scale operations to accommodate business needs, and if your needs change, your rates do not change unless there is a new service or profile update.
How much will a 3PL warehouse cost?
The cost of a 3PL warehouse depends on the following:
- Location
- Dedicated or shared warehouse services
- Your needs and product characteristics
On-demand warehousing platforms vs 3PL warehouses
A 3PL is ideal if you want more time to devote to the rest of your organisation. An on-demand warehousing platform finds warehouses that have space for you to use. 3PLs run their own fulfilment centres and have insight into what’s happening in all of their warehouses. Using a 3PL warehouse can feel more secure, as you are working with a team you have built a relationship with in a set location.
Linney can take the pressure off
Linney understands how important ecommerce fulfilment is in making your customers happy. We can ensure your products are handled with care and delivered to your customers quickly to provide a memorable ecommerce fulfilment experience. From stock management to managed ecommerce, and order fulfilment services, we can take the pressure off and help you achieve customer satisfaction.
Our online tools and fully configurable reports provide the visibility you need to facilitate stock management and replenishment, manage budgets, track orders and demand, and set automatic stock level triggers and destroy old stock.
You can find out more about the full range of services we offer here.