Smart business owners everywhere are always looking for ways to save money.
Whether that requires they invest a little to save a lot or simply change their processes in a particular part of the company, the ultimate goal is to watch their profits grow without their customers suffering — after all, the customer experience is what ultimately decides if you’re they’re business tomorrow. These successful businesses are finding that outsourcing their fulfillment is one of the best ways to save themselves money over the long term.
What does it mean to outsource fulfillment services?
Outsourcing your retail fulfillment services simply means you’ll be allowing another company to take over the packing and shipping duties for you. For example, many companies on the coasts are finding that outsourcing their fulfillment to the middle states helps speed up delivery times for customers and lowers shipping costs for them. After all, it’s faster and cheaper to ship a package from Florida to New York than from California to that same customer in the Bronx.
Save money when you outsource your fulfillment
Outsourcing to a professional 3PL (Third Party Logistics) company helps you save money, even if you’re not looking to move your distribution center. Because logistics companies focus much of their effort on distribution, they’ve generally got great deals already in place with shippers like UPS and FedEx. In addition, they buy their supplies in bulk, saving you money on necessities for pick, pack and ship, like boxes and packing materials. These are just the beginning of the ways they can save, though.
The primary reason many small and medium businesses choose to outsource is to save on in-house labor and storage rental fees. Since both can be costly, and are often only used at full capacity during short sales peaks in the year, having excess storage space or underutilized labor means money out the window. Hiring a logistics company, on the other hand, is all about paying for what you use — if you only use the equivalent of one employee and a 10 foot stretch of storage most of the time, that’s all you’ll pay for until your sales peak.
Outsourcing fulfillment makes sense for a lot of companies, allowing them to save considerable costs on labor and freeing up their current employees to spend more time on tasks that help the business grow. If time is truly money, the time your business saves on warehousing, packing and shipping is dollars in your pocket.