The Technology Behind Successful Ecommerce Fulfillment

Online sales in the United States have more than surpassed expectations. In 2012, online sales hit a record $226 billion, and accounted for 7% of all total retail sales. Experts projected $327 billion by 2016, but they were wrong… Total online sales in 2016 were $394 billion! If your fulfillment company isn’t participating in the ecommerce segment, no doubt you know that you’re missing out on an exceptional opportunity!

In this article, I’ll focus on the technological capabilities a warehouse needs in order to implement an ecommerce fulfillment service. The article isn’t going to be about listing the pros and cons of the Top 10 software programs on the market, because I don’t know your current capabilities or strategic goals. Instead, I believe that the most productive approach is to breakdown the process to help you identify where you can improve your systems.

Let’s talk about process integration. Ecommerce clients will typically approach a fulfillment company with an established business infrastructure. Integration means adapting your systems to plug into those of your customer. The processes that are frequently affected are:

  • Order Capture & Management
  • Picking/Packing & Shipping
  • Synchronizing Order and Inventory Status
  • Visibility
  • Client & Customer Service

Order Capture & Management

There are more than 300 ecommerce shopping cart companies on the market. Your company needs to be technically capable of adapting to the wide variety of methodologies for communicating with those carts. Orders from carts need to be harvested on a regular basis, controlled to insure none are dropped or duplicated, and converted into a form that is compatible with your system.

I believe this area represents the greatest technical challenge for fulfillment companies in the ecommerce space. Your tool bag for interfacing with a client’s systems must include a wide array of technologies, including the ability to interact with flat files, Application Program Interfaces, Web Services, File Transfer Protocol, call center systems, and the occasional manual-order entry. IT resources to plan the implementation and support this process need to be broadly skilled and creative. Administrative resources that perform the daily-order harvesting routines need to be highly attentive to detail.

Picking/Packing & Shipping

This process is probably the most straightforward. Picking slips are generated, product is picked and boxed, and shipping labels are applied using traditional fulfillment methods. Although there may be special requirements for packing slip and box branding, those requirements don’t vary much from conventional fulfillment. It is essential to operate at a very fast past as ecommerce performance is measured in hours and the volume of orders is measured in thousands per day.

Synchronizing Order and Inventory Status

Ecommerce fulfillment requires that the client’s shopping cart has the most recent inventory and order status information. Your systems need to regularly communicate inventory availability to the cart to ensure that a client’s customer is made aware of out-of-stock situations before placing an order. Customers also need to be able to reference the shopping cart to find the status of their order. Process synchronization between your operation and that of your client is an absolute necessity.

Visibility

Ecommerce fulfillment is very fast moving! We used to joke that customers would press the “buy” button and run to the front door looking for the UPS truck! With Amazon’s latest experiments in same-day delivery, this joke is almost a reality. Given the speed of ecommerce, it’s important for your clients to be able to have a real-time window into your process and inventory. At a minimum, clients should be able to see orders and inventory in near real time. The leading-edge, ecommerce fulfillment companies have taken a more pro-active stance by publishing “alerts” when important events are happening in the fulfillment process. Alert examples might include: Product X is running low on inventory; a new shipment of stock has arrived; or a customer has returned an order.

Client & Customer Service

The fulfillment process is heavily impacted by fast-paced marketing and promotional decisions. Ecommerce client support typically requires a designated coordinator to represent the client’s requirements to the fulfillment organization and to coordinate program changes. The volume and minutiae of detail often warrant the implementation of “issue logging” and “project workflow” processes within the organization. Given the pace of the business, these processes are best automated.

Some clients, particularly the Entrepreneur and Offshore segments, may ask the fulfillment organization to manage customer support. This might involve call-center work, authorizing returns, handling the occasional complaint, and so on. These client groups often have too small a volume to outsource their work to large call center. Having an arsenal of exceptional customer-support tools, therefore, positions you to capitalize on a good revenue opportunity.

In summary, successful ecommerce fulfillment relies on solid technical foundations. Warehouses and 3PLs must understand that ecommerce clients have very different needs (and expectations) for the technical aptitude, agility and pace of their fulfillment partners.  To fully capitalize on the ecommerce segment, your fulfillment service must meet–and exceed–these requirements.

How Can You Compete Against Amazon

Yes, when it comes to ecommerce, Amazon is the proverbial elephant in the room. Ignoring the online giant isn’t going to make it disappear, so the only business you have control over is your own. Do you wave the white flag or dig in and fight?

The good news is that, with a little creativity and skillful marketing, you can successfully compete against Amazon. Incorporate these valuable tips to reinvigorate your digital storefront and your ecommerce fulfillment services will be running on all cylinders in 2020.

1. Refine Your Focus

Amazon’s blessing and curse is that it wants to be all things to all people. As a small- or mid-sized online business, you have the flexibility to find your company’s specific niche and learn that segment inside and out. Once you’re established as an authority, you’ll become the go-to source for your product offering.

2. Leverage Content Marketing and Social Media

Amazon is a faceless behemoth and they do nothing to counteract that image. Use content marketing and social media to personalize your company and forge a connection with customers. Start a blog, share interesting stories and articles, run a contest, post pictures and videos. Be sure to track results and fine-tune your strategy based on what’s working and what isn’t.

3. Optimize Customer Experience

Can you even remember the last time Amazon made any changes to their website? Product pages are busy, clunky and boring, regardless of the device. A sleek, streamlined, user-friendly interface that’s consistent across all platforms and devices goes a long way toward making your company stand out. By the way, if you haven’t optimized for mobile traffic yet, what are you waiting for?

4. Don’t Fall Into the Price Trap

Some retailers make the mistake of lowering prices as a knee-jerk response to competition. Almost no one has the same economies of scale found at Amazon, so slashing prices is a losing proposition. Memberships, limited-quantity items and customization are just a few ways you can make shopping your storefront feel exclusive, which is a more effective way of differentiating yourself.

5. Offer Rewards and Loyalty Programs

Did you know that, until Apple Pay finally edged it out in late 2019, Starbucks had the most widely-used mobile payment app? Part of the reason is because users earn points toward free Starbucks food and beverages. Programs that offer discount codes, special offers and similar perks to frequent shoppers or members are a reliable way to build loyalty and encourage repeat sales.

6. Create a Subscription Service

According to a study by top management consulting firm Bain & Company in conjunction with Harvard Business School, just a five percent increase in customer retention can boost profits anywhere from 25 to 95 percent. A subscription service is easy to implement and brings in steady revenue while reducing costs. As a bonus, repeat customers are more likely to make referrals.

7. Provide Top-Level Shipping and Delivery

Thanks to Amazon Prime, online shoppers expect prompt, free shipping and convenient delivery. While it may not be feasible for you to offer 100 percent free shipping, you should provide at least some type of option, such as free delivery for a minimum total purchase. Tracking details and a no-fuss return policy should also be included in your shipping and delivery program.

Medallion: Ecommerce Fulfillment Services for Today and the Future

Are you looking for ecommerce fulfillment services that will grow along with your business? Medallion Fulfillment & Logistics offers a full range of services that are flexible enough to scale according to your needs.

Contact us to learn more, including information about our Amazon replenishment warehousing service. We now have a warehouse in Boston, Massachusetts in addition to our Los Angeles, California location to serve your need for fast delivery nationwide.

Tips for Building Customer Loyalty and Repeat Customers

Medallion is a California Based Fulfillment Company

As with many companies, your marketing efforts are probably directed primarily at converting prospects. But research shows overwhelmingly that repeat customers provide more value in sales and referrals at a lower cost to you.

Doesn’t it make sense to focus marketing activity on customer retention? Our California fulfillment services experts offer some creative suggestions to drive repeat business.

Create a Loyalty Program

A loyalty program is a simple but effective tool that incentivizes customers to come back to your website. Analyze sales reports to determine which criteria to use, such as rewarding repeat customers by volume or number of purchases.

Establish Trust

Consistency and transparency are two factors in building trust with your customers. In addition to making repeat purchases, consumers respond to trustworthy sellers by sharing their positive experiences with others A Forbes study shows more than 80 percent of respondents make purchases based on recommendations by friends and family.

Maintain a Social Media Presence

E-commerce lacks the personalized touch offered at brick-and-mortar stores. Connect with customers by staying active on social media. Answer questions, respond to comments, participate in discussions and post 10x content, original or shared, with genuine value to your target audience.

Sell a Superior Experience

“Sell the sizzle, not the steak” is a classic advertising motto based on the concept that customers respond to benefits, not features. With the amount of competition in today’s marketplace, it’s more crucial than ever to set your business above others by offering a unique buyer experience.

Use Packaging for Promotion

Even if you’ve never ordered from Amazon, chances are you’ve seen their shipping packages numerous times in places ranging from a friend’s home to a post office or UPS store. Take advantage of all that space on your packaging to keep your brand name and logo in front of current and potential customers.

Capture Conversions with Remarketing

All repeat customers begin as first-time customers, but industry statistics show that the average website loses approximately 98 percent of first-time visitors without a conversion. Remarketing with targeted ads to previous website visitors keeps you connected until they’re ready to buy.

Leverage Data

Digital marketing provides sellers with greater quantities of granular data than were ever available previously, but it means nothing unless you act on it. Mine data to learn as much as possible about your customers and use that data for targeted marketing campaigns and offers.

Provide Prompt Fulfillment

No matter how great your product is, nothing dampens a customer’s enthusiasm like long shipping times. If buyers know they can count on your company for prompt and professional order fulfillment, it gives you a distinct advantage over your competitors.

Boost Repeat Business with Our California Fulfillment Services

Are you finding it a challenge to juggle the demands of growing your business with the responsibilities of providing superior customer service? Let our California fulfillment services company handle your order processing needs from receiving and warehousing to shipping and customer support. Contact Medallion Fulfillment & Logistics for more information.

New Important Updates for January

Important News and Reminders for January

Here are a few links to help you understand some of the big changes that have already taken effect and could impact your bottom line. 

NOW through January 24th, USPS Rates have DECREASED to 2020 Rates

  • Temporary Rate Increase has EXPIRED
  • First Class Shipments reduced $0.25
  • Priority Mail Shipments Reduced $0.40
  • NEW 2021 Rates Take effect January 24th and can be downloaded here https://pe.usps.com/PriceChange/Index

UPS 2021 increase started on December 27th

UPS Announces 2021 General Rate Increase – ParcelIndustry.com

FedEx 2021 increase starts January 4th

FedEx 2021 General Rate Increase – ParcelIndustry.com

The cost of shipping is an unforgiving part of the new normal. Managing your shipping costs has never been more crucial to your success.

Value Added Tax (VAT) Must Be Collected Starting January 1st for the UK

Effective Jan 1, 2021, Value Added Tax (VAT) must be collected for all goods
entering the United Kingdom (UK).

There will be a 20% VAT rate on goods valued up to £135 (about $180 USD), which you must collect unless your online marketplace (e.g. eBay, Amazon, Etsy, etc.) is already collecting it. Current procedures for goods valued over £135 remain the same.

To prevent your UK shipments from being delayed, held, or returned by UK Customs in 2021, please consider the following steps:

1. Register for a VAT number with the UK: https://www.gov.uk/vat-registration
2. Collect VAT at the time of purchase.
3. Make quarterly VAT return payments to the UK.

In addition, you should include your VAT number on your customs declarations.
This process will vary depending on your shipping software, so be on the
lookout for instructions early next year.

California and Massachusetts Fulfillment Services that Exceed Customer Expectations

Medallion Fulfillment & Logistics and Sprocket Express provide a comprehensive set of eCommerce services that scale to meet your specific needs. Contact us to learn more about why we should be your first choice in cost-effective and efficient California and Massachusetts fulfillment services.

Our Top Tips for Business Startups – A Focus to Grow Faster

Medallion Fulfillment & Logistics a Fulfillment Warehouse

The first months of a business startup are exciting, but it can also be a time full of impatience. You’ve nurtured your fledgling company from a glimmer of an idea to a fully realized business, and you’re ready to take the world by storm.

That same passion that’s fueled your concept until now can help you grow faster as long as you stay focused. Our fulfillment company has been part of many successful startups, so we’re sharing some tips we’ve learned along the way.

Always Play to Win

Top sports coaches will tell you there’s a difference between playing to win and playing not to lose. Belief in yourself allows you to work from a position of strength rather than a timid, defensive attitude. Always bet on yourself to win.

Stay Flexible

Commitment to your business is vital, but as John Lennon once said, life is what happens when you’re busy making other plans. Many elements are out of your control, so you should remain ready to pivot in order to skirt roadblocks or take advantage of new opportunities.

Prioritize Customer Service

No matter what the product or service, the goal of every company is to satisfy customers. That’s particularly important today, when bad word-of-mouth spreads like wildfire via social media. Think of your customers as real flesh-and-blood people rather than faceless orders and put their needs first.

Keep Learning

In the early days, startup entrepreneurs are often forced to wear many hats out of sheer necessity. Fortunately, there are a number of helpful solutions available from inexpensive online courses to high-tech digital tools. Learning pays extra dividends in the future when you can effectively communicate with experts you hire for those roles.

Take Advantage of Free Advice

There’s an old saying that free advice is worth the price. But there is actually a wide range of groups and forums where you can network with others who have gone before you. Not only will you pick up valuable nuggets of knowledge, you’ll have the opportunity to form professional relationships that prove mutually beneficial.

Avoid Debt

We’ve all heard the dramatic stories of artists and entrepreneurs who maxed out their credit cards (and sometimes those of others as well) to finance their project or company. In most cases, that business model ends up draining your cash flow through costly interest charges. Get in the habit of paying cash whenever possible.

Maintain a Budget

Both personally and professionally, many people make the mistake of increasing spending as income goes up. While you may be tempted to do the same once orders start rolling in, your business will be better served if you continue to operate as though you’re on a shoestring.

Fulfillment Warehouse Services That Grow Along with Your Business

When you start a new business, you should be concentrating on gaining sales, not processing them. Medallion Fulfillment & Warehouse Logistics offers comprehensive fulfillment warehouse services that scale to fit your growing needs. Contact us for more information.