Category: LA Fulfillment Services

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A Quick Fulfillment Guide to Happier Customers

Operating as a team to boost your success.

It takes a village to make your customers happy. At every point in the supply chain, there is an effect on customer satisfaction. At Medallion Fulfillment & Logistics and Sprocket Express, we call this the satisfaction chain.

Along the way, there are basic principles that you can use to specifically encourage higher consumer confidence. For happier customers, we recommend these six strategy points.

1. Always Be Accurate

Mistakes stick out and they hurt a brand’s reputation. No matter the size or severity of the error, there is an impact. Adhering to the highest standard of accuracy and insisting upon the same level of accuracy from business partners creates a supply chain with fewer weak links. If each vendor has this priority on accuracy, there will simply be less mistakes.

Fewer errors means fewer returns, less special handling charges, higher customer retention, better overall satisfaction, and less headaches for you.

2. Transparency is Solid

Recently, customers became more interested in seeing real-time inventory levels. To some businesses, this was not only intrusive, but unimportant to the selling process. However, Business Insider recently reported that 66% of customers prefer a business with transparent inventory across digital platforms.

Both the shopping cart software and fulfillment coordination must operate correctly and in tandem to provide this result. We recommend discussing this with a Medallion or Sprocket sales rep more information.

3. Just Ask

Your customers have opinions and they are the best source of constructive feedback, but they won’t always make the first move. Make sure to ask for reviews and feedback with language such as: “We invite you to contribute online feedback about our products/services.” To build a stronger relationship, show appreciation with customized promotions and offers. Customers will be happy both to be asked and to be rewarded.

There are many ways to encourage more reviews for your business, but the most important is to simply ask. Millennial consumers have made it clear that they are more likely to buy products that have been recommended by friends and even social media influencers, though they might not be personally acquainted.

4. Speed is Needed

Fast, faster, fastest are the new categories. Consumers have no time or patience to wait for packages because the normal lead time is now just two days. As automation of last-mile delivery increases in prevalence and capability, we expect to see more same day deliveries.

Keep customers happy with expedited shipping options (most are willing to pay extra for this perk) and quick fulfillment. Logistics providers who are not offering same day shipping are falling behind in the market.

5. Bend and Flex

No one likes a strict rule when it works against them. Although it is clearly necessary to have protocols and schedules, a little flexibility goes a long way towards customer happiness.

Do you offer a generous returns policy? Are customers able to make last minute special orders? Your customer service agents must be empowered to offer compensation and special arrangements as they are in the trenches speaking with the consumers themselves.

Consider compensating negative feedback as heartily as positive feedback. Those that have a really memorable experience with your company can become its biggest champions.

6. Be Partners

Your fulfillment provider can be an integral part of your success if you choose the right one and allow them to be partners. A logistics partner can help your business flourish and you will benefit from their years of experience. Whether it’s shipping options, e-commerce packages, returns, storage, or even custom packaging and labeling, a true partner will have positive input to improve your processes and keep your customers happier.

In Closing

Not every fulfillment house is a match for every brand. We invite you to read our guide to choosing the best fulfillment partner for your business and encourage you to phone us for a free price quote at 800-260-8250.

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Online Returns are Growing Faster than E-Commerce Sales

Return Policy

We have been writing about return merchandise more and more throughout this year as the business of reverse logistics heats up to a record pace.

When 20% of your revenue is in a revolving door, forecasting can get pretty dicey. Add to that the overwhelming percentage of customers who expect easy, inexpensive return options, and it’s clear no business can overlook the power of reverse logistics.

Incidentally, if you like statistics, this article is going to be a fun read. The numbers on the subject are compelling, to say the least.

Breaking Returns Records

In the U.S. alone, Statista estimates return deliveries will cost $550 billion by 2020, an increase of more than 75% in four years. If that seems pretty bleak for the bottom line, let me point out that this figure does not include inventory loss or restocking fees.

The rate of returns is always higher during the winter holiday season. In 2019, UPS predicted an impressive number of returns even before Christmas Day even arrives… to the tune of 1.6 million per day. Merchandise is literally flying back and forth, changing hands constantly. For statistics fiends, this means there are more than 18 returns per second before the holidays are over.

January 2 is typically the biggest day for returns, forecast at nearly 2 million in 2019 (an increase of 26% in a single year). But online sales are only projected to increase by around 12% in 2019, which means returns are growing at twice the rate of online sales.

New Models

The current digi-centric commerce model relies on returns. According to Shopify, a full 90% of customers “highly value” free returns as a key factor in their buying decision. And nearly 70% avoid buying from companies that do not offer completely free returns.

Online sales returns are now averaging 20%, with 30% for holiday orders and even as high as 50% for “expensive items.” This is more than twice the rate of brick-and-mortar retails. Ironically, the physical storefronts often limit returns to re-saleable merchandise and simply put it back on the shelves.

Online Returns Are Another Species Entirely

Amazon encouraged a “no questions asked” returns policy, but has recently begun to address the overuse of the policy. Many of the returns cannot be resold and end up on liquidation sites. Small sellers on the giant platform may end up losing significant revenue if they cannot minimize returns, since they don’t always have the option to refuse and remain in good standing with Amazon. And with Fulfillment by Amazon sales, the decision is out of the seller’s hands entirely.

So what’s the bright side?

Benefits of Reverse Logistics

When handled correctly, reverse logistics can actually improve your bottom line as we described in our guest post at Storeya.

Planning for returns is actually quite similar to planning inventory requirements. If you address it ahead of time and have a strategy in place, there is nothing to fear. Although it’s hard to adjust the mind set, your business will benefit from letting go and embracing the inevitability of growing returns volume.

Get out ahead of the returns spiral by offering alternative programs. For instance, the Amazon wardrobe program allows customers to buy clothing with the intention of trying it on and only keeping what they like. It’s a perfect example of embracing the problem. This way, the business is prepared and can also charge accordingly.

Zappos is another company who made it a policy early on to accept returns, for free, all the time. And although they struggled operationally, the customer satisfaction rate was very high. They found that customers who returned the most also spent the most overall.

Reverse Logistics Strategies

Of course, the strategy will vary greatly depending on your business category. Apparel is the number one returned product category, with over 50% of these due to sizing issues. In this case, providing detailed sizing information up front can help cut down on the number of returns. And including accurate images from all angles, preferably with 3D viewing and human models helps too. Beyond that, designing a loyalty program around returns, similar to the examples above, mitigates the inventory loss and manages customer expectations.

For products that are easy to restock, such as DVDs and books, focus on the packaging and restocking needs and streamline the process so it makes a lesser impact. These items don’t expire and they rarely show wear, making it easier.

However, vitamin companies need to have a clear policy to avoid restocking expired (or close-to-expiring) products, which will only make a bad impression on the next customer to receive the item. This factor can impact the supply chain even earlier in the process, to manage inventory with longer shelf lives to allow for returns without gumming up the works.

Proactive Management

In some categories, it may make sense to build the cost of returns into product pricing. Since an average of 20% of merchandise will be returned, consider factoring this into the margins from the beginning. There are many elements to evaluate for improving reverse logistics flow.

Embracing the New Normal

The bottom line is returns are the new normal. How your business handles them can make all the difference between loss and gain.

When you are ready to explore options for fulfillment services, Medallion Fulfillment & Logistics and Sprocket Express are ready to step in and handle shipping and return processing.

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Subscription Boxes Lead the Way in Direct to Consumer Sales

Subscription Boxes Work to Build Your Business

From our June Newsletter – Subscribe Today!

Over 25% of consumers are signed up for subscription box services. The industry now contains over 3,500 established box services worth roughly $10 billion. And, according to MultiChannelMerchant, 75% of DTC (Direct to Consumer) brands will offer subscription services by 2023.

As the subscription model becomes more popular, many businesses are wondering if they should ride this wave with their own subscription boxes or supply their products to mixed or mystery boxes to attract new customers.

Subscription boxes are beneficial to everyone, which is one of the reasons they have become so popular across the board. Here are some of the benefits to consumers and businesses.

Consumers

• Save money

• Try new products

The benefits to consumers are simple. Not only can they avoid running out of products that they use regularly and count on, they also save money on these products. Plus, they can discover new products in the samples included in the boxes.

Sometimes the boxes are random selections, while other times boxes are selected entirely by the consumer. Each has its own benefits.

Businesses

• Better order forecasting

• Enhance customer loyalty

• Improve bottom line

Order Forecasting

One of the challenges of retail in general is the predictability of order flow. Some businesses experience a very regular pattern throughout the year, with peak season activity predictably raising revenue. But most struggle to anticipate the order volume. Forecasting isn’t easy, especially when it’s about the future.

The subscription box model helps regulate the order flow by grouping orders and standardizing the activity among subscribed customers. Although some will cancel their subscriptions, the overall pattern will be more regular than businesses without subscription options, evening out cash flow and helping predict revenues month over month.

In the early days of e-commerce, a business would need to manually create reorder logic to ship to a customer each month. Today there are numerous services that provide this capability within existing e-commerce platforms, communicating with fulfillment partners as well as the customer and fully automating the process.

Customer Engagement and Loyalty

Subscribing to a box is an act of loyalty. This model helps build a relationship between the customer and the business. The consumer is more likely to purchase from the business that they deal with so regularly and the business has an easier time creating engagement for promotions or new items and cross-selling.

Building this level of trust paves the way for potential up-sells. Familiarity enhances customer loyalty in this case. And it’s worth noting that many of these businesses would not have encountered or attracted the customers without the exposure to product trials that subscription boxes create.

Bottom Line Benefits

Subscription boxes can also save the business money. By regulating order flow, there is more predictability in inventory, which prompts a leaner supply chain and reduces carrying costs. At the same time, the business gains new customers and a more predictable order flow.

Fulfillment Partners

• Better forecasting

• Fill niche services

Similarly, a fulfillment partner that processes subscription boxes may be able to move inventory through more quickly, cutting down on stagnant inventory. Storage costs are rarely a significant source of revenue for a fulfillment house, but they can impact a business’ bottom line.

By filling orders and utilizing inventory in a more efficient manner, a brand can achieve JIT inventory (just-in-time inventory) and smooth the supply chain so there are less stuck-in-storage costs. This is good for everyone.

Shipping large volume for a client once per month helps a 3PL better predict staffing needs. 3PLs are accustomed to ramping up staff for peak holiday seasons, but when a client has a very successful sales promotion without warning, this can create a strain on the fulfillment operation.

Subscription boxes help regulate this flow and make the peaks more predictable. Not only does the fulfillment partner benefit from more regular peak order volumes, but this improves efficiency which impacts the 3PL’s bottom line.

Much like the businesses themselves, fulfillment partners can forecast revenue more easily with the more regulated pattern lent by subscriptions.

Fulfillment services who are adept at serving the subscription box market are prepared to handle the relevant logistics. Medallion Fulfillment & Logistics and Sprocket Express have successfully worked out the kinks and are set up to provide service to this niche, which is growing rapidly. This expertise helps us provide quality service to our clients across a variety of fulfillment scenarios.

Conclusion

The subscription box model works well for all parties in the transaction.

• Predictability (of delivery, order flow, revenue)

• Efficiency

• Relationships

• Saves money (retail prices, inventory, supply chain, preparation)

If your business is not involved in subscription service, this may be a good time to research your options. Almost every brand has a product that fits in one or more of these boxes. Contact us today to see how we can help with your subscription box service needs.

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Introducing Greg Kent Our New President

Fulfillment Warehouse

Medallion Fulfillment & Logistics has made its name in the fulfillment warehouse industry by providing a full range of services scalable to accommodate each customer’s individual needs. This personal approach continues with the appointment of Greg Kent as our President and acting Manager.

Founder Gene Kent, Greg’s father, assumes the role of CEO, where he will remain involved in Medallion’s daily operations. Gene has several exciting projects in the works as he focuses on growing Medallion’s scope and reach among companies seeking scalable and startup fulfillment services.

Meet Greg Kent

Greg literally grew up in the fulfillment warehouse business, starting 35 years ago as he helped his father ship packages from the family garage that was the original home of Medallion Fulfillment & Logistics. After moving to a 1,500 square-foot warehouse, the company moved to a succession of increasingly larger facilities before reaching our current 50,000 square-foot warehouse.

After several years of working in the family business, Greg recognized the value of broadening his knowledge and took a job with a large fulfillment firm. He spent four years learning all aspects of running a large fulfillment warehouse operation. Armed with all that information, Greg returned to Medallion and put his knowledge and skills to use growing the company.

Medallion’s Growth in the Fulfillment Warehouse Industry

Over the last five years, Greg has been leveraging Medallion’s reputation for elite customer service to forge relationships with large national fulfillment centers that are now referring startups and small-sized fulfillment clients to us. Thanks to Greg’s efforts, Medallion is recognized across the industry for our expertise in fulfillment services for small-, medium-sized and startup companies.

As Greg explains, top-tier fulfillment houses are now referring to Medallion as an “incubator for fulfillment.” These companies specifically admire Medallion’s ability to provide large-scale services on a small scale.

The Future of Medallion Fulfillment & Logistics

While Medallion’s growth is being fueled through nationwide referrals, Greg’s focus remains on strengthening the company’s position as a primary fulfillment warehouse resource for small-, medium-sized and startup businesses. Greg points to the rise of eBay, Amazon and other eCommerce retailers increasing the need for fulfillment services that are responsive, cost-efficient and scalable.

According to Greg, “I feel that we are a hidden gem that has now been discovered by startup entrepreneurs and a set of top-tier national fulfillment companies.” But throughout Medallion’s current and future growth, one thing remains constant. “We will never lose our friendly family-business approach to providing exceptional service at an affordable price.”

Medallion: Your First Choice for Fulfillment and Warehousing Services

Under Greg Kent’s leadership, Medallion Fulfillment & Logistics continues to offer the same quality of personalized service started by Gene Kent in 1982 as he shipped packages out of his garage. We view our clients as part of the family and their success is our goal.

Are you ready to put Medallion’s uniquely versatile fulfillment warehouse services to work for you? Contact us for more information.

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The Amazon Effect: Considerations for eCommerce and Brick and Mortar Store Owners

In the increasingly crowded and competitive world of eCommerce, Amazon remains the gold standard. The impact of the online retailing behemoth has been so primal and far-reaching that marketing experts have coined a term for it: “Amazon Effect.”

As the leader in California fulfillment services, we work to stay on top of trends and innovations influencing the industry. Here’s what you need to know about the Amazon Effect and how it applies to your business.

Shifting Buyer Expectations

Amazon’s principal effect has come in the area of buyer expectations. Consumers are demanding a buyer’s journey be “frictionless and immediate,” and these expectations cut across the digital arena to goods and services purchased in brick-and-mortar locations.

These three benefits top the list of what retailers are expected to provide today:

• Free shipping, which is most prominently featured in Amazon’s Prime membership program. While shipping costs can be steep, Amazon has found that it’s paid off in powerful customer loyalty and add-on sales.

• Speedy turnaround time, where customers receive orders in days rather than weeks. Amazon Prime’s free shipping takes only two days, and same-day delivery is available in more than 10,000 locations.

• Easy access, with a variety of options for ordering and delivery. For example, Amazon offers delivery or pick-up for grocery orders and certain items are eligible for subscriptions where orders are entered and delivered automatically.

Generational Differences and the Millennial Mindset

Not surprisingly, younger consumers who have spent their entire lives with technology are more demanding when it comes to eCommerce fulfillment and delivery. A 2018 survey of online shoppers in the U.S., Canada and U.K. found that less than 50 percent of respondents between the ages of 18 and 34 were fully satisfied with their orders.

Other studies have uncovered the “Millennial Mindset,” which Amazon has embraced with great success. The Millennial Mindset is a group of six brand values that buyers from 18-34 rate highly in their shopping experience:

• Social Circle: Is a brand popular within a buyer’s circle of family and friends?

• Self: Does a brand generate an emotional connection?

• Innovative: Does a brand lead its field in creative advancements?

• Trusted: Does a brand have consumers’ best interests at heart?

• Purposeful: Does a brand contribute to the greater good?

• Accessible: Is a brand easily assimilated into a buyer’s lifestyle?

While this mindset originated with Millennials, it’s having a ripple effect through other generations. At this point, Generation X has adopted the mindset nearly as completely as Millennials have.

Countering the Amazon Effect in Brick-and-Mortar Stores

• Use locations to complement eCommerce, not duplicate or compete with it.

• Engage high-tech solutions to track in-store behavior

• Leverage mobile apps with mPos, location-aware coupons and personalized service.

California Fulfillment Services that Exceed Customer Expectations

Medallion Fulfillment & Logistics provides 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 fulfillment services.