Without a doubt, staff and property costs make up some of the largest overheads of a business. Whilst for some companies this is unavoidable, for those who have to hold stock there is a solution. Put simply, outsourcing the logistics side of a business to an order fulfilment warehouse frees up time, effort and money, all of which will be undeniably better spent elsewhere. Hiring a team of staff to handle the varying order fulfilment processes, as well as funding a large industrial unit to accommodate everything, represent the big overheads we’re talking about. Holiday pay, sick pay, staff training, employment contracts and redundancy costs make up just some of the financial burdens that come with employing staff. Issues can also arise depending on how well a business is doing; a sudden influx of orders may result in the immediate need for more staff, some of whom may need to be hired on a temporary basis. This is costly in itself. Then there are slack times during which staff may not have enough to do; this is something a business owner may have to accept but nonetheless is, again, costly. Avoiding pouring capital into these areas means cash flow isn’t tied up and money can be utilised in more important areas of a business, such as improving marketing strategies and product development.
A Wise Investment
With many small businesses and start-ups unlikely to be in a position to find substantial capital to acquire premises of the size they need, using an order fulfilment company is the perfect answer. Whilst the demanding and time-consuming aspects of order fulfilment, like picking, packing and labelling, may initially be carried out in a home environment, there will come a time when a business will find they have outgrown their own resources. Besides, space will be at a premium in such an environment. Outsourcing the physical handling of orders and product storage to a fulfilment and distribution company easily solves this problem and doesn’t involve any large upfront investment. In addition, most order fulfilment companies will spend a great deal of money on purchasing up-to-date warehouse management software. This is not just to make their own lives easier, but also to ensure their clients’ orders are always processed flawlessly. Another reason why choosing an order fulfilment company is a wise investment is because it allows you to cope with unforeseen events. For instance, there may be a sudden shortage of raw materials, or government regulations may change, both of which could affect the ability to sell. Using an order fulfilment company and not having to pay for premises and staff means unpredictable events will have a far smaller impact on business.
Using an Expert
For most businesses, supply chain management is a critical element in their everyday operations but it’s probably not an area of expertise or their main priority. The process of inventory checking, storage, picking, packing, labelling and onward distribution of items to customers, needs to be closely controlled. When outsourcing fulfilment and distribution to a third party, a business is handing over one of their most important tasks and, it goes without saying, this may seem like a daunting decision. However, order fulfilment companies are experts in their own field, and they have a vested interest in making sure their clients’ sales orders are treated as if they were their own. They will also have arrangements in place with many different couriers and be able to decide upon the most cost-effective delivery solution for each client. Clients will also benefit from cost savings as a result of the better rates order fulfilment companies are able to negotiate.
If this sounds like what your business has been looking for, why not get in touch with us to discuss how we can help?