For many business owners the decision about whether or not to outsource order fulfillment comes down to basic math. If the amount of money that they can save is significant then it’s worth the investment to hire a fulfillment services company. So how much money can you really save by switching a fulfillment center to process your orders? Probably more than you think. When you hire a fulfillment company you pay a portion of each sale for the services that the company provides. Paying a small portion of each sale is far cheaper than spending money on all the various aspects of the order process yourself. Look at how the costs of processing your own orders compares to the cost of hiring a fulfillment services company:
Warehouse space -the cost of renting or buying warehouse space alone makes the cost of a fulfillment services company seem cheap by comparison. Monthly rental or mortgage fees combined with upkeep costs, monitoring and security costs, and climate control costs make the cost of storing your products one of the biggest expenses that you’ll face. When you hire a fulfillment services company you are paying for a share of a warehouse space along with other customers so the cost is much cheaper than you would pay on your own. Plus, the fulfillment center staff take care of all the maintenance, security, and climate control so that you don’t have to pay any extra fees or salaries to employees for those services.
Customer service – Employee turnover makes hiring a full staff of customer service reps a costly proposition. Recruitment, hiring, and training employees cost most businesses thousands of dollars a month and that doesn’t include the cost of the employee’s salary or health benefits. Paying a fulfillment center a piece of each sale and getting a fully trained, fully staffed Internet and phone call center in return will save your business tens of thousands of dollars over a period of a year or more. As an added benefit when you hire a fulfillment company the company will take care of additional staffing as your sales increase so you won’t need to upgrade to a bigger office or new call center to house all your employees. That also will save you quite a bit of money over time.
Shipping – Fulfillment companies have special relationships with the major shipping carriers that include big discounts on shipping because of the huge volume of items that fulfillment centers ship. As a single business you won’t qualify for those discounts because you would be shipping a far lower volume of items. Take advantage of the special pricing available only to fulfillment companies by hiring a fulfillment center to process your sales.