Each company that sells and ships items must develop a way to execute orders. Often, this requires outsourcing the function to a third party provider . Once hired, the provider will get in shipments, manage inventories and make certain that all orders are sent promptly and properly . In this article, we will talk about why companies outsource this indispensable function and how it works.
The reason businesses hire other companies to deliver their products and manage their inventories is really rather easy . For one reason , most companies have little or no knowledge with logistics. Take your typical e-commerce company per say . What these businesses are good at is marketing and selling their products on the internet. In business lingo , we would say that those are their core competencies, or the things that they do well .
However, what they do not do best is run warehouses and ship goods . In fact, most e-commerce companies do not have access to a warehouse. And even if they did, the cost of creating a logistical network from scratch is highly prohibitive. A company would need a warehouse for storage, trucks for transport, a logistical team for management, and a warehouse staff for manual labor. Not surprisingly, the average e-commerce company cannot afford the large startup costs required to build their own network. It is much easier and less costly for them to merely outsource the service to professionals.
What do you need to know ? Before you hire a provider , you must decide which type of provider will serve your customers best. At present , the most popular warehouse management system is called pick and pack. It works by taking advantage of bulk orders and saving money on storage space. Let us take a moment to explain how it works.
One of the first and most significant considerations for any third party logistics provider is to make certain that they take advantage of every useable inch of warehouse space. When the space is properly used , they will be able to fit more goods, which means more companies and more money. Pick and pack allows them to do this by storing bulk orders of hundreds of unlike items in a small space. Usually , bulk orders are stacked on pallets, rather than easily unpacking them. This saves the company useful shelf space by simply leaving the products in bulk until they are required .
For this reason, it may be difficult for littler companies with low sales volumes to find a suitable service provider, since bulk orders are required to realize the cost savings of pick and pack. Turnaround time, delivery options and customer satisfaction are the three most important factors when it comes to choosing a service provider. It also important to find a provider that offers web-based inventory solutions. This gives you, the owner, the ability to monitor the performance of the service provider to ensure that shipping and turnaround times stay within the desired range.
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Article contributed by Southern Fulfillment Services, a leading fulfillment company, providing warehousing, transport and logistics services to business of all sizes. Southern Fulfillment Services (SFS) is a privately owned Florida based company with production facilities in Vero Beach, Florida, Harlingen and Palestine, Texas.
Related Blogs to Jason Berkes
Outsourcing To A Pick And Pack Provider
Each company that sells and ships items must develop a way to execute orders. Often, this requires outsourcing the function to a third party provider . Once hired, the provider will get in shipments, manage inventories and make certain that all orders are sent promptly and properly . In this article, we will talk about why companies outsource this indispensable function and how it works.
The reason businesses hire other companies to deliver their products and manage their inventories is really rather easy . For one reason , most companies have little or no knowledge with logistics. Take your typical e-commerce company per say . What these businesses are good at is marketing and selling their products on the internet. In business lingo , we would say that those are their core competencies, or the things that they do well .
However, what they do not do best is run warehouses and ship goods . In fact, most e-commerce companies do not have access to a warehouse. And even if they did, the cost of creating a logistical network from scratch is highly prohibitive. A company would need a warehouse for storage, trucks for transport, a logistical team for management, and a warehouse staff for manual labor. Not surprisingly, the average e-commerce company cannot afford the large startup costs required to build their own network. It is much easier and less costly for them to merely outsource the service to professionals.
What do you need to know ? Before you hire a provider , you must decide which type of provider will serve your customers best. At present , the most popular warehouse management system is called pick and pack. It works by taking advantage of bulk orders and saving money on storage space. Let us take a moment to explain how it works.
One of the first and most significant considerations for any third party logistics provider is to make certain that they take advantage of every useable inch of warehouse space. When the space is properly used , they will be able to fit more goods, which means more companies and more money. Pick and pack allows them to do this by storing bulk orders of hundreds of unlike items in a small space. Usually , bulk orders are stacked on pallets, rather than easily unpacking them. This saves the company useful shelf space by simply leaving the products in bulk until they are required .
For this reason, it may be difficult for littler companies with low sales volumes to find a suitable service provider, since bulk orders are required to realize the cost savings of pick and pack. Turnaround time, delivery options and customer satisfaction are the three most important factors when it comes to choosing a service provider. It also important to find a provider that offers web-based inventory solutions. This gives you, the owner, the ability to monitor the performance of the service provider to ensure that shipping and turnaround times stay within the desired range.
————-
Article contributed by Southern Fulfillment Services, a leading fulfillment company, providing warehousing, transport and logistics services to business of all sizes. Southern Fulfillment Services (SFS) is a privately owned Florida based company with production facilities in Vero Beach, Florida, Harlingen and Palestine, Texas.
Related Blogs to Jason Berkes