29 December, 2022

9 key steps for the ecommerce order fulfillment process you must know

According to the eMarketer report, global retail ecommerce sales that amounted to $4.248 trillion USD in 2020 are expected to reach $7.391 trillion USD by 2025. The rise in ecommerce is indicative of the shift in consumer preference in shopping. You can sell your products online if you want to expand your business. If you are new to the ecommerce platform or want to improve your ecommerce sales profile, you are in the right place. We will guide you through the nine key steps you should take for the ecommerce order fulfillment process.

 

What is order fulfillment?

The order fulfillment process begins from the time the company receives an order to the time it is delivered to the customer. The order fulfillment process includes inventory management, as the products to be delivered should be acceptable in quality and quantity. The order fulfillment process should cover the goods returned if the customer is not satisfied with them.

A company can fulfill orders in the following ways:

  • In-house transfers: In-house transfer is when the company wants to transfer goods from one department to another. It is inclusive of transfers from the warehouse to factories.
  • Third-party logistics: Sometimes, the company uses third parties to carry out product transfers. This phenomenon is called third-party logistics (3PL).
  • Dropshipping: Dropshipping is a process where your supplier delivers the goods directly to your customer. This method of shipping saves transportation and overhead costs for the company. It is a good option for startups that want to save overhead expenses.
  • Hybrid: Companies don’t often stick to one type of shipping method but use different types of methods at once for separate orders.

As easy as it sounds, the reality is quite different if you don’t have a reliable system to follow. Inventory management systems like Cin7 can assist you in carrying out the order fulfillment process smoothly. Let’s discuss the nine key steps of ecommerce order fulfillment.

 

Nine key steps for the ecommerce order fulfillment process

If all the processes in your business organization run smoothly, your business can maximize its profits. Even if you already have an order fulfillment process, you must verify whether it is running efficiently. An optimized process can prevent damages and losses to the enterprise. The following steps should be followed for a well run order fulfillment process:

Step 1: Receive inventory

Every order fulfillment process starts with the receipt of inventory. The warehouse receives goods from the supplier. Goods received should be accounted for and adequately documented. The quantity and quality ordered should be verified. If there are any issues, concerns should be raised immediately.

As soon as the products are received and found satisfactory, identification codes, such as barcodes and QR codes, used by the company should be assigned to them. Identification codes allow the company to track these items and get information on them quickly.

Step 2: Racking the inventory

Some items need specific storage conditions, like lower temperatures, dry conditions, or sunlight exposure. All the items should be sorted and stored under the required conditions immediately to prevent deterioration.

Moreover, the goods should be arranged to reduce the space they take up in the warehouse. The storage location should be based on the frequency at which the items need to be moved from the warehouse.

Step 3: Receive orders

For receiving the order, it should be determined whether the company owns the stock and the time it would take to arrange the items. When a customer places an order, they should be informed about the expected delivery date and other delivery conditions based on the availability of the products. The company sends the confirmation of the order to the customer.

Step 4: Process the order

If you have inventory management software installed, the order fulfillment process is much simpler. It can automatically determine which warehouse or fulfilling station should be sent the order based on

  • the delivery location,
  • the warehouse location, and
  • the quantity of the goods ordered.

The order should be accounted for and passed to the relevant warehouse manager for further processing.

Step 5: Pick the order

Once the warehouse receives the order, the staff will start picking the items for that order. Picking means separating the items ordered from the warehouse inventory. A picking slip is used to list the items that are in the customer’s order. A picking slip can speed up the picking process and increase order fulfillment efficiency.

Typically, picking is carried out in the following manner:

  • Batch picking: The staff picks the items of several orders at once.
  • Piece picking: When one person picks one order at a time.
  • Zone picking: When every person is responsible for picking items for multiple orders from a specific part of the warehouse. The collected items are categorized into different orders for packing.

While picking the goods, the warehouse staff ensures that the products’ quality is according to the company standards. If the employee finds that some of the items have deteriorated in quality, they should contact the warehouse manager soon. The company’s reputation depends on the quality of the goods delivered to the consumer.

Step 6: Pack the order

The next step of the order fulfillment process is packing. The items should be packed in appropriate containers and wrapped in protective covering to ensure safe delivery. Delicate items must be packed separately and labeled accordingly. The containers must be sealed and a packing slip attached. The packing slip contains all the details of the order, including

  • Customer name and address,
  • Item details,
  • Payment method, and
  • Dimensions and weight of the package.

The packing slip should contain information on whether the delivery person is supposed to collect any amount for the delivery.

Step 7: Ship the order

A company has several options to ship the goods. They can ship the order themselves, use an agency to ship it for them, or ask the supplier to ship the goods directly to the customer (dropshipping). Except for when a company chooses dropshipping, it has to prepare the goods for dispatch. The company hands over the packed goods to the shipping partner.

The customer is informed that the goods are shipped and receive the tracking number. The company also has a tracking number to determine when and where the packet arrives.

Step 8: Deliver the order

The order is delivered to the customer. Typically, automation allows the company to notify the customers that their order has been fulfilled. Delivering the goods on time can boost the company’s reputation. The customer can communicate delivery preferences to the company, such as having their parcel left with a neighbor or changing the delivery timing for convenience.

Delivery is usually followed with customer feedback about the product and delivery experience. If the customer is happy, the fulfillment process is complete. If not, the customer initiates a return.

Step 9: Process the return

The company must handle the return of goods if the customer is unsatisfied with the products. It must arrange the return pickup and delivery. It is a crucial part of the ecommerce experience.

 

In a nutshell

In-person fulfillment doesn’t involve the complexity of the ecommerce fulfillment process, and therefore, the latter needs more attention. We have discussed the nine steps necessary for an efficient fulfillment process for ecommerce sales. Every company in ecommerce must audit their steps for optimization, and if they find some issue, they must resolve it immediately. This will increase the profitability of the company.

You can request a demo with our experts to learn how Cin7 can help you fulfill your ecommerce orders.

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