Three Reasons To Outsource Mailing Fulfilment
- admin in category: Entrepreneurship
Facilities
The facilities needed for the storage of goods can make a substantial dent in a company’s profits, particularly if the main focus of a business is ecommerce and they need to store a large volume of goods. There are three primary options when looking to locate storage facilities; to build, purchase or rent. There is a fourth option however – to outsource the use of storage facilities to an ecommerce fulfilment company. Ecommerce and mailing fulfilment services will operate a very large storage facility, for which they will be paid a nominal holding fee by a large number of different clients. While the fees charged by each mailing fulfilment company will vary, and will be based upon differing criteria, the costs incurred by the client company will generally be less than if they were to seek other methods of storage.
In addition, if the client company were to choose to operate their storage facility in-house, they would not only need to consider the rent or purchase price but will also need to factor in the price of electricity and heating as well as staffing costs.
Shipping Costs
Shipping costs can be expensive, and it isn’t always in the best interests of the business to pass the entirety of this cost onto the consumer. However mailing fulfilment and ecommerce fulfilment services tend to send out thousands of packages every day, because of this they will often be able to negotiate a lower price with the courier than the client company. These savings can then be passed onto the client company, and in turn passed onto the consumer. The reduced shipping costs incurred by the consumer will then encourage them to make a purchase, and will make you stand out from your competitors that are unable to offer such low rates for shipping.
The Cost of Shipping Materials
The cost of shipping does not start and end with the delivery itself; the packaging materials must be considered also. This might include envelopes, boxes and padding materials such as bubble wrap. As with the cost of the shipping, buying these items in bulk reduces the purchasing costs considerably.
Often, ecommerce and mailing fulfilment companies will quote that they offer ‘free packaging’. While this sounds enticing, it isn’t entirely true since the cost is factored into the price charged for shipping. However, it is still possible that the overall fee will work out at less than if each service is charged for separately. It also makes the costs easier to manage, thereby reducing the cost of finance and accounts management for the client company.
It’s worth noting that the majority of mailing and ecommerce fulfilment companies will offer a standard sized selection of packaging. This is because the larger the range of packaging offered, the higher the costs incurred by the fulfilment company since they will be unable to place such big bulk orders. If the client company wishes to utilise differently sized packaging than is offered they will either need to provide their own packaging, or pay an extra fee for the additional service.