When Should I Outsource Fulfilment?

For any small business, there is one goal which both takes precedence over and contains every other – growth. A small business needs to be orientated towards growth. If it isn’t, the alternative is normally stagnation.

If you for a second though think that stagnation is okay, that you can truck along at a particular level indefinitely so long as you see steady profits, then you have a fundamental misunderstanding of how business actually works. Stagnation is not just stagnation – it is death for a company. And there’s a good reason for this.

Say your small business, which sells a limited inventory and has the same expenses every month, just continues doing this with no plans for growth. You might think that this can continue indefinitely, but eventually the chance for growth will come along and missing it does not simply mean no growth, it means the exact reverse.

This is because a company that is surviving will always incrementally accrue interest and gradually see its customer base increase. Eventually, the infamous “sold out” error message will become a more and more common. Unless some investment is made at this point – for example in acquiring more inventory – then more and more customers will come to your site only to be disappointed. The company will then gain a reputation for being unreliable and having inventory which frequently sells out. At that point, you will not just lose your new customers, you will lose your existing ones too.

At the point when the opportunity for growth comes along, you need to grasp it or fall behind. And one of the major investments which small businesses make in order to grow is outsourcing fulfilment.

What is Outsourced Fulfilment?

When a small business just begins, it is likely that fulfilment will be handled in-house. This is possible when there is only a small inventory, and the company isn’t shipping too far. In fact, for some products with a distinctly homemade appeal, this is likely to be broadly accepted by customers who are aware they are purchasing from a small company.

Regardless, there comes a point along the path of growth when fulfilment should be outsourced. This is when a third-party company begins handling your fulfilment, packing up your products, and shipping them out, usually much further and with the aid of regional distribution centers. The great benefit – of course – is that more customers can be served across a wider area.

How to Ensure the Fulfilment Service is Up to Scratch

Generally, the best way to choose a third-party fulfilment is to ensure that certain important elements are all accounted for. Firstly, you want reach, and a fulfilment service that can ship your goods far and wide. Secondly, you want security, and you should ensure that all goods are going on trucks with secure truck tie down straps such as those sold by Rollercam, security tags, and so on.

Thirdly, you want a fulfilment service that you can afford at this point, although bear in mind that making this investment is sure to see a return – so long as you match it with increased inventory.

When to Outsource?

Rollercam say that all shipping should meet security standards, and so requiring greater security is not an indication that it’s time to outsource – that should be ensured from the start. Rather, outsourced fulfilment should come after another investment has been made – inventory.

Quite simply, if your customers are waiting a long time for your inventory to arrive because you have too many orders, then it’s time to outsource. Great speed, reach, and more professional packaging are all bonus advantages to doing so.