10 Reasons to Outsource Subscription Box Fulfillment
Do you run a subscription box service? Thanks to the advent of the internet and the ongoing coronavirus pandemic, more Americans are eating at home using meal kit delivery services. The $1.5-billion meal-kit delivery service industry is raking in cash during the outbreak, as are subscription service businesses selling essential products. For the remainder of 2020, and likely well into 2021, consumers spending habits are going to change.
Instead of going out to a restaurant for a meal, consumers are looking to order deliveries from the grocery store or meal kit services. Instead of going to the movies, people are signing up with Netflix. Instead of going shopping at a retailer for your hygiene essentials, you’re ordering them online from subscription platforms.
Subscriptions are big business as consumer behavior shifts. If you’re in the subscription market, then we’re sure you’re seeing a big jump in sales as people move to order online instead of leaving the house.
How are you handling that growth? Chances are it was terrific in the beginning, but the thrill is wearing off as you struggle to fill all your orders. When your logistics and shipping start to slow growth, it’s time to get out of the way and hire a 3PL partner to help your business flourish with subscription box fulfillment.
Subscription box fulfillment companies can be a lifeline that you desperately need in order to continue your business expansion. In this post, we’ll look at the top reasons to outsource your subscription box fulfillment.
1. Free Up Space in Your Home
Most eCommerce entrepreneurs start their business at home. Starting from the comfort of home is great. You set your work hours, there’s no commute to the office, and you have everything you need close to you. Working from home can be a blessing for many reasons, but it becomes a nightmare when the order book starts to grow.
As business scales, many entrepreneurs end up parking the car in the driveway, using the garage as a warehouse for inventory. If you’re like Jeff Bezos, starting your business from your apartment in NYC, chances are you have stock lying around in your living room and your bedroom.
While the home-based warehouse may work for a while, you’re going to need bigger premises eventually. What you’re selling online makes a difference to your warehousing space and the need for this move. For example, if you run an eCommerce site selling small items like vitamins, your garage might be adequate.
However, if you want to experience big-time success with your company, you’re going to need to find larger warehouses. Subscription box fulfillment companies can help you fill this need.
A 3PL offers a solution to this issue. 3PL companies have networks of warehouses at distribution hubs across the country. The 3PL will help you warehouse your inventory, freeing up space in your home. Sure, if you’re running a meal subscription service, warehousing space isn’t a concern. However, if you’re involved in selling deodorant refills or other hygiene consumer products, you’re going to need that space.
3PL companies offer tailored solutions to meet your needs. When using a 3PL, you remove the warehouse from your home, but you can still enjoy working from home without worrying about your inventory.
2. Save on Resources and Time
When you got into the business, we doubt you were thinking about the logistics involved with managing your order flow. Most eCommerce entrepreneurs focus on the outcome, and the money they’re going to make with their new subscription service.
When it comes down to executing the plan, you’ll end up finding yourself packing boxes and mailing items for half the time in the day and you will start to think twice about your approach, especially as your orders start picking up.
Hiring people to do the job costs you money in wages and time in training. As the boss, you’re responsible and accountable for your employee’s mistakes and you will need to make things right with any customers dealing with employee mistakes when filling subscriptions.
Why go through all that hassle when you can outsource these issues? With 3PL subscription box fulfillment companies, you don’t have to concern yourself with employing or training staff. The 3PL does it for you, and you oversee the process through software that manages your order flow. The 3PL picks, packs, and ships your items to your clients, without you having to lift a finger.
3. Scale Your Business
When things start to take off with your business, you will experience an inflection point where growth becomes exponential. At this point, you will need to hire a 3PL as quickly as possible. Planning for the growth of your company is a critical management task that needs to occur before the orders start to skyrocket.
You need to look further down the line and imagine the possibilities for your company. While planning this growth, you need to know when to implement a 3PL service for your company. Waiting too long to implement a 3PL service will overwhelm your resources leads to customer complaints and lost orders.
Creating your plan and researching subscription box fulfillment companies is the best way to stay ahead of these issues before they become a problem. You need to do your due diligence with researching potential fulfillment companies as soon as possible.
4. Handle Fluctuations in Order Volumes
As a subscription service, you’re going to experience fluctuations in your order volume. The busy time of the month is around your subscription fulfillment date. For a few days around the 1st or 15th, you’re going to have plenty of work, depending on your model. However, in the interim, the business will slow between subscription dates.
You need to work with subscription box fulfillment companies that understand and comply with your business’s peaks and valleys. 3PL companies only charge you for the services you use, and there are no fees due for downtime.
5. Reduce Your Logistics Costs
The costs of mailing and delivering your own orders will drive up the costs of your overhead. With subscription box companies, you get a partner that delivers worldwide using a network of logistics companies to assist with transporting your products to your subscribers.
Subscription box fulfillment companies work with several transportation services to ensure your subscribers get their orders on time. 3PL services often have discounted accounts with logistics companies, which allows you to have huge savings on your logistics costs.
By leveraging the logistics and warehousing network of your 3PL, you get your orders out timely and to the right address at the right price.
6. Stop Service Errors Before They Occur
When you’re responsible for picking, packing, and shipping your products, there’s a chance you (or your employee) could make a mistake. If you’re starting to get hundreds of subscribers, doing it all yourself is going to be a hassle you don’t need.
As a result, you can expect mistakes to happen. If you have hundreds of orders and rush to fill them, it’s likely you’ll make a mistake with an address. Maybe you miss the pick-up time for your orders, and delay delivery to your customers – it happens to eCommerce businesses that conduct their own fulfillment all the time.
Unfortunately, these random transgressions will lead to lost customers and sales. This also risks damaging the reputation of your business. Can you imagine if an angry customer gets on Twitter and starts publicly shouting about your inability to deliver on time? The horror – but what if more people join in the conversation?
How will that scenario look for your customer service and your business? Many eCommerce companies ended up going under for just such a reason.
By hiring subscription box fulfillment companies to do your picking, packing, and shipping, you can shift accountability. You’re paying for the service and dealing with industry professionals, so you can expect professional service that eliminates mistakes from your processes.
If accidents happen, you have recourse to take it up with the management of the 3PL, asking them how they intend on ensuring these mistakes never happen again. Working with a 3PL partner is like having employees working for you, without the hassle of having employees working for you.
7. Reduce Overheads and Expenses
Does your home look like a mess when it comes time to ship out your monthly subscriptions? Rolls of tape and bubble wrap all over your dining table, with your partner moaning about the mess of all the boxes in the garage.
Picking, packing, and shipping your orders is a giant pain. It takes up space in your home, and time on your schedule. Why spend hours everyday collating and shipping your orders when you could be doing other things that grow your subscriber base?
The costs of all these materials aren’t cheap, even if you’re buying in bulk. Working with a 3PL means that you never have to worry about shipping your orders again. 3PL partners have accounts with leading packaging companies. Therefore, they get great discounts on all packing materials.
Some 3PL Subscription box fulfillment companies even offer customized packaging, with your logo included on the boxes and tape. Using this strategy may cost you a few cents more on all your orders, but it sends a professional tone and message to your customer.
With the right 3PL provider, you’ll have a reliable and stable way to track your overheads. All you receive is one itemized bill to settle each week, instead of sporadic invoices from multiple suppliers.
8. Manage Your Customer Returns Properly
We bet you love handling customer returns, right? When someone sends your product back, it feels like a slap in the face, even if they have a legitimate reason. However, accepting and processing customer returns is a part of being in business.
Dealing with receiving returned parcels, unpacking, and examining goods for resale is a pain that takes up time in your day. Hiring someone to do the task requires you to train them, and you’ll have to inspect and audit their work from time to time, as well as keep a detailed, accurate log of the returns for future reconciliation purposes.
Rather skip the hassle of dealing with customer returns, get a 3PL provider to do it for you! Imagine the joy of never processing another return. Your 3PL provider accepts the return on your behalf, processes it, and reports the data you need, such as photos of damaged products.
9. Leverage 3PL Software Technology
Even though subscription box fulfillment companies handle everything to do with your logistics, warehousing, and customer returns, you still need insight on their shipment data. You need to ensure that they are picking and packing the right products and processing your orders correctly and on time.
3PL companies offer software programs or cloud-based systems to clients that monitor every step of the logistics process. When orders come through, they are automatically routed to your 3PL. Through your software portal, you can check up on critical data points such as tracking intake quantities and improving communications between you and your subscriber base.
The software also shows you your warehouse inventory, re-orders when the stock starts running low, and issues reports on every logistics process. You can track your shipments at every stage, ensuring your customer receives their order.
With the right 3PL partner, you can monitor the entire logistics process from the comfort of your home using nothing but a laptop.
10. Focus on Growth Not Logistics
Your time is precious and it’s the most valuable asset you have. Why are you spending it doing low-value tasks in your organization? Sure, everyone wants to start small and build a big business. During the incubation phase of your business, you need to run things as lean as possible to save money.
However, there comes the point where that strategy starts to do your business more harm than good. By working with subscription box fulfillment companies, you get to offload some of the responsibility, delegating your logistics to professionals with systems to handle all your logistics needs.
As an entrepreneur, you need to focus on building your business, not working in your business. The costs of hiring people are astronomical and very few can afford a full–time staff when running an eCommerce business in the early stages of development.
With a 3PL partner, you can overcome the challenges of dealing with your logistics, freeing your time to focus on growing your subscriber base.