There are 7 steps of fulfillment: receiving inventory, storing inventory, processing orders, assembling teams, packing materials, shipping orders, and processing returns. This inventory method allows for greater efficiency and punctuality in deliveries.
What is Fulfillment?
Order fulfillment is how a business has their inventory handled. Its main goal is to manage orders as quickly and effectively as possible, making sure they are processed and delivered on time.
Customers expect to receive their items promptly and in perfect condition. To achieve this, companies need to process the orders and ensure they meet all the required specifications. This is why companies look for different organizational methods that help them meet these demands.
This process starts once an order is placed and ends when the merchandise is delivered into the hands of the buyer.
Types of order fulfillment
There are mainly four types of order fulfillment:
- In-House Order Fulfillment: Where the company assigns its employees to manage the process. The 7 steps are carried out at a location designated by the company.
- Outsourced Fulfillment: In this case an external logistics company is hired to handle the shipping, storage, and shipment processing.
- Dropshipping: In this type of fulfillment, there is no inventory to manage. It’s typically an option for retailers who don’t stock products themselves but purchase them from another supplier as needed.
- Hybrid Fulfillment: Combines the different methods of fulfillment as needed.
The 7 Steps of Fulfillment
There are 7 steps of fulfillment to be followed in order to make customers receive their orders promptly and smoothly. These steps outline the process from receiving inventory to processing returns when necessary.
1. Receiving inventory:
Once a customer makes a purchase, the company verifies that the inventory and items are ready before they can be prepared to ship. Orders may come either from the company’s warehouse or from an external distributor, depending on their business model.
When the items arrive, they are counted and inspected to make sure they match the quantity and specifications given and once completed; generally the order is prepared for shipping, and some other items remain in storage for a little longer. In this scenario, it’s a must to have all items properly labeled.
This step often involves services from specialized logistic companies, including transportation services.
2. Storing inventory:
Now that the merchandise is organized and labeled, it’s time to be transferred to the storage. Inventory may be stored short or long-term, depending on different factors such as existing orders or the need for wholesale stock.
Maintaining accurate stock records prevents sales delays and keeps customers satisfied. Utilizing Vendor Managed Inventory (VMI) services can help address any inventory management issues and delays.
3. Processing Orders:
When the customers place their orders, the products are prepared, either from the storage or by an external supplier.
To avoid delays, it’s best to automate this step which can be achieved by using an order processing management system. The system works alongside the shopping cart to detail the selected products. Another option is E-Commerce distribution services.
4. Picking Teams:
Once the order is finalized, the next step is to select the physical items for delivery. If this process is automated, robots will choose based on the specifications given.
If done manually, a picking service is employed to select the products, taking factors such as color, size, quantity, and other characteristics into consideration.
5. Packing Materials:
Pick and pack services are essential during this step. Once the products are sorted, they need to be carefully packed, and this task can be performed by either robots or trained personnel.
Factors like the fragility, size, and weight of the items need to be considered and materials such as bubble wrap are used to prevent damage during transportation.
6. Shipping Orders:
Once everything is prepared, the order is now ready to be sent to its final destination. In this step, transportation services such as merge in transit are used or other options that best suit your budget and delivery timeframe can be used.
It’s important to verify the weight and fragility of the items to ensure the right shipping service is selected.
7. Processing Returns:
There are many times when customers decide to return an item for different reasons. Companies can be prepared for this situation with the assistance of firms offering services related to the RMA Administration Returns Program. This will make the return, refund, or exchange process for the merchandise easier.
Benefits of having an order fulfillment process
The advantages of having a specialized logistics service company handle the entire order fulfillment process are:
- Timely shipments: These companies efficiently manage the process making sure the 7 steps are executed promptly which helps meet delivery deadlines.
- Customer satisfaction: Meeting deadlines and delivering products in good condition with the correct specifications makes it easier to keep customers satisfied and therefore decreasing the number of returns.
- Competitive edge: Since providing a positive customer experience is key, having an order fulfillment process is the advantage that sets a company apart from others in its industry, with product delivery playing a crucial role in achieving this too.
Implement the 7 steps of fulfillment to boost your delivery efficiency and ensure customer satisfaction. Manage inventory organization, transportation, and easily address any necessary returns with the help of a specialized company handling these tasks.
If you are looking for the support of a company specialized in logistics services, at EP Logistics we can provide you with a customized solution. Contact us for a quote.
