ECommerce fulfillment presents a number of challenges for brands as their business scales, outgrowing the startup phase and increasing the monthly flow of orders. In many cases, this stage of the growth cycle involves partnering with an experienced third-party logistics (3PL) provider who handles fulfillment services on their behalf.
Aside from the logistical aspect of eCommerce fulfillment, companies don’t need the headache of dealing with the rigid constraints of a traditional 3PL contract. Many brands and manufacturers find themselves locked into contract terms that limit their flexibility and, thus, their future growth prospects.
Traditional eCommerce fulfillment contracts can come with several challenges that brands should be aware of. They often include complex pricing structures featuring separate fees for storage, picking and packing, shipping, and carrier surcharges. These costs can prove difficult for sellers to predict and manage.
ShipBots offers a unique solution to this troublesome issue: a no-contract approach to eCommerce fulfillment. This provides shippers with the maximum flexibility needed to take advantage of market opportunities and react to disruptive events, without getting stuck with overly burdensome costs.
Traditional eCommerce fulfillment contracts with 3PLs have several limitations and drawbacks that hamstring sellers:
Rigidity: Traditional contracts often lack flexibility, constraining businesses in a rapidly changing market. They get locked into long-term agreements which limit their flexibility, making it more difficult to adapt to changing conditions. This impacts their business agility and ability to pursue strategic expansion.
Lack of scalability: These types of traditional eCommerce fulfillment contracts hamper a company’s ability to fluctuate order volumes as business and market conditions dictate or in response to competitor moves.
Financial commitments: Businesses are faced with budgetary strains due to high fixed costs in eCommerce fulfillment. This affects their financial management and negatively impacts the bottom line.
Restrictive volume and space requirements: Some eCommerce fulfillment contracts require brands to commit to a minimum order volume per month or a minimum amount of square feet of storage space. Meeting these commitments can be difficult for brands, especially during periods of fluctuating demand.
Limited customization: Standard contracts may limit a seller’s ability to customize its packaging, branding, or special handling, all of which can negatively impact the customer experience.
ShipBots’ focus and promise to eCommerce brands is a commitment to no legally binding contracts that tie up and hamper their business operations. Shipbots utilizes a Master Service Agreement (MSA) approach, providing a structured yet adaptable framework. This flexible approach aligns with the ever-evolving nature of your eCommerce business, enabling a greater degree of agility and responsiveness.
The MSA outlines terms that protect both parties. It ensures transparency, defines responsibilities on both sides and fosters a collaborative partnership without imposing restrictive obligations.
Brands and manufacturers need to carefully evaluate eCommerce fulfillment contracts and negotiate terms that best align with their specific business needs. They should also consider alternative fulfillment models, such as on-demand or flexible fulfillment, that offer greater scalability, customization, and control.
On-demand fulfillment offers sellers flexible, scalable warehousing and order processing. Clients can access storage and fulfillment services as needed, eliminating fixed costs and long-term commitments. This cost-efficient model provides agility and rapid scalability to meet fluctuating demand.
A flexible fulfillment model lets sellers adapt to changing demands. This includes easily adjusting storage, order processing, and shipping to align with fluctuations in sales volume. Like on-demand fulfillment, the flexible model enables efficient scaling, contains costs, and optimizes customer service.
A non-contract, MSA model fits in perfectly with this prudent approach. As noted above, businesses can access warehousing and eCommerce order fulfillment services and create a custom plan with their 3PL, without getting tied up in a long-term contract.
One of the most important things shippers who outsource their fulfillment services to a 3PL need to take extra caution with is a rigorous review of the terms and conditions related to the fee structure.
3PL fees can come in a variety of forms, including separate charges for fulfillment and order processing, warehousing and storage, software licensing, inventory management, and value-added services, to name some primary examples.
There are some common reasons why your monthly invoice from a 3PL can look different than what you budgeted for and agreed to. Things like the 3PL’s area of specialization or their business culture can be general themes. Other factors, such as service variations, unexpected costs (for things like equipment or system maintenance and repair), or changes in scope, can lead to unexpected fees and overages.
For these reasons, it’s important to ask your 3PL upfront about every cost associated with their operations and services, before signing any agreement.
ShipBots offers a transparent monthly maintenance fee that covers premium personal account management, connection to a world-class warehouse management system (WMS), order management system (OMS), and inventory management software. It also includes features such as discounted shipping options, claims management, and freight management services. API connectivity quickly and easily syncs your product catalog and any partners, such as retailers and third-party marketplaces.
The transparent pricing structure gives shippers a predictable, recurring fee for services, providing peace of mind by eliminating any fear of hidden costs or “gotchas” in their monthly invoices.
Many eCommerce companies are turning to a subscription box model, in response to huge demand from consumers for regular monthly orders. Hugely popular brands like Ipsy, Rent the Runway, Harry’s, and others have opened up the floodgates of the subscription boom.
Subscription box fulfillment is a specialized service offered by 3PLs, helping companies ensure that their growing base of customers is delighted each month when the order arrives on their porch. It involves complex logistics to efficiently manage order kitting and assembly and batching required in the subscription fulfillment process.
ShipBots offers dedicated services for subscription box businesses covering kitting, assembly, and timely shipping of all orders. It also provides the option of custom packaging, providing your customers with a unique, branded unboxing experience.
ShipBots, conveniently located near the busy twin ports of Los Angeles and Long Beach, also handles special projects such as eCommerce order fulfillment for crowdfunding initiatives, as well as light product refurbishment and rework.
ECommerce fulfillment often comes with specialized packaging requirements, depending on the type of product, how it’s branded and marketed, the amount of protection needed, and other factors.
ShipBots is committed to accommodating a range of custom packaging needs, from subscription box orders to apparel items and NFT-related products. ShipBots supports branded boxes or polybags, custom tissue paper, and package inserts. The company also offers sustainable packaging options as well.
ShipBots carries general liability insurance, and has an exceptional track record on preventing shrinkage at its facilities. That said, shippers are encouraged to purchase insurance on their stored inventory, which is as simple as adding ShipBots’ location to their current policy. ShipBots also partners with leading insurance companies to provide shippers with a quote within minutes.
ShipBots has developed and honed its technology and tools to provide everything you need to supercharge your eCommerce fulfillment. Its custom order management system (OMS) streamlines and automates the process of managing orders from website clicks to fulfillment. The centralized platform handles order entry and tracking, invoicing, and customer communication. Merchandise is automatically selected from the storage location closest to the end customer, to save on shipping costs.
You can easily import all your store information and product details to ShipBots’s dashboard, which integrates with all major eCommerce solutions.
ShipBots’ multichannel inventory management software keeps track of SKU levels across your website, retail and wholesale, marketplaces, and drop-shipping partners, avoiding stock-outs and overstocks. It closely monitors inventory movement from storage locations as well as from suppliers.
ShipBots harnesses the power of data and artificial intelligence, within a platform framework built on the concept of Fulfillment Intelligence. Utilizing this technology, ShipBots provides speed, accuracy, and accountability in eCommerce fulfillment services, enabling companies to improve customer satisfaction and loyalty and increase sales.
Brands that turn to 3PLs to handle their eCommerce fulfillment often find themselves wedded to long-term contracts with less-than-transparent fee structures. ShipBots does away with this hassle with its no-contract guarantee, providing a high level of flexibility that frees up shippers to allocate more resources to growing their business.
Beyond that, ShipBots' tech-first approach – with its OMS and inventory management software – offers fast integration with platforms, channels, and product catalogs. And its fulfillment services can handle everything from subscription box orders, Amazon FBA prep, TikTok shops, apparel, and beyond. Get a free quote or speak to an expert today!
