Questions About Fulfillment? We Have Answers!

Here are answers to most commonly asked questions about order fulfillment.

What is Fulfillment Outsourcing?

The definition of fulfillment is the process of receiving, packaging and shipping orders for goods. Any company that sells products directly to consumers via phone sales, their website, or through mail order must provide fulfillment to process these orders. Some companies choose to perform these services in-house with a staff of employees that receive the orders, process them, and mail them to their customers while other companies outsource this function to a third-party full-service fulfillment house.

Full-service fulfillment companies offer an end-to-end solution: they take your products from warehouse shelves, pack them, hand them to shippers and then send an automated e-mail response to your customers to let them know their packages are in transit. They can also supply current inventory levels to your website, reorder products, offer call-center services, send notices of shipping, and handle returns.

What Services Do Fulfillment Houses Provide?

Order Processing Services: Whether the orders are received via phone, mail, or web, the fulfillment house processes the order and ships it. This service is the key element to the utilization of a third-party fulfillment service.

Return Processing: Fulfillment houses also provide the service of accepting and processing returned or damaged items.

Storage: Fulfillment houses store your merchandise and provide security/insurance for the items that are located in their locations.

Product Assembly: Fulfillment houses provide the service of assembling or kitting products for their customers. Fees dependent upon the complexity of the assembly are usually associated with this service.

Inbound Call Center Services: Fulfillment houses provide inbound call center services to handle phone inquiries.

CD/DVD Replication Services: As part of their array of services, many Fulfillment houses offer the service of CD/DVD replication.

Contract Packaging: Often times, Fulfillment houses will package products in specialized or customized wrapping per your specifications.

Rebate/Sweepstakes Services: Fulfillment houses will provide services to their clients to process rebates or sweepstakes.

What are the Benefits of Fulfillment Outsourcing?

While there are many benefits to outsourcing fulfillment processes to a third-party fulfillment house, some of the most important reasons include:

1. The ability to concentrate on your core business. Not being involved in the day-to-day process of fulfilling orders enables personnel to focus on marketing your products, thereby improving sales and increasing revenue.

2. Staffing concerns are shifted from your company to the fulfillment service. During peak seasons, your fulfillment provider will manage staffing and space concerns.

3. Controlled costs. Since you will only be paying the fulfillment house for the work they perform for your company (fulfillment of orders, assembly of products, storage etc), you are able to project costs and maintain the specific margins needed to ensure profitability.

4. Warehouse space is no longer a concern since this will be passed on to the fulfillment house. It is the fulfillment company’s responsibility to provide enough space for busy times and seasonal needs.

5. Many of today’s successful companies including General Electric, Pepsi, Merck, Home Depot, Wal-Mart, McDonalds,  and Amway have discovered that outsourcing gives them a competitive advantage.

How Do I Select The Right Fulfillment House?

When choosing what fulfillment service to partner with, keep the following criteria in mind:

1. Make certain you have a clear-cut understanding of exactly what services you require and make sure you and the vendor you choose are on the same page.

2. Be certain to ask for references, preferably from other clients that sell similar product lines to yours. All reputable fulfillment houses will be able to provide references from customers who use their services.

3. Evaluate the geographic location of the fulfillment house. While some companies prefer to work with a fulfillment service that is in relative proximity to their physical location, others prefer to work with one in a centralized location to maximize their shipping savings.

4. Discuss manpower concerns with potential fulfillment vendors. Fulfillment houses often times employ a core group of permanent employees and supplement staff with temporary workers during peak periods. Discuss any concerns about safety and security with prospective companies.

5. Accuracy rates are very important in fulfillment (see Why is Accuracy Important in Fulfillment?). Make sure to ask any potential fulfillment sources for their current accuracy rates.

In summary, there are several reasons to outsource fulfillment work and there are many quality fulfillment houses from which to choose. Make sure the fulfillment provider you choose has the tools, staff, and experience to do the very best job possible. After all, each packages shipped on your behalf is a reflection of your company.

Confused About Folded Self Mailer Regulation Changes?

Sometimes a picture is worth a thousand words.

We have discussed postal regulation changes regarding a category of mail called Folded Self Mailers in previous blogs. (See New Requirements for Folded Self-Mailers). Recently, however, we ran across a video (thanks Fold Factory!) which clearly shows and explains the new regulations.

http://www.youtube.com/watch?feature=player_detailpage&v=fK4CkcZTN6Q

One important part of this video is the description of what can and cannot be used as the addressing panel. This change is catching many designers by surprise. Under the new regulations, the mailing panel cannot be created by the final fold.

Another change catching printers and designers by surprise is the paper weight requirement. Whereas compliance with postal regulations used to be based on mail piece thickness, you will see in the video that compliance is now based on a combination of thickness and paper weights.

The video is well done and only seven and a half minutes long. Happy viewing!

USPS to Implement Six-Day Package, Five-Day Mail

According to a variety of news sources, the US Postal Service (USPS) announced on Wednesday, February 6 that it will cease delivering first class letters and other mail on Saturdays beginning August 5, 2013. It will continue to deliver priority and express mail, packages, and mail order prescriptions.

Mail addressed to street addresses will be delivered Monday through Friday. Post Offices open on Saturdays will remain open and mail addressed to PO Boxes will be available for pickup on Saturdays.

The Postal Service continues to grow its shipping and package business as e-commerce retail sales continue to rise. With a 14‐percent growth in volume the last two years, the Postal Service feels justified in maintaining six days of package delivery. Also, by maintaining a six‐day package delivery schedule, the primary concerns related to switching to a five‐day mail delivery schedule have been addressed, such as the delivery of pharmaceutical drugs.

By implementing a six‐day package, five‐day mail delivery schedule, the Postal Service expects to save approximately $2 billion annually when fully implemented, which still falls far short of the tens of billions it needs to cut. This is part of the overall cost cutting efforts the USPS has undertaken and was triggered by the default at midnight, February 6, 2013 on a $5.5 billion payment, according to a report first broken by CBS News. The money is required to fund health benefits to future retirees. This is not the first time the organization has defaulted on a payment. Last year it defaulted $11.1 billion worth of payments and at one point exhausted its borrowing authority with the U.S. Treasury.

In its last fiscal year, the Postal Service recorded a $15.9 billion loss.

It is unclear whether the USPS actually has the authority to stop Saturday deliveries because it has previously said that approval from Congress would be necessary to do so. It has been seeking that permission for quite some time, but Congress has been reluctant to grant that permission. Although it is an agency of the US government, it operates on a business model more like a private corporation. The USPS does not receive any tax dollars for operating expenses, but must rely on the income from its sales and services.

Speaking about the decision to cut first class service on Saturdays, Postmaster General Patrick R. Donahoe said: “We are simply not in a financial position where we can continue to make six-day letter delivery.” The decision to halt Saturday delivery of most mail ends a 150 year tradition.

For more information, please visit usps.com

Three (Incredibly Simple) Questions The Most Successful People Use To Change The World

Last August, Forbes published this article by Entrepreneur Mike Maddock. What could be more simple than to use the answers to these three questions to work through life’s challenges?

 

I’ve heard it said that the most brilliant business ideas are often the simplest. From my experience, it’s true. In fact, when I am fortunate enough to receive sage advice from a famously gifted person, I’ll often ask myself, “Why didn’t I think of that?” So here I humbly share with you a winning formula that I see leaders use again and again and again…to change the world.

Use this formula the next time you feel stuck—whether you are trying to change your industry, your company or your personal life—and I promise you it will work.

Question Number 1: What’s the outcome I want?

Most people seem to get stuck in the moment, caught up in the drama of a situation they don’t like. They unwittingly wind up playing the helpless victim, and as I’ve written in the past, victims can’t innovate because they are focused on the problem—not solutions. You will hear them talk about how things aren’t fair, who has wronged them, and they look for encouragement or excuses to feel better about the status quo. While this may make them feel good, being energized by problems is a recipe for inaction.Asking the question “what is the outcome I want?” forces the mind to focus on the final destination, not the current bumps in the road. The brilliance of this question is that it immediately puts you in the “creator” mindset. And once successful people envision the destination, they move quickly to the second, world-changing question.

Question Number 2: What stands in my way?

(Hey, I told you these were simple questions.)

The best leaders are masters at identifying and prioritizing obstacles that are between them and the outcome they want. Then they brainstorm ways to eliminate, avoid or neutralize the obstacles. Last year I saw George Clooney on a late night talk show. He had recently lost 20-plus pounds that he’d put on for a movie role. The host was amazed at how good Clooney looked and asked him how he had managed to lose the weight so quickly. Clooney’s response sounded something like, “I ate less and exercised more.” Too often in business, we talk about how hard it is to “lose weight” while reaching for a potato chip. But leaders using this formula move quickly from the outcome, to the plan, to the execution. “I want to be 20 pounds lighter,” says the enlightened leader. “So what stands in my way?” Let’s see… I don’t seem to make time for exercise. So I will start the day with exercise or I will block time on my calendar. So each weekend, I’ll pack my gym bag for the entire week and put it in my car. I need to eat better because a bad diet will make this impossible. So I will do my homework, buy healthy snacks and eat small portions throughout the day. So I will pack my lunch and stop eating fast food. Without a bunch of accountability, this will never happen. So I’ll tell my friends, family and coworkers about my goal and when it will be achieved. So I will buy a digital scale and weigh myself every day.

Question Number 3: Who has figured it out already?

So now our creators have identified the outcome they want. They have created a list of obstacles, prioritize the list and identified ways to overcome each obstacle. This is where some leaders spring into action while others pause to steal ideas. Yes, I wrote steal ideas. But since stealing is a politically incorrect term, we’ll call their strategy parallel engineering.

In the mid ’90s, our company had grown to about 25 people. We had dozens of projects happening at once and needed a more efficient way to manage the growing complexity of our business. So being the brilliant, naïve entrepreneurs that we were, we naturally decided to build a software system to help us track, manage and optimize each project.

After spending roughly $185,000 and hundreds of hours in time, we scrapped the project. Three phone calls later we bought an off-the-shelf system that did 90 percent of the things we were trying to build into our own custom solution.

Gosh, I wish we had paused to parallel engineer ideas.

Intelligence is learning from your own mistakes; wisdom is learning from the mistakes of others. It’s less painful to be wise than smart. It’s also a lot cheaper. That’s why this third question is so important.