When should you change fulfillment providers? It may be a difficult question to ask when you have shipments already moving through the supply chain. However, your customers’ needs are paramount, especially since their expectations for customer service have grown. They want their shipments immediately, and products should arrive undamaged and as advertised. Many fulfillment centers promote themselves as the go-to expedited delivery option that provides exceptional services and the best pricing in the industry.
However, fulfillment excellence varies among different fulfillment companies. The issues may lie with their lagging processes and outdated technologies. Other times, your operations may have evolved to where you require more robust fulfillment operations that the existing partner cannot provide. Let’s review eight warning signs that indicate when to change fulfillment providers.
1. Lackluster Customer Service
The biggest factor that causes many companies to change fulfillment providers is poor customer service. If you cannot get the CEO or supervisors of the fulfillment center to address issues with missing or delayed shipments or other problems, it can heavily damage your supply chain capabilities.
Remember that most of your customers may not know that you are using a fulfillment provider to make deliveries. If they experience an issue, you get the brunt of the complaints and the loss in business revenue, even though the issue may truly lie with the fulfillment provider.
2. No Fulfillment Scalability
Every company has different fulfillment requirements. Over time, these requirements may change. You may downsize your operations when you need fewer services, or your business may grow to where the supply chain requires added resources to keep pace with the demand.
A provider that cannot scale their fulfillment capabilities to anticipate future demand might struggle to get orders out on time or not have the inventory on hand to ship. The fulfillment provider you work with needs to understand how to scale order fulfillment services to keep up with fluctuating customer demands.
3. Pricing Not Up to Par
When selecting a fulfillment provider, all service pricing should be clear throughout the business relationship. If price hikes do occur, your provider should communicate this with you clearly and concisely.
The fulfillment provider also needs to review their pricing structure to determine whether your company still needs the current level of service or if a different service package with lower pricing would be a better fit. If there are too many price hikes that happen without warning, you should be wary. Your customers may be unhappy if they see your product prices jumping around too frequently.
4. Cannot Handle Subservices
There are many subservices that a fulfillment provider may offer. They may provide special packaging and branding during sales promotions, assemble gift boxes, offer special labeling on certain products, or provide essential inventory management.
If a fulfillment center cannot handle your requests or has no way to take submitted requests, this could impact how you promote your products to end customers. Additionally, if your marketing strategies do not match your customer expectations, it could cause your clients to distrust your brand.
5. Not a One-Stop Provider
More businesses are looking for one-stop shops that can offer a wide array of services under one roof. Going to multiple fulfillment providers to gain a specific service is not cost-effective or efficient for your business. Finding a one-stop fulfillment provider allows you to have all the services bundled under one roof — likely with more favorable pricing options.
6. Technology Not Advanced
Outdated technology could hinder your company. If the fulfillment center has not updated its technology to the latest applications or processes, competitors might be able to outpace your business operations. As a result, everything within your supply chain could slow down, leading to slower delivery and potentially unhappy customers.
Additionally, many of your customers likely use multiple e-commerce shops to make purchases. A fulfillment provider should have the technology to work with multiple sales channels, communicate inventory needs with warehouses, and coordinate shipping routes with carriers to track packages.
7. Too Many Delays and Damaged Products
Shipping delays and damaged products can happen in fulfillment centers. It is a common problem throughout the industry. However, this problem should not occur so frequently that your customers are dissatisfied, nor should you experience too much material waste on returned products.
It can be difficult to identify where in the supply chain these damages and delays are occurring. It may be at the fulfillment center if they are packaging and mislabeling the shipments, or it could be that the drivers are not loading the packages correctly and not arriving on time.
8. Inefficient Services in Your Most Important Locations
You likely select fulfillment centers closest to your main customer base to reap in the most profits. If inefficiencies are happening at these locations, you may never gain the full ROI — even if you have fulfillment providers in other locations. Every area needs to have the most efficient and cost-effective services.
Seamless Fulfillment Solutions at WSI
Scalability, sufficient services, excellent customer service, and competitive pricing are just some of the benefits you want to find when selecting a provider. Here at WSI, we offer a wide variety of fulfillment service solutions that can be scaled to your present and future operations. Our company offers everything from fast order delivery to labeling to returns management and more.