We often get the definitions of Fulfillment center and warehouse wrong. Their functions are similar only up to storing the products; after that, stories for these differ pretty much. Fulfillment warehousing can give two options under one roof. If you want to be successful in your international e-commerce business, then you must deal with the packaging and shipping of your products. This is because these two issues are the most central aspects of the whole international e-commerce business. If you intend to sell or are selling Chinese goods to other countries, then let’s discuss how to deal with the packaging and shipping of your products.
What is warehousing?
Warehouses are spacious buildings comprising hundreds of square feet where the business owners store the products. And this storage lasts until the distribution of those products to the wholesalers, retailers, and distribution centers. Warehouse shipping is an integral part of supply chain management.
Size and function of warehouse
Its size and function may vary depending on the inventory, materials, sites, and technologies related to bulk products stored in a warehouse. Its purpose is to stockpile goods and load and unload them before distribution. Sometimes it can store the products that require a particular time before maturation, like wine. If your business deals with selling seasonal products, then you might think about a warehouse to store them when the product is not in demand. Similarly, it’s the best option for the business owners to lend the warehouses to load their products and transfer them out on request.
Warehouses are the best choice for wholesales and B2B orders in bulk. To sum up, Warehouses can receive products, organize and store the inventory, integrate the technology, sort, and pack products, and most importantly, maintain the warehouse shipping facility.
Types of warehouses
Warehouses are of many types:
private, public, automated, on-demand, and Climate-controlled warehouses. So, they all are tailored according to the inventory requirements.
Fulfillment centers are a 3rd party logic(3PL) warehouses for supply chains. Fulfillment centers serve as a hub for receiving, processing, packing, filling, and shipping the product to the customers from sellers. The e-commerce retailers look for fulfillment centers to streamline their shipping operations quickly. It relieves the e-commerce companies from the nuisance of managing the challenging process of handling online customers.
Let’s discuss a little bit more about what is a fulfillment center?
While outsourcing with a fulfillment center, the owners can review the goods before transferring them to the fulfillment center. They can also send it directly for warehouse shipping from the manufacturer.
Fulfillment centers allow the vendor to hand over their responsibilities to them. And they don’t have to worry about the wear and tear expenses of the store’s houses and selling products. They are free from mispicks and misships, and fulfillment centers compensate for the money and losses the customers face.
Amazon has a collaborative network of warehouses and fulfillment centers to handle the processing, packing, and shipping of the orders on behalf of its partners. ShipBob and RedStag also offer fulfillment center facilities like Amazon. They ship products next to customer door by applying the same process.
How do fulfillment centers work?
Fulfillment centers operate to deliver orders to your door steps called the order fulfillment process. The inventory of eCommerce business is stored according to the 3PL to handover it to the customers. After the customer places the order, the merchandise is packed and processed for delivery to its final destination.
Fulfillment centers are used for both B2B orders and B2C orders. In B2B shipment, the orders are bulk, and in B2C are small and delivered to the customers’ doorstep.
The order fulfillment process helps the seller rest assured about the customer service and inventory management. It makes the shippment faster and returns secure and easy. The seller can focus on back-end strategies while making sure his business is in safe hands. Many shipping companies negotiate their budget with the fulfillment centers to offer free-of-charge shipping. Suppose the customers have to return any products they send to the fulfillment centers instead of the vendor. Ecommerce companies working dealing with fulfillment centers can track and integrate the orders by using advance technical tools and softwares.
What is a fulfillment warehouse?
The term fulfillment warehouse is often confused with the term fulfillment center. But these two have different jobs. A warehouse is a place to store the eCommerce products, whiles the fulfillment center does a lot more than this. It will be more accurate to say that fulfillment warehouses do the jobs of both fulfillment centers and warehouses under the same roof.
Fulfillment warehouses can offer long-term or short-term product storage services. Moreover, they are also bound to deliver the products on time. Order placements are a step from where the role of the fulfillment warehouse starts.
Difference between warehousing and fulfillment centers
Different delivery objectives
Firstly, Warehouses and fulfillment centers can both store the eCommerce products in bulk, and this is where the similarity between both ends. In warehouses, the products are not shipped to the individual customers but the wholesalers. Warehouses are concerned with the intermodal and freight carrier. While in fulfillment centers, these are delivered to the individual customers on-demand and the whole sellers.
The products are loaded in fulfillment centers, are transferred to the customers as soon as needed, and the new product is stored again in the fulfillment centers. The Product owner ensures the availability of the products that are finished or about to finished.
Communicate with customers
Secondly, it’s the job of the warehouse centers to deal with the customers, answer their queries, deal with the returned products, and compensate for the misdealing. The people to whom the products belong stay away from this nuisance. So, this is what makes it different from warehousing. And this helps the online eCommerce business easily ward off the most significant challenges.
The service content
Thirdly, Warehouses are mainly static and while the fulfillment centers are proactive. Although warehouses deal with large businesses, the job of a fulfillment center is more complex and challenging than the warehouses. A fulfillment center goes through the following steps.
- Accepting inventory
- Creating the pick lists and preparing the picking products
- Kitting and arranging the products
- Labeling the orders to the products
- Handling the return
The warehouse action time starts when the inventory is received and is shifted to the customers. Amazon and many other online companies have the same procedures for running the complex order fulfillment warehouses.
Benefits of using a fulfillment center
Fulfillment center offers the services of both warehouse and fulfillment center under the term “order fulfillment warehouse.” You can think about the warehouse if you need a large amount of space to store your products. However, you have to deal with packing, making an inventory, list, shipping, and delivering the product to the customers by yourself. But if you are a busy owner, the fulfillment center can help you the best. It can handle all the tasks on your behalf.
A fulfillment center offers the following advantages：
- Eliminate the inventory issues
- Get rid of packing the boxes and shipping the inventory
- Can efficiently deal with the increasing number of online order customers
- Get rid of running towards the post office lines every day
- As you are free, you can more easily focus on your business strategies and tactics
- It gives you the time to think about the bigger picture. Managers and other entrepreneurs can easily handle most of the jobs in which you waste your time.
- You can easily handover the inbounds and outbounds to the experts
- It divides the task into steps, and the expert for that job handles every step.
- Automated technology helps you go through the documentation process online, freeing you from recording the data manually.
1. Which type of company uses order fulfillment warehouses?
Amazon, Nature’s Ultra, BAKblade, and Rainbow OPTX use the order fulfillment warehouses.
2. How can I decide what the best option for me is? Fulfillment center or warehousing?
Suppose you have bulk products and only need a place to store your product, you should think about the warehousing. Warehouses are the best option for you if you can handle jobs related to your business. Just pay the rent and grow your business.
The second case is if you don’t have a place to place your product and also don’t want to involve yourself in packing, shipping, and inventory, then a fulfillment center is the right option.
3. Which type of customer dealing can I expect?
Although the goal of the fulfillment warehouse is to seek the perfect, there are still errors that you may face mostly. After the long delivery, the customer may receive a damaged or wrong product. They might lose the goods. Or someone could steal the merchandise. So, the end centers are responsible for the compensation. Otherwise, it may affect your customer dealing trust. The products may run out of shortage, and products may be replaced. So, you should deal with such queries firsthand.
4. Can the fulfillment centers deliver the products within a day or two?
Yes, fulfillment centers can give you the custom one-day or two-day delivery. However, it also depends on the type of products, technology, geographics, operations, and the carriers involved in the shipping that yields.
In short, fulfillment centers are far better than warehouses for handling the products and their shipping. Most online business companies use warehousing and fulfillment services to impede the complex business challenges.