Outsourcing is nothing new in the eCommerce world. Many of the most successful companies rely on outsourcing from product photography to video production services. But what about picking and packing?
It’s an often overlooked aspect of eCommerce operations that can majorly impact your company’s bottom line if you need to be more careful. Here are seven reasons why outsourcing your eCommerce picking and packing should be at the top of your list.
Picking and Packing: A Hassle for eCom Entrepreneurs
eCommerce sales are estimated to hit $8.1 trillion by 2026, and entrepreneurs are rushing into the space. eCommerce businesses are growing in number, size, complexity and headaches.
As more eCom entrepreneurs realize how much time it takes to manage their inventory, they turn to outsource as a solution.
Outsourced eCommerce Picking and Packing offers advantages that allow you to focus on your core business while still getting products shipped quickly and efficiently at lower costs.
Frees Up Space
Space is a premium in eCommerce warehouses. In the U.S., merchants hold $1.35 in stock for every dollar of sales. This means they must invest heavily in warehouse space to maximize profits and scale up their business. While you can rent or buy new warehouse space, this comes at a high cost. It will take you time before your investment ultimately pays off.
Instead of investing money into buying or renting more space or hiring more people for picking and packing operations that could be used for other purposes, why not outsource the work to an experienced third party?
An outsourced eCommerce warehousing service will have its storage facilities and employ personnel better equipped than your in-house capabilities. They will handle this job efficiently and all at a fraction of the cost.
Saves You a Lot of Time
As an eCommerce entrepreneur, you know that time is money. Your business will benefit immensely if you focus on what’s essential to your company’s success rather than wasting valuable hours trying to hire, train and manage pick-and-pack staff.
Outsourcing these services can save up to 70% of your time and resources compared with having an in-house team handling them.
Just think about how many hours are spent recruiting employees who might not be interested in their positions. Or training new hires that are still learning the ropes. Not only that, but there’s also the risk of losing them if they leave for another job within a short period. This means lost money, time and lost productivity.
Accuracy is paramount in eCommerce. The most successful businesses boast accuracy levels of 90% or higher, which is commendable and necessary. If a package arrives at its destination with a missing item or damaged goods, you can expect an angry customer to make their displeasure known. A study found that 75% of shoppers would only return to an online store if they received good service.
So how do you improve accuracy? It all comes down to choosing the right partners and putting them in place early on. Outsourcing eCommerce picking and packing allows you to move faster than hiring in-house staff who need training, onboarding time and more resources just for their start-up phase before they’re ready for entire production operations.
Reduces Your Operating Cost
Outsourcing your eCommerce picking and packing to an experienced third-party logistics provider can reduce your operating cost. This will help you save money and increase profitability. The inventory cost is reduced because products are shipped directly from the supplier to the customer. You don’t have the expense of storing those products in your warehouse.
Warehouse space is also reduced. No additional square footage is required to house items being picked and packed by an outside company. This means you’re paying less rent or lease costs monthly, which translates into more profit and a lower total cost of ownership over time (TCO).
Maintenance costs are lowered because less equipment needs to be purchased or hired out using outsourced services. Instead of hiring employees directly on staff at the warehouse, fewer repairs need fixing due to damaged equipment.
Ensures the Employee Safety in the Warehouse
Safety is one of the most important reasons to outsource your e-commerce picking and packing. It’s not just about ensuring that your employees are protected from injury but also that they can focus on the task without worrying about injuring themselves.
Amazon has received a lot of criticism for its treatment of workers, including working conditions in its warehouses and retaliatory practices against employees who try to speak up about them. According to a new analysis produced by the Strategic Organizing Center, the injury rate at Amazon warehouses is double that of non-Amazon facilities. In 2021 alone, more than 34,000 significant injuries occurred on the job at Amazon warehouse locations.
This data shows why it’s essential for any company focused on workplace safety. Hiring third-party vendors experienced with picking and packing processes will ensure their employees won’t get hurt or have accidents since they are professionally trained.
In conclusion, eCommerce fulfillment is an intricate and complex process that can be difficult to scale. If you’re looking for a way to grow your business without adding more staff or taking on expensive warehouse space, outsourcing your picking and packing may be the answer. That’s all about outsourcing picking and packing. Give this idea a thought, implement it and see how your revenue goes up along with your reputation.