For ecommerce businesses, any frequent or notable mistake — such as delayed deliveries or packages arriving in poor conditions — can lead to lost revenue and dissatisfied customers. In fact, according to a Körber Supply Chain report, over 67% of consumers have experienced delivery delays in the past six months, with 84% stating they wouldn’t shop in the same store again after one poor experience.
With customer experience playing such a pivotal role in long-term brand loyalty, selecting the right order fulfillment services is key to your ecommerce success. But with so many options, how do you ensure you’re taking the right approach? Let’s discover how.
From sorting items to handling returns, retailers frequently use four ecommerce fulfillment methods to balance cost and delivery precision. Some adopt a hybrid approach, combining in-house fulfillment with outsourcing. Others experiment with dropshipping to test new markets with minimal risk. The one thing these methods have in common is the need to implement up-to-date technology for greater efficiency.
Let’s look at each fulfillment approach’s main characteristics:
Third-party fulfillment happens when companies outsource the processing of orders after they’ve been placed by customers and logged into an order management system (OMS). Once the OMS processes the details, it sends the information (such as items, quantities, and shipping specifics) to the third-party logistics provider (3PL). The 3PL then manages the next steps, including:
Hiring a 3PL for B2C and B2B order fulfillment services benefits mid-sized businesses that have established product lines but lack the infrastructure to manage warehouses and shipping nationwide.
Let’s take a look at this strategy’s main benefits:
Potential challenges with third-party fulfillment include limited control over customer experience and unexpected fees, such as accessorial charges, which can erode your profit margins. To mitigate these logistical issues, businesses should carefully evaluate carrier contracts, maintain open communication, and collaborate closely with providers to align expectations and costs.
If you choose to self-manage your ecommerce fulfillment, you are responsible for the complete process, from inventory to shipping and return requests. This type of strategy is ideal for large and established businesses, as it enables complete control over the customer experience. However, it is resource-demanding — requiring significant investments in staff, technology, and warehouse space.
Using a hybrid approach to combine self-fulfillment and third-party services optimizes your online store operation for cost and fleet flexibility. For example, during peak seasons, businesses can leverage 3PL services to handle surges in orders without overburdening their in-house teams.
Similarly, hybrid fulfillment enables strategic allocation for retailers offering varied product categories. You can manage specialized items in-house while outsourcing other inventory to optimize delivery efficiency.
A hybrid ecommerce order fulfillment process works well for mid-sized businesses but requires advanced coordination to avoid problems such as misaligned stock levels or delayed shipments. Comprehensive end-to-end solutions like the Shipium Platform mitigate these inefficiencies: our Fulfillment Engine uses inventory data across your operations, ensuring that orders are fulfilled from the right locations at the right time, eliminating delays and helping you make accurate delivery estimates.
Dropshipping is a fulfillment method in which businesses send products directly from suppliers to customers, bypassing inventory storage. This model works well for small to mid-sized retailers who want to expand product offerings with the least possible risk or upfront capital. It’s an ideal choice for startups or companies testing demand in niche markets.
Although cost-effective, when using this type of online order fulfillment service, ecommerce businesses sacrifice control over shipping quality and delivery promises, as they rely entirely on suppliers to manage these critical aspects.
Optimizing order fulfillment is a great way to ensure a seamless customer experience. A delay at any stage — be it inventory mismanagement, slow picking and packing, or carrier issues — can result in negative brand reviews and lost deals.
Follow these five steps to get started:
Without the shipping technology to track, process, and fulfill orders in real time, inefficiencies can quickly snowball into costly delays. To build a comprehensive modern order management process:
Misplaced or poorly planned inventory leads to stockouts. That’s why it’s important to optimize warehouse locations — placing products as close to customers as possible — and their internal layout to reduce travel time and overall errors. Consider these tips:
A disorganized picking and packing process requires workers to spend more time searching for items, often traveling unnecessary distances within the warehouse. These inefficiencies delay ecommerce order fulfillment and increase labor costs. To streamline operations, use these targeted strategies:
See how our Package Planner API can help you optimize your cartonization strategy.
An efficient shipping process workflow reduces transit times, minimizes costs through strategic partnerships, and ensures reliable delivery. For businesses seeking the best ecommerce fulfillment services, optimizing this process involves:
Discover 10 strategies to decrease shipping costs and improve your bottom line.
Returns are a fact of ecommerce: according to the National Retail Federation, the annual return rate in 2024 is nearly 17% — or $890 billion of merchandise purchased online. However, a well-optimized system can transform returns from a pain point into a strategic opportunity. Follow these best practices:
Whether you are choosing a new software solution or outsourced warehousing, finding the right partner fit for your business requires considering its specific size, needs, and growth goals.
Here are our insider tips on how to identify the best order fulfillment service for ecommerce companies:
Shipium’s end-to-end platform simplifies logistics and helps businesses move orders from shelves to customer doorsteps faster and more cost-effectively. We integrate into all your existing systems, such as OMS and WMS, to streamline fulfillment decisions upstream and downstream, helping you confidently make delivery promises you can keep.
With our shipping solution, you get:
Book a demo to see how Shipium helps you manage your order fulfillment services and boost customer satisfaction.