cost savings, fulfillment house, fulfillment services-posts, order fulfillment, orderfulfilment with e-commerce
Hidden Secrets to Reducing eCommerce Fulfillment Costs
Fulfillment and shipping costs can add up to be a large part of your costs and eat into your profit. Looking for creative ways to reduce these expenses is critical for your business. There’s a secret to reducing your Fulfillment costs, and that’s kitting.
How Kitting Works for ecommerce
Let’s say you are an on-line vitamin supplier. You sell a wide range of products. Upon analyzing your purchase data, you see that typically, people who order your multi-vitamins also order your Omega 3 capsules and a protein powder. Wow that’s great information on two fronts. One, you can have a special promotion; buy all 3 together and save 10%. This will increase sales. You may even consider offering this on a “daily deal” type website to further boost your sales. Now, here’s where the fulfillment savings come in.
Cost Reductions
Kitting Items Shipped Together:
Let’s say you’re charged 80 cents per item and $2.00 per order. This order would cost you $4.40 cents. Now let’s say you invest some time into special packaging for the 3 items and implement a kitting project, packing them together. Your cost is reduced to $2.80 per order. Some of this will be offset by the cost to kit, but if you have a reasonable volume of items to be kitted, your savings can be significant.
In addition to savings on the pick and pack, you can invest a bit of time in the right packaging that can reduce your UPS/Fedex or Postal Rates. There could be additional savings here as well.
You also may be able to save on the labelling process. If all the orders weigh out exactly the same, your fulfillment house can weigh and label in one step as part of the kitting process, saving you more.
Pre-Kitting Sales Promos:
One final tip is to organize your promotions in advance. Let’s say you are preparing for a “daily deal” type promotion where you are offering your products at a significant discount in limited quantities to attract new customers. You can work with your fulfillment company to pre-kit and pack the shipment in advance and save on picking charges. Plus, your customers will get a faster turn-around as the orders will be pre-packed and ready to go.
Here at Dare Marketing we have creative solutions for your ecommerce fulfillment projects. We’ve been in the business for almost 20 years and can help you grow your business by fulfilling your customer’s needs.
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