outsourcing fulfillment services

Do Outsourcing Fulfillment Services Make Sense for Your Small Business?

By Pier Ronzi

It’s a problem most business owners and entrepreneurs have to face at some point. You want to grow your business, but day-to-day tasks keep you too busy to concentrate on what you need to do to expand.

At some point, you’re going to have to prioritize what work needs you to oversee it and what can be moved elsewhere. This is a difficult concept for a lot of small business owners, the thought of not having complete oversight of every minute action within their business fills a lot of people with dread. Unfortunately, this hinders growth.

Unless you work within the industry, the chances are, when you imagined yourself running your own business, you didn’t picture packing boxes and printing labels. If we take this as a starting point, it begins to make sense to outsource your fulfillment services. It can let you concentrate on growth and what you did imagine yourself doing when you thought of running a business.

Perhaps you’ve started to consider moving your fulfillment off site and are weighing up the benefits of doing so. Whatever you’re thinking, here’s a brief list of reasons for why outsourcing fulfillment can make a lot of sense for a small business.

Save Money

You might think that this isn’t the case, with you having to pay for an external company. Indeed, processing your orders yourself is free on the whole. However, in the long run, using a fulfillment company will save you money because they are able to combine all of their orders and leverage a cheaper price for shipping.

Save Time

This could be one of the most important points on the list. As a small business owner, your life will never stop. It’s absolutely vital to be able to prioritize what work you need to do. By outsourcing the unnecessary tasks, you can concentrate on more business positive actions.

Save Space

It’s not hard for your products and packaging to take over your work area. Firstly, this clutter would be removed if handed over to an external company. Secondly, if you’re having to pay for a warehouse or a larger work space to accommodate for your stock, you could remove this overhead and offset it against the cost of the fulfillment service.

Increase Precision

Errors can cost businesses a lot of money. As a small company, these expenses can easily be the difference between turning a profit or not. A fulfillment company is dedicated to the process of getting your product to where it needs to be, intact and on time. You probably have a hundred and one different tasks on your list. This could mean rushing a job, increasing the chance of error.

Take Advice from Experts

There will always be laws and regulations that you have to negotiate when distributing your products. Even more so if you are looking to ship internationally. While it is important to have an understanding of this, learning all the regulations and staying up to date with them takes a lot of time. A fulfillment company will be experts in this field, saving you a lot of hassle making sure you are complying with the latest legislation.

To Outsource or Not?

Despite these reasons, there are occasions when outsourcing is not a good option for you. You have to take an honest evaluation of where your business is at. The first reason for it not being a good idea is if you have a limited cash flow. You have an obligation to pay a contract you sign up to and if you can’t meet that, then it’s a bad idea.

The second reason is if you run an extremely niche business. Most fulfillment companies will offer a high-quality tailored packaging service. However, if your product has highly specific requirements, then it might be better to handle this internally.

In summary, there isn’t an exact tipping point as to when outsourcing will work for you. It depends on your needs, budget, and targets that you’d like to hit. Establishing these will almost certainly help you in making the decision. There is a huge benefit from working with a fulfillment company, if your business is ready to make that step.

Photo credit: Packaging service in warehouse from cybrain/Shutterstock

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Pier Ronzi
Pier Ronzi is the Co-founder and CEO of Weengs, a UK-based startup innovating the fulfillment sector. With a focus on SMEs, Weengs’ solution helps save small business owners time, money and space on fulfillment.

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