How to Achieve Flexible Fulfillment in 2021

In short:

• New and increasingly popular customer engagement approaches — hey there, ecommerce! — are bringing in new sales that need new fulfillment channels.
• Your opportunity: Make fulfillment a breeze for your customers, and win both new and repeat business.
• Action items include connecting specific back-end systems — and beefing up one that you might’ve adopted in a hurry last year.

This past year saw a number of customer engagement trends accelerate. Ecommerce took off as consumers became comfortable shopping for more, and more types of, goods from their homes. Manufacturers learned how to sell directly to consumers, and many traditional retailers doubled down on their already effective omnichannel approaches.

In service of those new channels, marketers are pushing hard on their own new ways to attract attention, from engaging social media influencers to flooding consumers with retargeted ads. And it’s working. Those efforts are bringing in new business that helps offset losses due to restricted in-person selling. And, in many cases, those new sales are via new fulfillment channels.

This year, the challenge is keeping customers happy with fast and predictable fulfillment. Success is bound to your ability to manage inventory holistically.

Action Items: 3 Steps to More Flexible Fulfillment

1. Connect inventory, fulfillment and ecommerce.

Managing customer expectations as delivery services struggle to keep up is perhaps the most challenging part of opening and maintaining new sales channels. Businesses with storefronts can fulfill many orders and ease returns using existing facilities, leading to the rise of BOPIS. But success with “buy online, pick up in store” requires centralized inventory management, ideally connected to your order fulfillment system. Further, since ecommerce often accounts for a significant share of sales, those systems should connect to the ecommerce engine so that customers can see what’s in stock and when orders will be ready.

Whether or not your business has a network of stores, it’s smart to think about alternate fulfillment channels. If business is brisk and getting serious about new channels will make it more so, using third-party logistics (3PL) companies for fulfillment is a good short-term strategy — and potentially long-term as well, depending on your profit margin target and current fulfillment capabilities. If your operation is geared to fulfilling orders in pallet volumes, 3PL companies can help with smaller orders.

Working with a 3PL can provide your business with fulfillment flexibility.

2. Beef up new ecommerce systems.

In some cases, the ecommerce sites businesses stood up last year showed a fraction of available inventory or offered only rudimentary ecommerce functionality. For some, these sites were a first, quick foray into selling direct to consumers (D2C); for others, it was a way to sell unique goods, like PPE, that required a different channel than a direct sales team. Now it’s time to refine websites to offer more products, take better advantage of data for personalization programs and improve the ecommerce customer experience, including adding the ability to track shipments, estimate when orders will be fulfilled and accurately show available inventory.

Success with every bit of this requires tying fulfillment management to the ecommerce site as well as tracking new order fulfillment and inventory KPIs.

3. Automate fulfillment.

It’s a theme we returned to repeatedly in our full report. Automation is the next logical step once you’ve implemented cloud-based business and fulfillment/order management systems. A primary task when automating any process is to build in your business rules so that the system handles new transactions properly, minus the inefficient, legacy processes that are likely slowing you down now.

Some rules are fairly generic. Say a customer pays for two-day delivery; that order goes toward the head of the FedEx or DHL queue. Other rules may be highly specific to your business. Perhaps long-term or high-value customers get full shipments of popular products, while smaller or newer retailers may receive only partial orders. Without automation, managing complex business fulfillment rules is an error-prone and confusing matter for staff. With automation, initiatives to fine-tune business rules are more likely to come off without a hitch.