In-House vs. Third-Party Order Fulfillment Services: Which Is Right for You?
Running an online business often comes with its fair share of challenges. One of the biggest decisions you must make is whether to stick with your in-house order fulfillment service or partner with a third-party provider.
In-house services often work well for small brands operating within a limited geographic location. However, once your business starts to grow and your garage or spare bedroom can no longer hold your inventory, then it is time to switch to a third-party order fulfillment services provider.
Differences Between In-House and Third-Party Order Fulfillment Services
§ In-House Order Fulfillment
Under in-house order fulfillment, you manage everything, from inventory management to packaging and shipping orders. This type of fulfillment works for brands covering a small geographic location.
§ Third-Party Order Fulfillment
This involves partnering with a specialized logistics partner that handles storage, packing, shipping, and returns on your behalf. This is ideal for large or multichannel businesses with large inventories and state-wide or international orders.
Advantages of Third-Party Order Fulfillment Services
3PL companies specialize in offering order fulfillment services for multiple brands and stores. They handle everything from inventory management to shipping and returns. Let’s look at some of the top advantages of using third-party order fulfillment services, such as Packageman.
§ Scalability
This is one of the biggest pros of using third-party order fulfillment services. 3PL firms are built to handle volume all year round. This means you can scale your business without worrying about issues related to warehousing or expanding your shipping zones.
§ Reduced Costs
Picture managing a multichannel online store in your garage. Things can get hectic over time, and you might find yourself spending more. However, third-party order fulfillment services have you covered since they eliminate the need for you to own a warehouse, fulfillment staff, and equipment.
§ Help You Focus on Business Growth
With 3PL, you can channel your efforts towards building your business and strengthening your brand. You don’t have to worry about logistics or tracking inventory records because all that is covered by your order fulfillment services provider.
Advantages of In-House Fulfillment
Building an in-house fulfillment service has its fair share of pros. Below are some of the advantages.
§ Control Over Operations
Whether you work alone or have a few employees, you oversee every aspect of your business, from packaging to shipping. This level of control is great, especially if you want to add a personalized touch to your brand.
§ Direct Customer Feedback
You are closer to your customers, meaning you handle every complaint individually. This plays a huge role when it comes to resolving issues, handling returns, and building proper customer relationships.
§ Cost Savings in Certain Circumstances
In-house order fulfillment can be a money saver for small businesses and startups. For example, turning your spare bedroom or garage into a warehouse saves on rent money. You also won’t have to worry about paying recurring monthly 3PL service fees.
Wrapping up
There is no perfect or one-size-fits-all solution when it comes to order fulfillment services. Choosing between in-house and third-party order fulfillment will largely depend on your business’s needs.
