4 min read

How to Increase Average Order Value With Improved Delivery Performance?

May 6, 2021 by Srishti Arora - 4 min read

Average order value is a crucial metric to track for the success of your business. If you want to track growth and plan for the increase in your incoming orders, you need to keep track of your average order value. Many eCommerce entrepreneurs do not understand the relationship between a positive delivery rate and average order value. You can put in all efforts to make your store stand out from the competition online, but if your customer’s delivery experience lacks, there is a meager chance that they will shop from your store again.

Therefore, it is essential to enhance your buyer’s delivery experience and keep them happy to ensure that your impression is long-lasting. To understand how delivery performance helps in improving your average order value, you need to understand what average order value is. Let’s get started.

What is Average Order Value (AOV)?

Average order value refers to the average amount of money a buyer spends on one order. It is calculated by dividing the revenue by the total number of orders. Average order value gives you an insight into the shop and runs of your buyers and which products are doing well in your store. If the average order value is high, you can infer that customers are shopping for multiple items or shopping for more items from a single category.

If you know the average order value, you can assess your product pricing, store layout, shipping strategies, etc. 

Role of Delivery Performance in Improving AOV

Your delivery performance plays a significant role in improving the average order value.

For example, your customer orders from your store on 15 April 2021. It is expected that we receive the product from you on 17 April 2021. However, due to technical difficulties, the product delivery gets delayed, and the customer received the product on 20 April 2021. This directly impacts the customer experience, and they cannot trust your brand with fast deliveries. The buyers’ expectations are hurt, and there is very little chance that they shop from you again. Hence, this impacts your average order volume as the delivery performance is not adequate. 

A seamless delivery experience can help you establish a positive relationship with the buyer and positively influence their future shopping decisions. The delivery of an order completes the chain and is the final litmus test of whether the customer will like your brand or not.

Not just this, with an upbeat delivery performance you automatically enable your brand to be promoted by word of mouth of happy customers. Getting a good quality product is just one end of the bargain. Getting a seamless delivery is equally important for customers today, and they do also mention it in whatever reviews they write. 

Therefore, improving your delivery performance must be a primary goal of your business. You can only improve your delivery performance by opting for a streamlined and simplified fulfillment process. Many sellers choose to self-fulfill orders. This causes some discrepancies as customers do not always receive the products on time or most pin codes are not serviceable because they only ship with one courier partner. 

Let’s look at the most brilliant way to simplify our fulfillment operations and improve delivery performance to ensure a high average order volume. 

Best Way to Improve Delivery Performance – Outsource Fulfillment With SRF

Shiprocket Fulfillment is an eCommerce fulfillment company that helps you simplify your fulfillment operations by managing incoming orders, inventory, and the processing of shipments. All you have to do is send across your eCommerce inventory to our fulfillment centers located across the country. Our team will look after everything else, including picking, packaging, shipping, returns, etc. you can sync your marketplaces and websites to ensure that no incoming order is missed. We will process them with 99.9% accuracy. 

By storing your products in a PAN-India network of fulfillment centers, you can deliver 3X faster, reduced shipping costs by 20%, decrease fulfillment costs by up to 50%, declined RTO orders, and lower way discrepancies as the product stored are closer to the buyers delivery location. 

SR Fullfilment

All these measures will help you improve your delivery performance by a large margin, and you can reach much more customers in a shorter period. This will help you enhance your average order value as you can fulfill the needs of more customers situated in different locations across India. Not just average order value, you can also increase your brand connect by establishing yourself as a D2C brand providing services like Amazon or Flipkart. 

Final Thoughts

Increasing your average order value (AOV) depends on several factors. Enhancing your delivery performance is a major one. Hence, you must focus on this and try to improve it by implementing measures to strengthen your eCommerce fulfillment process

Shiprocket Fulfillment features
May 6, 2021 by Srishti Arora

4 min read

How Can You Provide Flat Rate Shipping With 3PL Fulfillment Providers?

May 4, 2021 by Srishti Arora - 4 min read

Shipping margins are an essential component of your eCommerce business. If you want to run your eCommerce business successfully, you need to calculate these margins and spend on each element accordingly. If you are not shipping affordably, you are paying more than you should and bleeding losses. 

As an eCommerce entrepreneur, you must always be on the lookout for ways to reduce shipping costs. Flat rate shipping is one such method of reducing your overall shipping costs. Sometimes, it can get challenging to provide free trade shipping entirely on your own. Here is where 3PL fulfillment providers come into the picture. 3PL fulfillment providers can help you provide flat rate shipping and give you other means to save on fulfillment and shipping costs. Let’s have a look at how that is possible. 

What is Flat Rate Shipping?

Before understanding the importance of lateral shipping and how 3PL fulfillment providers can help you, we need to understand what flat rate shipping is and how it works. 

Flat rate shipping is a form of shipping the product in which the weight of a package does not affect the cost of shipping.

In ideal cases, you pay for the shipping depending upon the – volumetric weight of the package that includes the length, breadth, and height divided by 5000. 

However, in flat rate shipping for packages lying in a specific weight range, you pay a fixed cost. For example, FedEx has several flat rate slabs between 0 to 5 kg or 5 to 10 kg. If you opt for these, your shipment weight maybe 1 kg or 3 kg, but you will pay the exact shipping cost. 

Importance of Flat Rate Shipping

Flat rate shipping plays a significant role in your eCommerce fulfillment process if you ship products of nearly the same weight range. It helps you eliminate the need to constantly way your products and calculate shipping costs accordingly.

For example, if you ship cosmetic products that lie in the range of 100-500 g, it is redundant to be the shipment every time. Instead, you can opt for flat rate shipping and ship products at the same shipping rate every time. 

SR Fullfilment

How Can 3PL Fulfillment Providers Help With Flat Rate Shipping?

Shipping costs are also affected by other zones to which you ship. If you have the pin code you ship to locations far off; the shipping charges will only increase. Courier companies provide flat rate shipping only for a particular weight slab in a specific zone.

3PL fulfillment providers help you provide flat rate shipping as they store inventory in a network of fulfillment centers located across a critical region. This way, you can save the cost of inter-zone shipping and provide a flat rate shipping for your orders. 

You can get exceptional order processing, reduced shipping costs with flat rate shipping, and accurate delivery. 3PL fulfillment centers can help you ship better at the most considerable prices.  

Save on Shipping Costs With Shiprocket Fulfillment

Shiprocket Fulfillment is one such fulfillment provider in India that can help you provide flat rate shipping to your customers and considerably save on shipping costs.

We have a network of fulfillment centers located across India in cities like Delhi, Gurugram, Bengaluru, Mumbai, and Kolkata. If you store your inventory in every fulfillment center of Shiprocket Fulfillment, you can process orders efficiently in every zone in the country and deliver 3X faster. This way, you can provide flat rate shipping on every order across your website.

Not just this, with Shiprocket Fulfillment, you can reduce weight discrepancies as every fulfillment center has an automated falcon machine that records the weight of shipment as it would be recorded in a courier hub. With such sophisticated infrastructure, you can efficiently deliver orders with utmost accuracy and streamline your shipping and fulfillment process.

At Shiprocket Fulfillment centers, we also take care of the order picking, processing, and inventory management operations that give you complete relief from the entire fulfillment process. If you self-fulfill orders and are looking to take off the load from your shoulders to expand your business, outsourcing to eCommerce fulfillment centers like Shiprocket Fulfillment is a great option. 

Conclusion

eCommerce fulfillment can be a tough nut to crack if you do not plan your shipments and deliveries properly. However, if you outsourced or eCommerce fulfillment operations, you can manage all of this without doing the hard work. As far as flattery tripping is concerned, it can be a boon for your business if you plan and progress accordingly. 3PL fulfillment providers can help you reduce shipping costs and give you a great chance to provide flat rate shipping across your website orders.

Shiprocket Fulfillment features
May 4, 2021 by Srishti Arora

6 min read

A Deeper Look at Inbound and Outbound Logistics and Fulfillment Processes

April 13, 2021 by Srishti Arora - 6 min read

eCommerce logistics management is a taxing task that requires you to be attentive at all times. It includes several processes that need to run in synchronization so that the results are enhanced and maximized. We have talked about several fulfillment processes and the steps involved in running the process but never discussed their segregation based on their place in the chain. 

If you are an eCommerce business, it goes without saying that you manage several goods each day and push around a lot of stock to deliver products to your customers successfully. You run this stock with the help of inbound and outbound logistics processes that help you run the show in a streamlined manner and process orders systematically. 

Inbound and outbound logistics and fulfillment processes are two sides of a coin that help you stabilize your supply chain and optimize the process or maximized output. 

According to research, the inbound and outbound logistics process can today represent approximately 60% of the total costs. Therefore, they need to be addressed appropriately and dealt with carefully to make sure the supply chain is not disrupted at any instance. 

Let’s have a look at what these processes are and what techniques do they consist of. 

What is Inbound Logistics and Fulfillment?

In one, logistics and fulfillment processes refer to the steps involved in receiving the goods and storing them in the warehousing fulfillment facility. These could include raw materials, finished goods, or supplies from a manufacturer.

There are several steps involved in receiving goods in our shop, fulfillment center, or warehouse. These include quality control, barcoding, and putting away. Let’s have a look at them in detail. 

What Processes are a Part of Inbound Logistics and Fulfillment?

Receiving of Goods

Raw material or finished goods are brought into the facility by a truck or vehicle that is docked in a specific area, and the products are unloaded from it. 

The goods are then received in the warehouse, and a gate receipt note is produced for the stock. 

Quality Check

The next step in the process of inbound logistics is a quality check. Each SKU undergoes a quality check to ensure that there are no damaged goods that have been sent so that the orders can be processed seamlessly whenever there is a need. 

Barcoding

After the quality check is done successfully, the products are barcoded to be easily located within the facility and quickly packed so that there are minimal delays in order processing. 

Putting Away of Inventory

The last step of the inbound logistics process of putting away inventory. Usually, fulfillment centers or retail shops are divided into idols racks in which the barcoded bins are placed. The inventory is stopped in these bins so that the barcodes can be matched and can be easily located whenever required. 

What is Outbound Logistics and Fulfillment?

Outbound logistics and fulfillment refer to the process of sending away goods. In eCommerce and fulfillment processing, handling the goods after an order is received until they are delivered to the customer. It involves a significant part of the last-mile logistics and the order processing that takes place before that. 

What Processes are a Part of Outbound Logistics and Fulfillment?

Order Management

Order management refers to handling incoming orders and syncing them with existing inventory to ensure that enough stock is available for processing the order. 

Picking

After receiving an incoming order, the next step is picking the order from its designated place in the facility. Usually, a picking operator is a sign for the order, and they collect the SKU by scanning the barcode present on the product and the bin. This ensures accurate transparency and precise processing. 

Packaging 

After the order is picked from its spot, it is taken to a packaging station, packaged to meet the customer’s requirements. It is also labeled here and moves forward for further processing. 

Weight Measurement

The next step is weight measurement, where the final shipment is weighed, and the dimensions are recorded to measure the volumetric weight.

Shipping

Lastly, the product is handed over to the courier company for shipping, and it is then connected to a central courier hub which then takes it to the customer’s doorstep. 

SR Fullfilment

How to Enhance Inbound and Outbound Logistics?

Now that you have understood what is included in the inbound and outbound logistics processes, the next concern is how you can enhance the inbound and outbound logistics processes to maintain harmony between operations and improve the final output. Here are a few suggestions for the same. 

Reduce Costs

The first big step in optimizing inbound and outbound logistics processes is by reducing the inventory costs. If you invest in the infrastructure yourself, the price can increase drastically if you improve your suddenly stock count. Therefore, you need to invest in optimum inventory so that you do not overstock it. You will need a steady supply for your supply chain management so that you can make the most out of your fulfillment process without having any liabilities. 

Use a Warehouse Management System

A warehouse management system can help you figure out the most optimal floor plan, synchronize orders with inventory, keep track of the inventory, forecast incoming orders, and improve the warehouse management process by a considerable margin. It can help you automate the process and save you a ton of manual work.

Outsource to a 3PL Fulfillment Provider

The best option to optimize the inbound and outbound logistics process is to outsource your eCommerce fulfillment operations to a 3PL fulfillment provider. A 3PL fulfillment provider handles everything included in eCommerce fulfillment and shipping for your business. This would mean that you would not have to individually take care of receiving orders, processing them, and shipping them.

A suitable 3PL fulfillment provider would be Shiprocket Fulfillment. With Shiprocket Fulfillment, you can stock inventory in fulfillment centers across the country, and all you have to do is just send across your stock to the warehouse. All the other operations will be taken care of by the resource present in the warehouse. You can make the most out of the spare time and money to grow your business and invest in other facets. You will get 3X faster delivery as you store products closer to your customers, reduce shipping costs, and ower weight discrepancies, which is a win-win situation for your business. 

Final Thoughts

Inbound and outbound logistics is a critical part of any eCommerce business. When we talk about the fulfillment process, it is run by the inbound and outbound justice process. Therefore, you must individually pay attention to each aspect of these logistics management procedures to ensure that you can draw the maximum output and yield for your eCommerce business. 

Shiprocket Fulfillment features
April 13, 2021 by Srishti Arora

6 min read

5 Reasons You Should Opt for 3PL Reverse Logistics Management

March 9, 2021 by Srishti Arora - 6 min read

According to research by invespro, at least 30% of all products ordered online are returned. This means that online shopping is very quickly imitating brick-and-mortar stores. Even though the purchasing tendency is moving towards online shopping, the buyer’s subconscious direction of trying before buying remains. 

Therefore, it has become imperative for online sellers to offer returns on all their products. Since all the market players provide it, most sellers can provide this offering as customers do not prefer shopping from websites that do not offer a return or exchange policy. In many cases, customers also receive damaged products or wrong items that require you to arrange for a return shipment.

Even though a return policy may seem very lucrative on papers, reverse logistics can be a nightmare for eCommerce sellers like you. Since you also need to bear the cost of shipping the return to your warehouse, it causes a massive hole in the pocket. It also tends to disrupt your entire inventory as the product is no longer viable for further use. 

This is where 3PL fulfillment providers come into the picture. They can be an absolute blessing for your business if you let them handle the fulfillment operations for you. 

Let’s see how you can simply reverse logistics management with a 3PL fulfillment provider. 

What is Reverse Logistics?

Before we move into the benefits of hiring a 3PL fulfillment provider, let’s look at what reverse logistics is.

Reverse logistics refers to the transportation, repurposing, and disposal of goods after the customer receives the product. This means it includes shipping the products back to the seller’s warehouse or pick-up address.

Why is Reverse Logistics an Essential Component of Your Fulfillment Supply Chain?

If you think that the fulfillment cycle ends after the product is delivered to the customer, you are mistaken. The eCommerce world is developing rapidly, and the customer experience cycle also includes return management. Reverse logistics plays a critical role in determining the positive customer experience by arranging a smooth return journey. 

Here are few reasons why it is so important – 

Customer Retention

Since reverse logistics helps handle return orders, it plays a critical role in retaining existing customers. If a customer has a bad experience with your product, reverse logistics helps me get right by arranging a seamless return. This enhances the customer experience by many phones as the customer can trust you with their shopping. Reverse logistics also plays a crucial role in establishing strong customer relations.

Reduced Losses

Most times, in a return order, products or salvageable. This means that the consequences can be used or sold again. Therefore, an established reverse logistics system helps you reduce losses by optimizing the process and getting the products to the warehouse much quicker. 

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Fast Service

If your return order management service is not quick, it can lead to a negative customer experience. Therefore, reversed logistics helps you establish a fast service with your brand and customers. Fast service indicates proactiveness, and quick reverse logistics can help you determine just that. 

How Can 3PL Providers Help?

Most D2C and small business sellers cannot provide fast and efficient reverse logistics management for their business. This is because different courier partners have different return order processing rates and usually are very high. Since return order management and reverse logistics form the last leg of your entire fulfillment supply chain, there is a high chance of facing losses regarding returning shipments. 

With 3PL fulfillment providers, you can be assured about end-to-end fulfillment management. They take care of all operations, starting from inventory management and storage up to return order management. Their reverse logistics management is much more sorted. Here is how they can be a boon for your business – 

Convenient

3PL providers are designed in a way to make tasks convenient for you. You outsource your entire eCommerce fulfillment operations to your 3PL providers, and they assign resources to manage it for you. All the functions after receiving an order and even handling returns are the 3PL fulfillment provider’s responsibility. Since the return orders are taken directly to the fulfillment provider’s warehouse, you do not need to worry about accepting and arranging returns. The 3PL fulfillment provider does it for you.

Inclusive of all Operations

All fulfillment operations are included in the 3PL fulfillment provider’s offering. This ensures that the 3PL provider handles all reverse logistics operations, and they take care of every incoming return order. They arrange for the courier network to collect returns by themselves. 

Latest Technology

The fulfillment centers are equipped with the latest technology to help you process and deal with return orders very efficiently. Since this technology is the latest, automated, and scalable, you do not need to worry about picking every reverse logistics operation yourself. 

Faster Processing

The products are processed faster as there is a very efficient system instituted for the same. Along with that, fulfillment centers have skilled resources for the reverse logistics tasks that process the request with couriers and accept parcels at a much faster rate. 

Closer to Buyers

Last but not least, fulfillment centers are placed in different locations. Your fulfillment provider gives you the chance to store products closer to buyers. This means that processing returns also becomes a much cheaper and faster process for you. 

Choose the Most Reliable 3PL Fulfillment Provider – Shiprocket Fulfillment. 

Shiprocket fulfillment is a 3PL fulfillment provider that helps your store and ship orders from fully-equipped warehouses situated in multiple critical locations across the country. 

All you need to do is send your product inventory to our fulfillment center, and we will handle the entire order fulfillment and return process for you after that. 

You get several benefits like one-day and two-day delivery, a 20% reduction in shipping costs, and seamless return order management. 

The fulfillment centers also process all inward return orders. 

Final Thoughts

Suppose you want to reduce the cost for reverse logistics and also handle return orders like approval. In that case, it is intelligent to tie-up with a 3PL fulfillment provider that can help you achieve all of these at discounted costs. Do reach out to us if you want to process return orders faster with a simplified reverse logistics system. 

Shiprocket Fulfillment features
March 9, 2021 by Srishti Arora

6 min read

Why is Shiprocket Fulfillment an Intelligent Choice for Small Business Owners

March 16, 2021 by Srishti Arora - 6 min read

Did you know that 38% of online shoppers will abandon their order if the delivery takes longer than a week? 

How does that play out for your D2C business if you need to deliver products to people living in remote locations in India? 

Will you leave out that target group or work to improve your fulfillment operations to deliver faster will improved order accuracy? We are sure you will choose the latter. However, if not appropriately handled, fulfillment operations will become a daunting task where you will be spending more money than anticipated to achieve maximum efficiency. 

To make this task more comfortable for you, we have a solution – Outsource fulfillment operations!

You must be wondering that being a small business, you do not have the capital to spare for outsourcing anything. When you analyze the option objectively, you will find that outsourcing can help you save on expenses and provide much superior service to your customers. 

Let’s dwell deeper and see how Shiprocket Fulfillment can lower your fulfillment costs and provide you with better performance. But first, let’s see what Shiprocket Fulfillment is and what it offers. 

What is Shiprocket Fulfillment?

Shiprocket Fulfillment is an end-to-end fulfillment solution design for businesses of all sizes. It is an all one solution that gives you a chance to outsource your inventory management, warehouse management, order management, and shipping operations to a team of skilled professionals.

With Shiprocket Fulfillment, you can store your inventory in thoroughly equipped fulfillment centers located across India in Delhi, Mumbai, Gurugram, Bengaluru, and Kolkata. With this, you can deliver faster to your customers and also save on shipping costs. 

Since you can do without investing in additional warehouse infrastructure, Shiprocket Fulfillment enables you to focus on other key metrics and aspects of your business. 

Cost Savings With Shiprocket Fulfillment

We speak about cost savings with Shiprocket Fulfillment, but you might wonder if it is practically possible. Well, let us understand with a practical example. This will give you a better idea about how you can save on fulfillment costs with Shiprocket Fulfillment and utilize that capital on other aspects to grow your business. 

Let us assume that you receive 1000 orders every month. The average weight of each order lies between 0-500g. 

Now let us look at this situation in two scenarios: Without Shiprocket Fulfillment and with Shiprocket Fulfillment. 

Without Shiprocket Fulfillment 

If you own your warehouse and opt for self-fulfillment, your expenditures would look like this – 

Fulfillment AspectsMonthly Expenditure
Workforce (2 personnel)₹20000
Storage Area (Rent)₹15000
Maintenance & Overheads₹7000
Stationary Cost (Label, manifest, invoice, etc.)₹6000
Sum Total₹46000
Note: All values mentioned are hypothetical and are only used for demonstration purpose

Now, if you process 1000 orders every month, 

Hence the fulfillment and processing cost  = Total Monthly Expenditure/ Inventory Stocked. 

46000/1000 = ₹46

Fulfillment and processing cost without Shiprocket Fulfillment  = ₹46/order

Now let’s look at the same scenario but with Shiprocket Fulfillment.

With Shiprocket Fulfillment

Fulfillment Costs

The fulfillment fee per order is ₹18*

Assuming you process 1000 orders from our fulfillment center, 

Total fulfillment cost = Orders processed * fulfillment fee per order

        = 1000 * 18

        = ₹18,000

Average fulfillment fee per order₹18
Total Orders Processed1000
Fulfillment Cost1000 * 18 
Total Fulfillment Cost₹18,000
Note: All values mentioned are hypothetical and are only used for demonstration purpose
*rates as per the gold tier (0-3000 orders/month) of Shiprocket Fulfillment 

Storage is free for 30 days when you send your inventory to our fulfillment centers. 

Total Monthly Costs

Order Fulfillment Costs₹18,000
Storage Costs₹0
Total Monthly Cost₹18,000
Note: All values mentioned are hypothetical and are only used for demonstration purpose

Hence, the fulfillment and processing cost  = Total Monthly Expenditure/ Orders Processed. 

18,000/1000 = ₹18

Fulfillment and processing cost with Shiprocket Fulfillment  = ₹18

Shiprocket FulfillmentSeller Fulfilled
For 1000 orders₹18/order₹46/order
SR Fullfilment

Therefore, it can be concluded that if you outsource eCommerce fulfillment to Shiprocket Fulfillment, you can save more than 50% on your fulfillment costs.

Similarly, for shipping, you save around ₹15 – 20 for every 500g shipment. 

If you want to understand how cost-saving works with Shiprocket Fulfillment, reach out to our experts today! 

How Can Small Businesses Benefit from Shiprocket Fulfillment?

Multiple Fulfillment Centers

Shiprocket Fulfillment has multiple fulfillment centers located in several locations across India. These fulfillment centers are spread out across zones so which helps reduce delivery time by a considerable margin. For example, if you have your warehouse in Delhi and want to ship a product to Bangalore, the usual delivery time would take 3 to 5 days. However, if you stock your products with Shiprocket Fulfillment and let us fulfill your orders, the delivery time would reduce by three days as the product is stored in Bangalore. Also, the shipping cost would be lower. This will help you save up on shipping costs and also improve the customer experience.

Advanced Technology

Shiprocket Fulfillment deploys the best technology in its fulfillment centers. All the warehouses are equipped with the latest warehouse management software to manage your incoming orders and process them in the fastest possible manner. We also have a falcon weighing machine in all our warehouses that enables us to click pictures of the final package product and record the dimensions to help reduce the weight discrepancies by a large margin. If you try to install all the latest technologies in the warehouse, the initial capital investment can be too high for small to medium enterprises. 

Skilled Team

We are tired Shiprocket Fulfillment Testimonial is trained to fulfill orders in a fast yet accurate manner. This improves the quality of fulfillment and also gives you greater control over the order accuracy. We ensure that our team follows the best standards for inventory management, order processing, and shipping. 

Faster Delivery

As your store products closest to customers, you can provide 3X faster delivery and also give an option for one day and two-day shipping on your website. Arranging for one day and today deliveries can be a hassle as courier companies charge very high prices for expedited delivery or do not have the pin code network. With Shiprocket Fulfillment, you can save on these additional costs and focus on other aspects of your business. 

Sync Channels

When you sell on your website and also on different marketplaces, it can be challenging to manage incoming orders on one platform. However, Shiprocket Fulfillment lets you sync all your channels with an advanced dashboard so that you can take charge of all incoming orders in one place and process them seamlessly at Shiprocket Fulfillment centers. 

Conclusion

To simplify fulfillment operations, it is an intelligent choice to outsource your fulfillment operations to a 3PL fulfillment provider like Shiprocket Fulfillment as you can save on costs by a considerable margin. It may seem like a huge and continuous investment on the outside, but once you dig deeper, it is actually a cost-saving model.

Shiprocket Fulfillment features
March 16, 2021 by Srishti Arora

6 min read

Here’s Everything You Need to Know About Fourth-Party Logistics

March 2, 2021 by Rashi Sood - 6 min read

Fourth-party logistics, also known as 4PL, is a model where the business owner outsources all of its supply chain and logistics to an external service provider. This provider is responsible for the supply chain process and assessing, designing, and building the solutions. The external provider can either have his own warehouse or tie-up with warehouse companies. It is just that the business owner doesn’t have to look after the supply chain process and an external provider takes care of everything on his behalf.

fourth-party logistics

What Is Fourth-Party Logistics?

A fourth-party logistics partner is like a third-party logistics partner, but it is authorized to subcontract a few of its responsibilities. Essentially, 3PL provides all the contracted services through its resources only. However, when it outsources its part of the process to a separate provider, it becomes a 4PL.

For instance, a company ABC outsources its shipping and remote storage of products to a supplier XYZ. The supplier XYZ then outsources the warehousing operations to a warehousing company. Thus, the supplier XYZ becomes a 4PL party.

Notably, outsourcing logistics services is a business decision. A company that doesn’t have the ability or resources to conduct the logistics operations contracts out the process to a supplier. The supplier then stores or moves the products as well as takes and fulfills the order.

Difference Between 1, 2, 3, 4, and 5 PL

fourth-party logistics

1PL – 1st Party Logistics

A 1PL or 1st party logistics is a firm that transports orders from the origin to the destination. Essentially, it functions like a courier service that moves goods from a manufacturer to the distributor or retailer.

2PL – 2nd Party Logistics

A 2PL offers transportation of goods from a specific segment, like rail, road, air, or sea. They typically function as carriers and are mainly used for international transport of products, especially heavy and wholesale.

3 PL – 3rd Party Logistics

A 3PL or third-party provider is related to the transportation and delivery of the product. But it provides a bundle of logistics services as well, like transportation, warehousing, supply chain management, freight forwarding, packaging, and much more. They can also offer IT software products for tracking and tracing product delivery status.

Apart from offering all the services mentioned above, they also help manage all the supply chain and order fulfillment process obstacles. They take care of domestic, international, and offshore shipping and warehousing.

4 PL – 4th Party Logistics

A 4PL acts as a single point of contact for the company and manages all of its supply chain and logistics operations. They are also called Lead Logistics Providers. They cover all the services offered by a 3PL. They work as a consulting company and take care of every supply chain aspect. Unlike a 3PL, a 4PL can also outsource a few of its responsibilities to an external provider. 4PL is becoming the next big thing in the supply chain and logistics sector.

5PL – 5th Party Logistics

A 5PL is a logistics aggregator that aggregates the demands for 3PL for better and cheaper rates with different shipping and warehousing companies.

Advantages of 4PL

fourth-party logistics

Many companies find themselves in a dilemma when they decide to outsource their supply chain and warehousing operations to a 4PL provider. As logistics itself is complex, there is a demand for qualified, experienced, and independent individuals or companies handling logistics operations. These external providers offer innovative and end-to-end services to meet their client’s requirements.

The new supply chain is a high-tech world with several operational software, sophisticated strategies, and customer-centric operations. So, to help these businesses, many 3PL and 4PL providers are coming up. These providers are providing not just ordinary shipping solutions but tracking and tracing solutions as well.

Let’s take a look at the benefits of outsourcing supply chain and logistics operations to a 4PL:

Trusted Solutions

4PL providers take logistics services to the next level by offering the best services to the clients. They are committed to their clients and keep their clients’ interests at the forefront. They take the relationship between them and their clients as a valuable partnership. This points towards nothing but the quality of services 4PL providers offer.

Data collection and analyzing it to get meaningful and useful information is crucial for optimizing a company’s supply chain process. A 4PL provider collects valuable data and uses it to come up with better strategies for its clients.

Not just this, a 4PL provider also provides the security of an in-house logistics department with the benefits of outsourcing the supply chain process.

Customer Connectivity

How a seller and buyer connect is ever evolving, and so is the supply chain process. Online buying options are also creating new consumer habits. Customers nowadays are spending less time with the sellers, and they are heavily dependent on online interfaces to interact with the sellers.

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While online communication may harm the buyer-seller dynamic, 4PL providers help improve the relationship by keeping the customers informed about their purchases. When a 4PL provider takes on a business’s requirements, it takes care of its customers’ needs. For this reason, customer engagement is a 4PL provider’s top priority.

4PL providers keep the customers informed about their purchase – from the moment they buy the product to the time it is delivered to them. Notably, greater customer service leads to enhanced brand loyalty from customers.

Improved Efficiency

4PL providers offer operational improvements that help streamline work and eliminate all types of inefficiency. This helps companies reduce their spends. The companies also get their resources free and available for other work.

The companies can redistribute their resources from work related to logistics and focus more on the core company related work. While the company focuses on core work, 4 PL providers help them by handling the distribution of their work and keeping their customers happy. When a 4PL provider properly handles logistics, productivity tends to increase.

Expansion

Every company’s goal is growth, and 4PL providers can help make this vision a reality. A 4PL provider has access to the supply chain industry, and they can assist their clients in growth and expansion. They have good connections with national and international partners. They build reliable networks to support the development of a company.

Corporate Clarity

4PL providers are a single point of contact between their clients and their supply chain process. They oversee and manage all the complexities a company might face in its logistical operations.

A singular point of contact to coordinate all the steps throughout the supply chain process – from material sourcing to last-mile delivery solutions, helps a company manage its operations efficiently.

4PL providers help make all the improvements and ensure maximum operations efficiency can be achieved.

Shiprocket Fulfillment features
March 2, 2021 by Rashi Sood

5 min read

5 eCommerce Fulfillment Areas You Must Review Every Year

February 25, 2021 by Srishti Arora - 5 min read

eCommerce in India is growing exponentially. Every day, several D2C brands make their way online and sell their products to a wide audience worldwide. According to a report by IBEF, the Indian eCommerce market will reach US $99 billion by 2024, growing at a 27% CAGR over 2019–24. This indicates the significant scope this market holds in India. With the increasing mobile penetration, the internet is becoming more accessible to tier two and tier three Indian cities. So, the demand for products is only going to increase in the coming years. 

If you are competing with several online sellers, you must sort your eCommerce fulfillment game. You can be a brilliant website online, but shipping and delivery are not up to the mark; the customer experience will never be positive. With changing trends each year, you must continuously review your fulfillment operations to ensure that you are up to the mark and meeting customer expectations at all times. 

Ofcourse, it can be tedious to continually audit and change all aspects of your fulfillment supply chain. However, it is essential to review some elements frequently to avoid unfortunate situations like stockouts and delayed deliveries. 

Here are 5 fulfillment areas you must look out for and improve upon regularly. But before that, let us quickly overview the fulfillment process and its components. 

An Overview of the eCommerce Fulfillment Operations

eCommerce fulfillment operations consist of all processes starting from order management, inventory management, and storage, followed by picking, packaging, and preparing the order and going right up till shipping and returns. 

These operations require strict intervention now and then to make sure that they run smoothly. Any glitches in any of the functions can lead to delays in delivery and a negative customer experience. Therefore, regular audits are recommended to ensure that there is perfect synchronization and efficiency is not affected.

However, it can get challenging to monitor all operations simultaneously continuously. Therefore, there are some aspects of your business that you must review every year to maintain perfect harmony in your operations. Here are five of them that we think are essential. Let’s have a look. 

Fulfillment Areas You Must Review Every Year

Growth and Expansion

An integral part of any commerce strategy is growth and expansion. It is what you strive for nearly. Start defining your goals and set specific goals for each year. Suppose you think your warehouse has reached its capacity or you are looking to diversify your offerings. In that case, you must chalk out a plan for growth and expansion and reach out to necessary stakeholders accordingly. For example, if you are looking to start delivering products in new states across the country, you must analyze the inventory, time required, and shipping. If you do not plan this, there are chances that you might mess up when you try to launch something and face backlash for the same. Meticulous planning is vital for successful growth and expansion. 

Storage Space

The next big hassle that you can avoid is limited storage space. Whenever you start a business, you do not have unlimited storage space for your inventory. Usually, sellers start with self-storage and then move to store products in established warehouses. Audit the warehouse storage space every year to figure out if you need more space or if you need to outsource to a 3PL fulfillment provider. Analyzing this year in advance based on predictive analysis and demand forecasting can help you save on a lot of money and additional expenses. 

Resource Assessment

Taking care of the labor at your warehouse and fulfillment center is equally essential. They are the workforce carrying out the tasks at the ground level. Keeping a tab on their skills and assessing their performances regularly can help you improve your overall shipping and delivery by a considerable margin. Assess your resources periodically and check if any changes need to be made in your organization to ensure a seamless synchronization and hassle-free supply chain.

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Inventory Management Process

If you have a manual inventory management process, you need to continuously check your physical inventory and tally it with your records. This will help you figure out any discrepancies, and you will be able to eliminate any issues that might arise later. Try moving towards automated inventory management so you can keep track of the incoming orders and sync your inventory with them accordingly. This will help you forecast your customer’s demands in a much more systematic fashion, and you will be able to deliver orders much faster. 

Process Automation

Whatever automation you bring into your system requires thorough auditing to ensure that your data is not getting lost in the process. To ensure seamless communication between the supply chain operations, you must audit your process automation regularly. This will help you stay up-to-date with the work, and you will be able also to incorporate any innovations and technology conveniently. Similarly, if you want to move to more automated methods on the floor, you must include them at the beginning of the year so that your workforce can get used to any changes early on. 

Final Thoughts

Auditing and assessing your eCommerce fulfillment supply chain is a must for any business. Since your fulfillment supply chain forms your eCommerce online business’s backbone, try to match the industry standards and incorporate new trends wherever possible. This will help you get an edge in competition, and you will be able to establish yourself as an industry leader much faster. 

Shiprocket Fulfillment features
February 25, 2021 by Srishti Arora

7 min read

How Evolving Automation Trends Will Impact the Fulfillment Space in the Coming Years

February 9, 2021 by Srishti Arora - 7 min read

As you are aware, eCommerce fulfillment is one of the most important aspects of any eCommerce business. Over the years, this process has become much more advanced and intricate. With the advent of eCommerce, fulfillment has gained even more critical as it directly affects the overall customer experience.

The need for perfect synchronization and reduced errors is increasing by the day, and brands cannot afford to miss out on any orders. Over the years, automation has made its way into the fulfillment industry, and sellers and  3PL fulfillment providers have started automating their operations for 100% accuracy and timely delivery. With this article, let’s discuss some of the automation trends set to drive the fulfillment industry.

Role of Automation in eCommerce Fulfillment

Before diving into the automation trends, it is essential to understand the importance of automation in the fulfillment industry. Over the past few years, automation has seen a massive boom in the warehousing and logistics industry. Combining the advantages of these sectors, the entire fulfillment network has seen a boost because of automation. 

On the warehouse floor, automation has helped reduce processing time, fulfillment costs and improve the supply chain by many folds. Inside a fulfillment center, automation has allowed maintaining real-time data flow between operations and inventory information, making the process much more efficient. Using automation for too strenuous functions like picking, packaging, and warehouse management has improved warehouse productivity by a considerable margin. 

At every step of the order fulfillment process, automation has improved operations to maximize productivity and enhance workflows across multiple fulfillment centers. With smart data centers and concepts like predictive analytics coming into the picture, the automation trends are only bound to grow in the coming years.

According to a report by Businesswire, In 2019, the warehouse automation market in India was valued at INR 202 billion. It is expected that the market will expand at a compound annual growth rate (CAGR) of ~13.38% during the 2020-2024 period, to reach a value of INR 421.5 billion by 2024.

Even though end-to-end automation might not be possible in India immediately, applying a few upcoming trends gives rise to the requirement of the automation reforms that are much needed. 

With an upward trend set for the automation industry, let’s look at some of the automation trends prevalent in the fulfillment industry. 

Automation Trends in the Fulfillment Space

Application of Blockchain

Blockchain is transforming many sectors in India. It has already made a significant mark in the banking and healthcare section, and now it is slowly making its way to the fulfillment space.

Blockchain helps the supply chain become more transparent and further improves communication methods, data analysis, and positive results. Blockchain allows warehouses and supply chain networks with transparent and controlled transactions, pre-approved transaction fees, reliability, and the ability to be audited easily. Overall, it is helping the procurement, digital payments, logistics, and manufacturing. All of these are critical sections of the supply chain that require constant vigilance and intervention.

Furthermore, blockchain helps cut additional labor costs and improve inventory management by  maintaining thorough records of inventory, orders, and returns. Blockchain technology can help optimize operations by making data available to every stakeholder in the process. It can help improve operational efficiency and yield time. 

Artificial Intelligence to the Rescue

Artificial intelligence is slowly becoming a common concept among fulfillment centers. Now, sellers and 3PL providers are taking into account the benefits of artificial intelligence and how it can help reduce manual labor dependability. WAI the application, communication can be improved by a large margin and help reduce human errors. 

Along with this, AI can improve warehouse management by incorporating intelligent logistics. Usually, warehouse logistics depended upon the SKU management and operator skill level. With the advent of artificial intelligence and machine learning algorithms, retail stock movement and control have led to easier material handling and a substantial reduction in errors. Not just this, with machine learning, backed data, picking operators can devise the best routes for transportation within the warehouse and improve efficiency. 

Another advantage of artificial intelligence is robots. Even though this is a far-fetched initiative for India, marketplaces like Amazon have already started applying it in their fulfillment centers. They can be utilized for more efficient picking and slotting based on intelligent writing within the warehouse. 

Reduced Information Lags

A key takeaway from 2020 has been the importance of the availability of information. You need to know about your supply and demand to ensure that you can keep up at all times. For example, if there is a supply risk in your supply chain network, you need to be aware of it and take action without wasting time. 

Also, if there is a surge in demand, you need to know about it to amp up your manufacturing or inform your suppliers well in time. Improvement in communication with automated networks and real-time exchange of information will help eCommerce companies devise much more effective strategies for their business. 

IoT for Data Tracking

The Internet of things is another concept that is picking up pace in India. It is slowly making its way into the healthcare and food industry and the logistics and warehouse management department. Warehouse management systems (WMS) are integrated systems that help managers keep track of the inventory and the warehouse. 

The internet can help improve the entire warehouse management with tracking devices, limited documentation, and enhanced reporting features. This can help reduce operations time, faster order to ship time, supply chain visibility, and reduced damage to goods.

IoT incorporated with blockchain can help you reduce data records and improve accountability within the supply chain network. 

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Centralized Inventory Management

A centralized inventory management system can help maintain inventory across warehouses. If you have multiple warehouses across the country, a centralized inventory management system can help you with omnichannel retail, faster efficiency, and effective inventory control. 

Automation helps improve inventory control by sharing real-time data, reducing the order to ship time, and enhancing inventory processing. This is also helping with a more efficient demand forecasting based on several data points and past trends. 

Outsourcing to 3PL Providers – The Next Big Thing

Even though D2C brands and e-commerce sellers are trying to incorporate as many key automation trends as possible, it is difficult to do so in a short period to yield the best possible results. Even though e-commerce sellers dominate a significant part of the warehousing and logistics market, the biggest chunk still lies with 3PL fulfillment providers. 

3PL fulfillment providers essentially take care of all fulfillment operations for your business. These include inventory management, order management, warehousing, logistics, and return handling. One such fulfillment provider that can help you with end-to-end fulfillment is Shiprocket Fulfilment.

With Shiprocket Fulfilment, you can store your inventory in fulfillment centers located across India’s significant zones. We have fulfillment centers located in Delhi, Gurugram, Mumbai, Kolkata, and Bengaluru. By outsourcing your fulfillment operations to us, you can deliver 3X faster, reduce shipping costs by up to 20%, and maintain a 99% of order accuracy for your orders. 

Learn more about Shiprocket Fulfillment here

Conclusion

Automation is going to be a significant driving force shortly. It is intelligent to adopt it well in time to grow your business with the evolving trends. Be it incorporating blockchain or IoT into your current supply chain operations or outsourcing operations to a 3PL fulfillment provider. It is essential to take a call early on.

Shiprocket Fulfillment features
February 9, 2021 by Srishti Arora

5 min read

5 Tips for SMEs to Enhance Warehouse and Logistics Management in India

February 2, 2021 by Srishti Arora - 5 min read

The Indian eCommerce industry is growing at an exponential rate. Every day several D2C brands have set up their shop online with their website or social media channels. It has become super easy to start selling online but is it as easy to ship and store products?

The registers and warehouse industry in India is still picking up pace, and brands are now starting to understand the importance of the right warehouse and logistics management systems. Many businesses are taking necessary steps to ensure their orders’ seamless fulfillment; many still struggle to enhance their existing supply chain systems.

Here is a brief insight into how SMEs can enhance their warehouse and logistics management in India.

Scope of Warehouse and Logistics Management in India

The warehousing and logistics industry in India is growing faster than ever. It is expected that the warehousing market will grow to $19.5 billion by 2025.

The warehousing market is currently dominated by the retail, FMCG, and logistic sectors. The government has also launched several policies like logistics parks and free trade warehousing zones that prompt India’s warehouse market growth.

Also, the supply chain of many businesses has improved as the introduction of GST has reduced the inventory and turnaround time, which has further decreased the number of checkpoints.

According to a report by Ernst and Young and the CII Institute of logistics, the Indian warehousing industry’s size is estimated to be around INR 560 billion. 

The logistics and warehousing sector has vast scope in India, and it is said that logistics can be the next goldmine of India.

If you are an eCommerce D2C brand, you must also enhance your warehouse and logistics supply chain for maximum results. Here is how you can do so. 

How Can SMEs Enhance Warehousing, Logistics, and Fulfillment Operations

Automation in Fulfillment Operations

Automation is the future of fulfillment operations. Efficient fulfillment can result in a 4x increase in customer experience. With evolving trends like artificial intelligence, augmented reality, and the internet of things, you can optimize your warehousing and logistics operations by streamlining floor management and increasing your warehouse’s productivity. Automation in inventory management areas can help you forecast your sales and inventory faster by recording data in real-time. This information can be vital for making decisions regarding your supply chain. What earlier took days or weeks can now be done in a few hours.

3PL Fulfillment Providers

3PL fulfillment providers are the next big thing for warehousing and logistics management. These providers take care of all the fulfillment operations like inventory management, order management, packaging, and distribution. All you need to do is send your inventory to their warehouses. 

SR Fullfilment

Shiprocket Fulfillment is one such 3PL fulfillment provider that can help you simplify and streamline your order fulfillment process. We have fulfillment centers located in key zones of India. You just need to send in your inventory, and we will take care of all the processes thereon. By storing inventory closer to your end consumers, you can reduce shipping costs, deliver 3X faster, and increase your customer satisfaction by a large margin. 

Warehouse Management Systems

Warehouse management systems can help reduce the order processing time by a large margin. Since the warehouse management system keeps track of where each product is stored, the picking to shipping times gets reduced by a considerable amount. For example, if processing an order took two hours earlier because locating the products Took a substantial time in the warehouse, a warehouse management system can help you reduce this processing time by at least 50%. Along with that, a warehouse management system also keeps track of your inventory and can tell you about your requirements in advance. A warehouse management system is also an extension of the automation you must include in your warehouse and logistics management.

Multi-Carrier Shipping 

Multi-Carrier shipping is also helping eCommerce brands gain more excellent serviceability in the country. Shipping with multiple courier partners can help you reach pin codes that might not be serviceable by just one courier company. Since all courier companies do not have the same efficiency in all shipping zones, shipping with multiple carriers can be a significant boon for you. Shipping aggregators and solutions like Shiprocket can be beneficial if you want to improve your logistics management with numerous courier partners at discounted rates.

3PL fulfillment providers like ship rocket fulfillment have a fleet of multiple carriers that help distribute your products in the fastest manner possible. 

Seamless Supply Chain

Eventually, it is your fulfillment supply chain that binds all the processes together. Therefore crystal clear communication is essential for smoothly running the supply chain operations. India’s major drawback is the lack of clear communication and synchronization between different supply chain areas, which leads to a setback in fulfillment operations. Establishing proper data channels between all segments can immensely help with the proper flow of information and exceptionally optimize supply chain operations. 

Final Thoughts

Warehousing and logistics management in India still has a long way to go. With the increasing advent of technology, D2C brands can benefit and improve their fulfillment supply chain operations. As the logistics sector is also dominating India’s warehouse space, outsourcing to 3PL full payment providers can be a wise option for any day to see business. There are more benefits than losses, and there is no harm in giving it a shot. 

Shiprocket Fulfillment features
February 2, 2021 by Srishti Arora

5 min read

What is the Importance of 2 Day Shipping in eCommerce?

January 28, 2021 by Nishtha Chawla - 5 min read

eCommerce is witnessing its high days at the moment, and yet, the cart abandonment rate in the country is also high. Around 70% of customers tend to leave their shopping carts on online platforms. And a reason for this may be a complicated checkout process, but at the same time, one of the chief reasons behind this variety of abandonment is the lack of fast delivery for the customers. Awaiting one’s online package post placing the order is one of the most impatient times for a customer. Furthermore, receiving that package in a couple of days is a thing of joy for the customer. This is precisely why the Amazon 2 day shipping took off in the first place – because the brand enabled a customer experience that was based on unadulterated pampering at the click of a button. On that note, let us enlist a few reasons why speedy delivery is the popular trend of the modern world. 

Importance of 2 Day Shipping for an eCommerce Business

Fulfilling the Expectations of the Customers

The eCommerce giant Amazon raised the operating bar for all its competitors the moment it enabled the function of 1-day delivery for its customers. Hence, the move was visionary for its time, compelling the rest of the e-retailers to amp up their online selling game by providing fast shipping services to their customers. If you look at the scenario today, you will find that the customers are already buying products with a pre-installed expectation that their placed order will be delivered at their doorstep in the least amount of time. What’s more is that they prefer to shop with brands that simplify their shopping experiences by offering same-day, next-day, and two-day shipping services.

Hence, it has become essential for e-stores that their audience avails such top-notch service for greater customer satisfaction. 

Instilling Trust Among Your Customers

Yes, the COVID-19 pandemic has brought a significant shift in how customers are shopping, including their payment behaviour. Debit cards, UPI, Credit cards, etc., are being used increasingly in the world of online shopping. However, Cash on Delivery is still ruling the market. To build this cycle of trust amid your customers, it is essential to offer them the fastest courier services. This way, when they haven’t opted for Cash on Delivery, quick order arrival will fill them with a sentiment of trust in the brand they’ve purchased from. 

Fulfill More Orders in Less Time

The lesser time you take to fulfill an order placed by a customer, the more orders you can accept to generate increased revenue and maximize your profits. One of the most notable benefits of offering two-day shipping to your customers is that you get to churn out more work and bank in more revenue earned with the help of seamless administrative functioning. This way, you get to satisfy both the parties – yourself and your consumers. 

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Extinguish the Problem of Order Backlogs

Offering two-day delivery to your customers will solve one of the biggest problems faced by countless merchants – a backlog of orders. If your business delivers products within 7-10 days, there is a chance that you may not be able to accept more orders than you may want to for increased revenue. You’ll mostly be busy trying to fulfill the orders that are out for shipping or in the process of being shipped to a particular address. Such a variety of delays may be also hurt the supply chain operations and the inventory management for your e-store. Therefore, it is better to keep your business running without order backlogs with a 2-day shipping service. 

How Can You Avail this Feature Optimally for your Business?

Partner with a Third-Party Fulfillment Facility

A 3PL fulfillment solution will offer your the best warehousing and delivery services most cost-effectively. From automated inventory storage to comfortable accommodation in case of last-minute order spikes, your order fulfillment operations will streamline with the help of a third-party warehousing brand. For instance, let’s take a look at how Shiprocket Fulfillment provides its customers with two-day shipping at a nominal price, no minimum lock-in period, and allows you to mitigate other order fulfillment issues like return orders, weight discrepancies, etc. What’s more, is that partnering with a brand like Shiprocket Fulfillment to provide quick shipping also gives you the benefit of free storage for the first 30 days. 

To keep this operational trust cycle, you must join hands with a 3PL brand that offers competitive features for your business’ growth. 

Offer Free 2 Day Shipping with a Minimum Order Value 

Do the calculations, optimize the cost enough to provide free shipping on a minimum purchase value, and promote this offer across all your social channels! If your customers identify with your brand and its top-notch services, in addition to the 2-day shipping that you’ll be providing them anyway, you will be flooding with orders on your website, with your customers on pins and needles.

Final Thoughts

Within the eCommerce universe, the competition to excel is unbelievably high. Retailers are coming up with new and updated features and services to ensure that their customers are hooked to their products. As an online seller, it’s time that you started trusting the right partners for delegation of operations, an example of which is joining hands with a third-party fulfillment provider for 2-day shipping at the lowest cost. So, if you’re looking to grow your eCommerce business with seamless operations and a smooth customer experience, you’re looking at the right screen and reading the right blog. 

Shiprocket Fulfillment features
January 28, 2021 by Nishtha Chawla