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Order Processing is the function of accepting customer
orders, processing and shipping the order.
In order to perform this function you have to be properly
staffed, have the facilities to store the products, space to
store shipping supplies, a place to package the items, print
the shipping label, and schedule a pickup or deliver the
items to the shipping vendor (USPS, UPS, FEDEX, etc.).
It also involves tracking the shipment to ensure that the
customers receives it and handles any returns.
This takes time and resources that many small businesses
don't have. Hence, it makes sense to outsource this
function.
The good news is that many organizations are ready to do
this for you at a low cost. These organizations are
called Fulfillment Centers.
These are the advantages of using Fulfillment
Centers:
- Cheaper Shipping Fees: Fulfillment Centers can
negotiate for bulk rate shipping and lower the shipping cost
to you.
- Experience: They have the advantage of
experience which you do not have.
- Staffing: They are better staffed than your
small business is to get this task done.
- Scaling: Fulfillment Centers gives you the advantage
of handling increased sales or high volume sales that are
seasonal.
These are the disadvantages of using Fulfillment
Centers:
- Fees: There is a base price. There is a fee
based on the number of sales and the number of items in each
shipment (per month). There is also a storage and
shipping fee.
- Product Type: Some Fulfillment Centers will not
provide your their service if your products consist of
perishables or fragile items.
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