Whether it’s a place in the sun, your own home, or your ecommerce order fulfillment strategy, location is everything.
It doesn’t matter if you’re a new business, a small business, a medium-sized business, or you’re leading the game, the location(s) of your fulfilment centre(s) can have a massive impact on the growth of your business.
So, let’s take a look at the different aspects you need to consider to ensure that your customers are satisfied each and every time.
Why does your fulfillment location matter?
Before we help you choose the ideal location for you, here’s why it matters probably more than you think:
- Determines your shipping costs
Obviously, the goal is to deliver your orders to your customers as quickly as possible. The rise of the next day delivery has put huge amounts of pressure on online stores to up their game in terms of how quickly they can get their goods to the consumer once they’ve clicked the checkout button.
In addition to this non-negotiable, having a strategic location is also incredibly important for keeping shipping rates lower, as if possible, you want to avoid expensive - and cross-country deliveries.
So, the location is critical in the overall shipping strategy as it makes sure orders (especially larger volumes) are within a suitable radius of the fulfilment place.
- It’s important for future expansion
Naturally, you want your business to grow, and should it take off quicker than you expected, you need to adapt and scale up your order fulfilment process. This means adding further storage spaces to your business network so that you can meet the growing demand.
This is where location is especially important, as you need to continue providing the same level of speed and service that your customers have come to expect.
Furthermore, future international expansion should be considered, too, as this is of major importance in ecommerce.
For example, if your warehouse is based in the UK, you’ll also need an alternative warehouse - preferably in Europe. Or say you’re based in the Netherlands and you want to ship to Southern Europe. In this instance, you should consider opening another warehouse in that area so you can also compete like a local.
Four factors to help you choose:
Depending on your own business and individual circumstances, here are four determinants you’ll need to consider:
- Where are your customers based?
Where your customers are based is one of the most crucial points in terms of choosing your fulfilment locations. Which is why it’s so important to gauge a rough idea of where the majority of your customers order from to ensure a smooth fulfilment process from beginning to end.
How expensive or fast your orders are to ship is all down to how far they need to travel to reach their end destination. Which means the more shipping zones the orders need to pass through naturally bumps up your costs.
- Will you be offering free shipping?
Whether or not you offer free shipping is all down to fulfilment location. This is because, when you provide your customers with the freebie option, you’re putting the majority of the shipping costs on your shoulders. In this case, it means a conveniently placed location is integral to keep costs down to ensure you can carry on providing the lucrative offer.
For example, say your location is London. You could offer free next-day delivery to all customers within the transport radius. Not only does this guarantee a speedy delivery service to a large group of people, but it also lessens costs on your end.
- Delivery time is critical
We already mentioned how quick delivery is becoming more and more important for online stores. In fact, the majority of consumers have a very limited waiting period for orders on practical and household items, and expect their packages to be on their doorsteps within 24 hours thanks to ecommerce giants like Amazon, Cdiscount and Zalando. If you sell on these marketplaces or you are competing with them, then it’s all the more important.
Unless what you’re selling is very niche or bespoke, you can get away with longer waiting times. Just make sure that when you set your delivery promises, you follow them through.
- What is best for you?
In the grand scheme of things, your fulfillment location centre is essential to the smooth workings of your ecommerce store.
So, making sure that your centres are cost-effective, take into consideration delivery time, and aren’t in the middle of nowhere is vital.