By UrbanFox on Mar 4, 2020 4:46:52 PM
What is a Fulfilment Centre?
Let’s cut to the chase. Some of us may not know exactly what Fulfilment Centres are.
In simple terms, Fulfilment Centres, more commonly known as distribution centres, are specialised buildings designed to store goods temporarily for retailers and wholesalers before shipping out to another location or directly to customers.
Isn’t this a typical Warehouse then? While the terms may be used interchangeably,
there are many important distinctions between the two.
Warehouses vs Fulfilment Centres
Warehouses prioritise delivering cost-effective solutions for storing goods in huge volumes for the long-term. This is more suitable for managing a larger volume of goods, typically by bigger stakeholders such as manufacturers, importers, exporters, wholesalers and transport businesses.
Warehouses often utilise power pallet trucks, pallet pickers, order pickers and technology to track, store and ship large amounts of goods to hundreds of stores. Further assortment and sorting of goods will then be performed in the retail stores. Hence, warehouses typically do not offer specific labelling or packaging for its goods.
Meanwhile, Fulfilment Centres are usually third-party logistics (3PL) providers specialising in delivering personalised and small packages. They value business relationships and emphasis on delivering goods to end-consumers rather than storing them over an extended period.
Once a shopper completes an online purchase, Fulfilment Centres will begin picking out the inventory, packing them into boxes and provide shipment labelling.
Why Should you Consider Fulfilment Centres?
Finally, let’s talk about why you should consider 3PL providers like Fulfilment Centres.
With global retail eCommerce sales projected to skyrocket to US$ 6.7 trillion in 2023, Fulfilment Centres are becoming the popular choice to meet eCommerce solutions. And here’s why:
Today, Digital Commerce 360 says that customer experience will propel the next generation of e-commerce. And the two primary touchpoints that will drive customer experience, quoted by Hubspot, are
"People & Product"
This is where Fulfilment Centres excel in; they have proven track records of using advanced technologies to help eCommerce businesses streamline their shipping, picking and packing operations for quick and reliable deliveries to end-consumers. Not just that, they can even cover after-sales support such as customer service, product returns and recalls.
Above all else, Fulfilment Centres emphasise heavily on transparency of its logistics processes to businesses and online customers. Drawing an example, Fulfilment Centres provide businesses with real-time visibility over their inventories and customers’ delivery statuses through geo-positioning, timestamp and electronic proof-of-delivery. This gives businesses the peace of mind to focus on their core areas (e.g. sales, research and expansion of product lines) while keeping customers informed about their order statuses.
In conjunction with Korn Ferry’s 2019 3PL study, 89% of 3PL users are in agreement that outsourcing to Fulfilment Centres have helped to improve their service levels to customers; and as brands or business owners, customer experience should evidently be positioned at the core of your eCommerce strategy. If your order processing or delivery time is slower than your competitors, you may be losing out customers to your competitors faster than you think.
Fulfilment Centres can then come into the fray to streamline the entire customer experience journey.
Ultimately, it boils down to the type and the scale of logistics solutions your business may need. Try approaching your local Fulfilment Centres to get a quote for your logistics requirements and select one that best fit your business needs today.
As an omnichannel enabler, we empower homegrown and global brands to strengthen their presence in this region – through multi-channel marketplace management, real-time inventory management, integrated fulfilment for B2B2C, and through hybrid last-mile delivery – providing end-to-end seamless logistics solutions.