What Is E-Commerce Fulfillment?


E-commerce order fulfillment is generally performed by various order fulfillment services. These services receive wholesale supplies from the people who produce or distribute them (for example, a toothbrush from a toothbrush-manufacturing company) and complete the necessary steps in order to get that toothbrush to whoever ordered it. Order fulfillment can apply to business-to-business- orders, in which a business orders a product, or direct-to-consumer orders, in which an individual orders something in particular (like a toothbrush).

For instance, Amazon will fulfill the actual orders through its FBA program on behalf of wholesalers that list their products on its site.

The process begins when an order fulfillment company receives a product that has already been made. For example, a company like Behr that sells paint probably doesn’t do the chemistry involved in mixing paint. Instead, they contract their paint from an outside source and then receive it at a warehouse. A worker would then review what has arrived; if they have ordered 6 green paint cans, they would want to make sure that there are indeed 6 green paint cans there. A worker would check to see if the inventory is in good condition (no leaky paint cans or peeling labels). If they’re a modern business, they’d then add barcode labels to the product. That way, they can know where each green paint can is, where it’s sold, and how many are sold.

Orders don’t go immediately out to customers, or businesses. After a warehouse applies barcodes to their items, they shelve them. Different parts of a warehouse are usually for different types of product. Products that are high in demand are placed in a different area than those which are only occasionally ordered. In-demand items are closer to the stations where orders will be packed, since the owners of the warehouse now that they will be packed more frequently.

Next, the warehouse workers will process the orders, reading what a customer has asked for and moving those items to a packing station. People at the packing station check again to make sure that nothing is damaged and figure out what packing materials should be used to make sure that no damage occurs. A delicate object would likely be wrapped more thoroughly than a durable one. The workers at the packing station scan the barcode, which tells their computers that it is now time for the item to leave the warehouse. Some warehouses even outsource their packing and shipping, since it’s such a time-intensive process.

Finally, a shipping station evaluates the shape and size of the product and figures out where it’s going. If an order is going overseas or has an unusual shape, the shipping will probably be more difficult and take more time. The U.S. postal service would probably not, for instance, be able to ship a viola to Uganda. Many modern companies like Amazon let their customers know exactly when they ship the order, giving those customers peace of mind that their orders will arrive on time.

Occasionally, mistakes are made during this process. When that happens, barcodes come in handy. An efficient and thorough inventory system lets warehouses know when products return to warehouses. The products might then we re-sorted into inventory for future sale, or disposed of due to irreparable damage.

To offer you a concrete example, imagine that you have a pallet of brand name dresses by various designers such as Calvin Klein, Ralph Lauren, R&M Richards, and Nine West. You would list your products online, send the actual pallet to the fulfillment center, pass on the orders that you receive to the center, and then the center would in turn send out the dresses as per the orders that you receive.

Although online sellers can do the same process in house, an eBay or Amazon seller might prefer the convenience, especially if he or she is running another business or employed full time. It can also be easier for an online wholesaler or retailer to scale their business if they have a third party actually taking care of the orders.

This set up can be ideal for entrepreneurs that are running various Shopify stores.

Below is a list of some of the companies that offer fulfillment services for online retailers.