More Order Fulfillment Could Be Outsourced: Report

Nov 10, 2011 9:57 PM  By

E-commerce and multichannel retailing are placing greater demands on order fulfillment practitioners, according to a new study released by third-party logistics provider Saddle Creek Corp.

The E-Fulfillment Trends Report focused on how companies address the challenge of providing efficient, cost-effective, service-driven fulfillment operations. The report, conducted during the last two weeks of September, is based on online survey responses from 160 retailers, distributors and manufacturers involved in e-fulfillment.

Some highlights of the report include:

The rise of e-commerce has elevated order fulfillment operations to a critical business function. The practice now requires sophisticated processes, state-of-the-art resources, and an in-depth understanding of multiple sales channels.

There is a distinct trend toward multichannel retailing as the majority of respondents (57%) use more than one sales channel.

The demand to deliver perfect orders and a consistent brand experience from channel to channel can be challenging for many companies. Processing time for outbound orders (35%), system integration (29.4%), and upholding service standards (29.4%) are foremost on the minds of particularly weighty responsibilities, according to respondents.

To accommodate the increasing sophistication of fulfillment practices, nearly 40% of respondents outsource some or all of their e-fulfillment operations.

“Certainly companies are finding value in outsourcing,” says Tom Collins, director of marketing for Saddlecreek Corp. “The data shows that, of those respondents who outsource at least a portion of their fulfillment, the ability to focus on their own core competency is listed as one of the biggest advantages to outsourcing. In fact it’s third on the list after cost savings and the ability to avoid investment in infrastructure.”