Efficient and reliable customer fulfillment is essential to any e-commerce business, keeping your customers happy is paramount to any repeat business and regardless of how good your product is, you will always have returns.
Long delivery times or missing deliveries not only upset your customers but will affect your business reputation and therefore profitability longer term.
In the days of Amazon Prime membership, customers are used to rapid 1-2-day delivery speeds. So, the last thing you want is a customer waiting 5 days or more to receive their purchase. Because you can bet your house on the fact that they’ll remember the delay when they think about buying the same item again and find someone else.
The challenge for me and anyone that sells into the US and isn’t US-based is either sending supplements via International delivery and for me, this would mean from Malaysia or stocking in the USA.
If you have been following along here you most likely know I am using a US-based supplement manufacturer. The question is, therefore, how can you address fulfilling orders in a country you’re not based in?
Thankfully the US has many fulfillment centers that can manage my inventory as well as handle the packing and posting every day. They will even manage those pesky returns that I talked about earlier.
I am going to look at the challenges of selecting a fulfillment company based in the US for my completely new supplement brand. Look at what’s involved in setting up and what to look out for when selecting a fulfillment company that best fits your needs.
In-house vs Fulfilment Center
If you want full control over your fulfillment and to be able to add inserts or do anything bespoke, then in-house fulfillment is often the best solution.
However, in-house involves holding your own stock, employing staff if you don’t do it yourself, and often this just isn’t feasible if you’re fulfilling anywhere other than the country of origin. Additionally in some businesses, you could have bulky items you may need extra security or even climate-controlled conditions.
For me the fun part of being a business owner is not a daily trip to a post office, I would much prefer to use a fulfillment center, not only do they have the ability to scale from a few orders per day to hundreds or thousands per day. They have the expertise to handle all the problems you get in a logistics business. Not only that their security will be considerably better than any lock up I can use.
The cost of fulfillment isn’t as expensive as you may first think, not only that it saves a lot of stress and headaches, so why wouldn’t start out this way.
US Fulfilment Considerations
Before signing up for any fulfillment center in the USA there are a few considerations to be aware of.
The US is a huge country, the US is around 40 x bigger than the United Kingdom, in fact, Texas alone is 2.8 x as big as the UK and this brings with it some important points.
- Location of the fulfillment center and the location of the bulk of customers
- Integrating orders from your e-commerce or CRM software
- The fulfilment costs for shipping and managing returns
Let’s address these three issues one by one, starting by considering the best location for your US fulfillment center.
US Fulfilment Center Location
When you are planning your product I would highly recommend you sit down and plan where geographically you think the bulk of your sales will come from. That way you can plan where you want your fulfillment center location.
Most established fulfillment companies have warehouses dotted all around the US. Multiple warehousing in large countries is essential, and having stock in fulfillment centers in separate locations means faster shipping times and cheaper shipping costs for us.
That said, it does take planning.
If you expect to be selling the bulk of your product on the east coast, New York, Boston, Philadelphia, and the “West Coast”, California San Francisco Los Angeles then it makes sense to have a fulfillment center in both areas.
Likewise, if what you are selling is really only for one region, because that is how you are doing your marketing, then it makes sense to have only one fulfillment center in that region.
You would just accept higher shipping costs outside of your local area until you have enough sales to allow for a fulfillment center elsewhere.
I have read in some guides online that suggest you pick the fulfillment company nearest to your manufacturer but this only makes sense if you have a “Just In Time” business model because your customer shipping times and your shipping costs are much more important.
When you are just launching a business most of this will be intelligent guesses, after 6 months or a year you will have a much more accurate picture of where you sell to and therefore you can adjust your fulfillment accordingly.
Fulfilment Software Technology and Integration
If you’re not keen on spending every day waiting on orders to arrive and then send them over to your fulfillment center manually, then you need to automate this process.
In the past, I have used different methods from manual to software, but for my new venture, I will be using Ontraport. Ontraport will be my customer relationship manager as well as my e-commerce software and so it was important that I selected a fulfillment center that could integrate with this platform.
Unfortunately, this was easier said than done because currently only one fulfillment center FULLY integrates into Ontraport and that is Accutrack.
There are alternative solutions, you can use a third-party service such as Zapier and this allows you to send and receive order information to other platforms. One such platform is called ShipStation, they manage your labels and tracking numbers from the shipping provider.
Example of how to the Ontraport and ShipBob Integration via Zapier would work.
I talked to ShipStation a few times on the best way to integrate their solution into Ontraport. Whilst they were incredibly helpful the system was not as automated as I hoped for. This is more a failing at Zapier and Ontraports end though and not to do with ShipStation and was more to do with limitations on the API connectivity.
Benefits of ShipStation Video
According to Ontraport, the problem at the moment is automating the quantity of the ordered product across to ShipStation. That said, as I am bundling tubs into 1,3 or 6 packages then this may not be an issue as the quantity will ALWAYS be one.
USA Fulfillment Center Fees
Most fulfillment centers will split the cost of picking and packing your customer orders and the shipping cost.
One of the contenders for my US fulfilment was ShipBob they are a little different as they charge a Total Fulfilment Cost. This means once you have submitted the order, dimensional size, and weight, and the location they will provide one price per order processing.
The only caveat is the number of items in the order, up to five items in an order are covered with this one-off fee. Additional items are then charged on top. So, my larger bundle of 6 tubs will incur an additional fee – this begs the question of whether I reduce my large bundle to 5 tubs instead of 6!
Breakdown of fees you can typically see with fulfilment centers:
- Receiving Inventory (either priced per “man” hours or per pallet)
- Monthly Storage Fee (priced by bin or pallet)
- Pick and Pack (first item in your order)
- Additional items in the order
- Inserts (any promotional inserts)
- Returns processing (handling returns sent back by customers)
- Integration API work (if you require technical assistance in integrating your systems – not offered by all fulfilment centers)
- Kitting and bundling (hourly fee to assemble any kits or bundles required)
US Fulfilment Centers I Personally Contacted
I contacted many, and I mean many US-based fulfillment centers, some 15 in total some didn’t deal with “start-up” companies as they required a certain order volume, which I won’t achieve in my first run.
I sent out the same information to all the companies some asked for more information whilst others gave me a standard pricing list.
Contacting the fulfillment companies was fairly labor-intensive and researching the best US fulfillment centers to use for my e-commerce company took a lot more time than I initially thought. However, despite having some companies not interested in my business there were some that were.
Fulfilment Matchmaking Service
A quick shout out to a site called Warehousing and Fulfilment who are basically a lead generation site designed to help put you requirements out to suitable fulfilment companies – a fulfilment matchmaking service as they call themselves.
I gave them a try and they ended up reaching out to five different vendors. They recommend replying to all the vendors who contact you, mostly I think to ensure the vendors believe the site does provide potentially valuable leads. Also, if they have taken the trouble to reach out to you, the least you can do is to reply!
In the end I was in contact with over 15 US-based fulfillment companies.
Sorting through the information took time and making a decision completely on price just isn’t possible, because there are so many permutations
Here is a summary of the feedback received from various USA based fulfillment centers split into two lists; non-startup friendly and those that are start-up friendly.
Non Start-up Friendly US Fulfilment
- Fulfillment.com” – These guys were highly recommended by a recent mastermind I attended in Singapore. Sadly for me this company only deals with businesses already doing 50 plus orders per day. As I’m just starting out, I have to keep them in mind for later
- Redstagfulfillment.com – Came highly recommended by a friend of mine who uses them extensively in his business in the USA and Canada. I contacted them and unfortunately, they only deal with established businesses and not start-ups
- Pitneybowes.com – There parcel service is a shipping consolidator, and their transportation network is scaled for 250-300 orders/day minimum on delivery, and around 2,000/month minimum for SmartLabel returns services. On pick/pack fulfilment services – approximately 5,000/month
- USAfill.com – I reached out to these guys by sending them a quick email and had a really nice email within 8 hours from the VP. Unfortunately, they have monthly minimums of 1,500 orders or more and so wouldn’t be a good fit for me. They are super responsive though and so may well contact them when I reach this level.
Start-up Friendly US Fulfilment
- ShipMonk.com – I contacted these guys for a more specific quote to give me a rough idea of the costs with them. This would also let me see how responsive they were and whether they could be the right service.
They contacted me and asked for information on my business, I replied and didn’t hear back from them for 2 weeks when they eventually replied they did apologize and say they don’t integrate with Ontraport and that possibly the only option is via manually sending over a CSV file – which wouldn’t be ideal. Checking their ShipMonk Integration page though and I saw ShipStation and so this is an option. - JetFulfillment.com – One of the contacts from the lead generation site, looking at their website it shows limited information and as I used to be in the web business it’s my humble opinion it needs a serious make-over. The initial contact gave some brief information on their location near to Atlanta and explained space for holding stock is no issue. I received no prices to base my decision on but to be blunt I wasn’t too impressed and so didn’t follow up.
- Sweetwaterlogistics.com – Another contact from the lead generation guys. Not the greatest of websites but a really great introductory email from Kari from the Sales team that included brief information on them and a couple of attachments (their Executive Summary and pricing information. Having this information made it so much easier for me to follow up. The pick and pack prices are reasonable and they integrate via Ontraport or ShipStation. The only thing I didn't like is the $250 set up fee and monthly $100 integration fee for ShipStation. Considering most platforms do this for free, this is an expense I wouldn't be keen to incur.
- Asdww.com – Lead generation contact and received an intro and price list for their services. Initially, my thoughts were that the returns processing was a bit higher than most of their competitors by $1 per return. Also, there were charges for the box if not supplied by us ranging from $1.25 to $2.50, which would need to be added to the fulfillment cost. I replied wishing to clarify the costs to ensure I could make an informed decision.
- Webcommercefulfillment.com – These guys were super quick in replying to my questions, I was really impressed! I like the fact they sent lots of information about their set-up, including the size of their facilities, staff count and technology they use as well as their transparent this makes making a decision really easy if only everyone was like this.
They are based in Wilson, NC where they have two facilities. They integrate with ShipStation, which was great to see. They charge a base order fee and then per item depending on size. The returns processing is the same as their “pick and pack” fee plus a 30% fee per order. As with many fulfillment warehouses, they get discounted shipping rates due to them sending out in bulk, which looks to from 17% to 72% cheaper.
- Verdefulfillmentusa.com – Reached out to these guys and received a response within 24 hours with a very in-depth introduction to their company and what they can do for me. I initially missed this reply from them but then completed their details and awaited feedback on whether we’re a good fit or not.
- Shipbob.com – Their website lets you sign up with them and they have a web setup onboarding process that’s pretty good.. You get allocated a sales contact representative that you can reach out too. These guys were also recommended by ShipStation as they integrate very well with them.
The ShipBob service is the only US fulfillment company that charges a total “fulfillment cost per order” where the cost of the fulfilling and shipping you order is priced together.
- Shipwire.com – I set up my account online with them and followed their automated on-boarding system, which was pretty intuitive as well. Couldn’t find the option as per the help on the Shipstation website! But they are recommended by Shipstation as a service provider so we hope so.
- Pickandship.com – I contacted these guys and they provided an outline of their costs, which seem fairly cheap compared to many of the suppliers I received quotes from. Interestingly they sent an agreement for me straight away for me to sign with them. Not a lot of detail in the email but outlined they have a public API that “our developer” would be able to use to integrate into ShipStation.
- Acutrack.com – This company is currently the only fulfilment center that is integrated seamlessly into Ontraport and so contacted them about their services. I was keen to learn more about them as potentially this could save a lot of time and integration hassle.
I received the pricing information back and the guys charge $199 for setting up and integrating into Ontraport, which if this works as outlined would be worthwhile as this would be direct and no messing around with other applications or services.
They charge a box cost from $1.50 to $2.50 which would be added to the $1.75 to $2.25 per order shipping plus costs. This is a little more than other services seen here.
My US Fulfilment Center Shortlist
Research for “The best US fulfilment center” exhausting but I now have a list of potential suppliers and have made a short list of the fulfilment companies I’m most likely want to work with.
In an ideal world, I would like seamless integration with my CRM of choice, Ontraport. Unfortunately, there is only one fulfillment provider who integrates directly, which is Acutrack.
Other options involve hooking up a third-party solution ShipStation and then another tool Zapier to provide the two-way communication between the services. This makes me a little nervous as we’re then relying on 4 systems talking to each other.
That said, most solutions these days require integration through other 3rd party software and so fairly standard.
- Acutrack – Two fulfilment centers in the US (CA and OH). Big plus is that they fully integrate into Ontraport without the need of third-party software. Costs as separated into order handling, pick and pack per item, box materials and shipping.
- ShipBob – Five fulfilment centers all over the USA. Great backend and total fulfillment cost that includes both order pick and packs, with shipping cost too. Would need to integrate using ShipStation in order to communicate between Ontraport and ShipBob to automate.
I am still testing both these two solutions out at the moment and once I have made a final decision will update the post, along with outlining the integration steps required.
Hi Adam,
Very helpful information you have provided and well explained.
Thank you for taking the time!
By the way, do you have experience introducing supplements to retailers?
Sincerely,
Ariel
Thanks Ariel.
Wholesale or distribution I am not sure about but I do have a friend of a friend who works in this area. I will look to see if I can interview him for my blog.
Adam
Hi Adam,
Thanks for being so transparent. I’m at the start of this process with my own business looking to expand into the US and working a full time it’s quite a daunting process but now I have a good idea where to start. Thank you very much!
Hi Leigh,
You’re most welcome. Reach out to me via my contact page if you need further help.
Adam
Hi Adam, I’m currently going through your step by step guide. I can’t believe how much information you are giving away for free. It’s extremely helpful, Thanks!
Thanks, Anton I appreciate the feedback. So, you in the process of developing a supplement brand at the moment? Happy to have a chat and more than welcome to help if I can. Hit me up on Facebook, or send me an email.
Cheers,
Adam
I’ve got some supplement review sites, always fancied sending the traffic to my own offer instead so I can have a bit of protection from Google updates. Nothing related to Super Green’s by the way lol 🙂 It’s really impressive to see what you’ve done.
Hey Anton,
How you getting on with your supplement? Would be great to see how your doing.
Adam