For most people entering the Ecommerce business, fulfillment is a new concept and one with which they may not have any experience.  Selecting a fulfillment company to support your business' activities can be a daunting task.

 

Once you select and enter into a relationship with a fulfillment company, the service you receive will be critically important to the success of your company and to your customer's perception of your business.  In fact, if your customers perceive that your service is not up to their standards, they will not think highly of your business and the "lifetime value" of your customer will diminish dramatically.

 

Short of price, what should you ask of the prospective company and how should you evaluate them on their performance?  Of course the cost of the service is always important, but there are a number of other critical factors, as well.  Here are some important questions to ask during the interview or visiting stage to fully evaluate their

capabilities and performance.

 

What is your accuracy rate for correctly fulfilling orders?
If you get a 'round number' answer like "over 99%" accuracy, it probably means that they do not track or measure the accuracy, so saying 99% will sound like a good, high number.  In fact they should be tracking and measuring their accuracy, specific to each client, on a monthly basis and know exactly what their accuracy rate is.

At IFS our measurable accuracy rate is 99.9987% for all of 2010.  Ask us what it is for any month YTD and we can tell you.

 

What is your commitment to shipping my orders within a specified time frame?
Typically orders ship "within 24 hours" of receipt.  This becomes rather difficult to track due to time zones, and other issues, such as if you place the order online at 2:00 A.M, if the order is entered on a weekend or holiday, if the product is not available in inventory, or if the credit card is not approved.

IFS commits, in writing, to ship 95% of all "good to go" orders the same day they are received and 100% of those orders within the next business day.

 

If I decide to make changes in my business, what happens when I also decide to make changes in the services you provide?
Flexibility from a service provider is critical to the success of any business.  Seldom does a business grow or work exactly as you have it laid out in your business plan.  When that happens, your service provider must be flexible and receptive to meeting your changing needs.  Some companies are very good at providing services IF you do it their way and with their system (i.e. EBay or perhaps Amazon)

At IFS we are accustomed to making changes according to our clients' needs and although some processes as just more efficient being done a certain way, we have the flexibility and - just as importantly - the attitude to change with our clients.

 

What should I expect to pay for fulfillment services?
That is a great question and one that everyone is interested in understanding.  Short of simply selecting the "lowest price" and learning later that it may not be the best criteria with which to evaluate a company, there are standards within the Direct to Consumer industry by which you can compare your costs with companies that do their own fulfillment as well as with companies that pay to outsource their fulfillment.  The formula goes like this:

 

This formula will help you to determine what you should pay for these services and to manage your business according to these standards.  This percentage should typically be between 10% and 15% of your average transaction.

 

 

Remember that it is always possible to find a "low cost provider," but - as is commonly the case - you get what you pay for.  It is easy for a fulfillment provider to cut services in order to arrive at a cheap price, but as a result, your business may suffer.  We strongly encourage you to concentrate on the services you will receive, and not just on the cost.

 

What references do you have on your company?  May I speak with some of your current clients?
Your fulfillment partner should always be receptive to providing you with references.  For IFS, you'll find several client comments here, but we will also gladly provide you with additional companies to speak with after our initial discussions.

For most people entering the Ecommerce business, fulfillment is a new concept and one with which they may not have any experience.  Selecting a fulfillment company to support your business' activities can be a daunting task.

 

Once you select and enter into a relationship with a fulfillment company, the service you receive will be critically important to the success of your company and to your customer's perception of your business.  In fact, if your customers perceive that your service is not up to their standards, they will not think highly of your business and the "lifetime value" of your customer will diminish dramatically.

 

Short of price, what should you ask of the prospective company and how should you evaluate them on their performance?  Of course the cost of the service is always important, but there are a number of other critical factors, as well.  Here are some important questions to ask during the interview or visiting stage to fully evaluate their

capabilities and performance.

 

What is your accuracy rate for correctly fulfilling orders?
If you get a 'round number' answer like "over 99%" accuracy, it probably means that they do not track or measure the accuracy, so saying 99% will sound like a good, high number.  In fact they should be tracking and measuring their accuracy, specific to each client, on a monthly basis and know exactly what their accuracy rate is.

At IFS our measurable accuracy rate is 99.9987% for all of 2010.  Ask us what it is for any month YTD and we can tell you.

 

What is your commitment to shipping my orders within a specified time frame?
Typically orders ship "within 24 hours" of receipt.  This becomes rather difficult to track due to time zones, and other issues, such as if you place the order online at 2:00 A.M, if the order is entered on a weekend or holiday, if the product is not available in inventory, or if the credit card is not approved.

IFS commits, in writing, to ship 95% of all "good to go" orders the same day they are received and 100% of those orders within the next business day.

 

If I decide to make changes in my business, what happens when I also decide to make changes in the services you provide?
Flexibility from a service provider is critical to the success of any business.  Seldom does a business grow or work exactly as you have it laid out in your business plan.  When that happens, your service provider must be flexible and receptive to meeting your changing needs.  Some companies are very good at providing services IF you do it their way and with their system (i.e. EBay or perhaps Amazon)

At IFS we are accustomed to making changes according to our clients' needs and although some processes as just more efficient being done a certain way, we have the flexibility and - just as importantly - the attitude to change with our clients.

 

What should I expect to pay for fulfillment services?
That is a great question and one that everyone is interested in understanding.  Short of simply selecting the "lowest price" and learning later that it may not be the best criteria with which to evaluate a company, there are standards within the Direct to Consumer industry by which you can compare your costs with companies that do their own fulfillment as well as with companies that pay to outsource their fulfillment.  The formula goes like this:

 

This formula will help you to determine what you should pay for these services and to manage your business according to these standards.  This percentage should typically be between 10% and 15% of your average transaction.

 

 

Remember that it is always possible to find a "low cost provider," but - as is commonly the case - you get what you pay for.  It is easy for a fulfillment provider to cut services in order to arrive at a cheap price, but as a result, your business may suffer.  We strongly encourage you to concentrate on the services you will receive, and not just on the cost.

 

What references do you have on your company?  May I speak with some of your current clients?
Your fulfillment partner should always be receptive to providing you with references.  For IFS, you'll find several client comments here, but we will also gladly provide you with additional companies to speak with after our initial discussions.