End-to-end fulfilment: why you should let someone else sweat the small stuff

Ecom­merce is boom­ing, and with it the busi­ness­es that have launched off the back of the push towards more spe­cialised online retail com­pa­nies are begin­ning to scale up rapid­ly. But any founder knows that stan­dards have nev­er need­ed to be high­er, with strength­ened com­pe­ti­tion and increas­ing­ly picky cus­tomers.

What could once be explained away or blamed on poor couri­er firms, delayed post and glitchy cus­tomer ser­vice is no longer pos­si­ble – the sec­tor has matured and so have cus­tomer expec­ta­tions. Which is why end-to-end ful­fil­ment – from pro­cess­ing orders to pick­ing and pack­ing items, through to deliv­ery, returns and after­sales com­mu­ni­ca­tion and sup­port – has become a major area of inter­est for com­pa­nies look­ing to build their pres­ence in the world of ecom­merce.

Enabling a seam­less cus­tomer expe­ri­ence takes lots of time. Enter end-to-end ful­fil­ment. By work­ing with third-par­ty part­ners, organ­i­sa­tions can stream­line and brand every ele­ment of the cus­tomer jour­ney, right down to brand­ed “Sor­ry we missed you” deliv­ery slips. 

End-to-end ful­fil­ment takes the has­sle out of one of the hard­est parts of any ecom­merce expe­ri­ence. How­ev­er, it comes with as many risks as it does rewards. “Get­ting a pack­age from A to B is a lot more dif­fi­cult than it sounds, par­tic­u­lar­ly for a busi­ness that is expand­ing,” says Enda Bres­lin, gen­er­al man­ag­er for Europe at Ship­Bob, a ful­fil­ment com­pa­ny. “The logis­tics of ship­ping mul­ti­ple pack­ages every day is a mas­sive time drain and can hold you back.”

Being the ‘everything’ store

“That divi­sion between being a retail­er and being a deliv­ery com­pa­ny that han­dles ful­fil­ment has always been quite prob­lem­at­ic,” says retail ana­lyst Bryan Roberts. “Obvi­ous­ly, there are economies to be had if you run your own ful­fil­ment and oper­a­tions – you’re not pay­ing a pre­mi­um for a third par­ty to deliv­er that ser­vice for you.” 

But for many com­pa­nies that aren’t major play­ers like Tesco or Ama­zon, the cost and has­sle of doing so is far too expen­sive. It’s like run­ning a busi­ness with­in a busi­ness.

The logis­tics of ship­ping mul­ti­ple pack­ages every day is a mas­sive time drain and can hold you back

For that rea­son, it’s become more com­mon for ecom­merce com­pa­nies to out­source the end-to-end ful­fil­ment process to third par­ties, who they expect to car­ry the weight when it comes to the tricky busi­ness of bring­ing prod­ucts to cus­tomers. 

Yet doing so comes with its own draw­backs, says Roberts. “A lot of retail­ers have realised that by out­sourc­ing ful­fil­ment to third par­ties, you’re putting your brand equi­ty in their hands,” he says. 

While many cus­tomers can iden­ti­fy most major deliv­ery com­pa­nies, in many cas­es the deliv­ery process is white labelled, with third-par­ty employ­ees pre­sent­ing them­selves and their process­es as the busi­ness they’re pro­vid­ing a ser­vice to. Rather than a couri­er such as DPD or Evri “Sor­ry we missed you” label slipped under your customer’s door, it’s increas­ing­ly one in your business’s name. 

That’s all well and good if the deliv­ery dri­ver gen­uine­ly calls when your cus­tomer is out but it jeop­ar­dis­es your rep­u­ta­tion if some­thing goes wrong, or the per­son sup­posed to be doing the deliv­er­ing fails to knock on the door. “That’s where rep­u­ta­tion­al dam­age can occur,” says Roberts.

Go in with your eyes open

Avoid­ing rep­u­ta­tion­al dam­age is why it’s more impor­tant than ever that busi­ness­es look­ing to con­tract out their end-to-end ful­fil­ment ser­vices ensure that the com­pa­ny they choose is rep­utable and has their best inter­ests in mind. “You need to be cog­nisant that they are, to some extent, hold­ing your brand equi­ty,” he says. “And if they don’t ful­fil their side of the bar­gain in an ele­gant fash­ion, you’re get­ting dragged into it, even though you’re not respon­si­ble for that part of the sup­ply chain.”

Of course, ensur­ing that any­one you enter an agree­ment with shares your inter­ests and brand val­ues is only part of the equa­tion. There’s also the bot­tom line to con­sid­er. “For lots of retail­ers, it doesn’t make sense to have that end-to-end capa­bil­i­ty,” says Roberts. The cap­i­tal invest­ment in buy­ing a fleet of trucks and deliv­ery dri­vers to staff them doesn’t make sense, so you’re often look­ing at pick­ing ful­fil­ment part­ners based on price. 

But don’t com­pro­mise qual­i­ty for cost, warns Roberts. “The abil­i­ty for con­sumers or shop­pers to sep­a­rate out var­i­ous parts of the chain can be hard to pick apart,” he says. “If you order from a retail­er and the deliv­ery com­pa­ny doesn’t deliv­er in a sat­is­fac­to­ry fash­ion, it’s you that can be affect­ed.” Still, busi­ness­es often seek out deliv­ery “at an appro­pri­ate – and gen­er­al­ly low­est – cost point”, says Car­men Carey, chief exec­u­tive of Sort­ed, a deliv­ery expe­ri­ence plat­form. 

Four key areas of end-to-end fulfilment

How­ev­er, that’s just one of four key areas that Carey believes busi­ness­es should think about when con­tract­ing with an end-to-end ful­fil­ment part­ner. They also need to think about how the deliv­ery process match­es the promis­es made to con­sumers when they check out. They need to be aware of the con­tent and updates that they and their cus­tomers will be giv­en about the pro­gres­sion of their pack­age, on both the out­bound and return jour­neys (if need­ed). “And final­ly, the return being seam­less and fric­tion­less,” says Carey. “That’s what we’re try­ing to do with our cus­tomers – to ful­fil all angles of that cus­tomer expe­ri­ence through dif­fer­ent ele­ments of that par­cel life­cy­cle.”

Before flick­ing through those four ques­tions and try­ing to answer them, though, there’s a more fun­da­men­tal ques­tion to pose. Do you need a part­ner at all? “There are cir­cum­stances where han­dling ful­fil­ment inter­nal­ly is the right call,” says Bres­lin. “For low-vol­ume, per­son­alised prod­ucts, deliv­er­ing your­self can make more sense than out­sourc­ing. But once you break the thresh­old where deliv­er­ing inter­nal­ly is becom­ing so time con­sum­ing it is stop­ping your progress, it is time to out­source. If your prod­uct is fea­tured on TV or an influ­encer shares it, that thresh­old can be crossed quick­ly.”

Then it’s about find­ing the right part­ner – and mak­ing sure you do the dos, rather than the don’ts, of end-to-end ful­fil­ment. Two exam­ples of small ecom­merce busi­ness­es that weighed up the options of whether they need­ed a help­ing hand to grow their busi­ness – and came to dif­fer­ent con­clu­sions – can be seen below. But along­side the four key checks that Carey rec­om­mends, Bres­lin has some more point­ed ques­tions you’ll need to con­sid­er.

The right fit

One major thing to con­sid­er is whether the provider is the right fit for you. Pack­ing, han­dling and deliv­er­ing T‑shirts is quite dif­fer­ent to meal packs – and spe­cialised sup­pli­ers with expe­ri­ence in spe­cif­ic areas exist for a rea­son. “If you’re a fresh food spe­cial­ist, you’ll want to part­ner with a busi­ness that is an expert in keep­ing foods cool on the move. Scope is also a big con­sid­er­a­tion,” says Bres­lin. “If you just sell prod­ucts local­ly, you’ll need a dif­fer­ent part­ner than if you are plan­ning on expand­ing inter­na­tion­al­ly.”

Like­wise, what kind of data do they pro­vide on key met­rics that help you keep track of your busi­ness? While you’re will­ing to hand over the pub­lic per­cep­tion of your busi­ness to a third-par­ty provider, you can’t out­source every­thing. 

“By out­sourc­ing with the wrong part­ner, there is a dan­ger that you will lose some of the con­trol of your qual­i­ty stan­dards,” warns Bres­lin. “Find a part­ner that pro­vides real-time infor­ma­tion on stock lev­els, deliv­ery sta­tus and num­ber of returns so you’ll be able to main­tain or bet­ter your stan­dards, and still be able to react quick­ly to oppor­tu­ni­ties.” 

And ensure that the part­ner and your rela­tion­ship with them feels right. “Ful­fil­ment is an essen­tial part of the cus­tomer expe­ri­ence and the part­ner you choose has to have the same lev­el of pas­sion and care for your busi­ness as you do.”

Get it right and the ben­e­fits are almost immea­sur­ably large. “By part­ner­ing with the right ful­fil­ment busi­ness, you can unlock sav­ings,” says Bres­lin. “The part­ner will have rela­tion­ships with deliv­ery firms and, due to economies of scale, be able to reduce costs for you. They will also pro­vide access to tools and fea­tures that you sim­ply don’t have the time to devel­op.” 

More fun­da­men­tal­ly, they let you get on build­ing your busi­ness – focus­ing on the big pic­ture while they sweat the small stuff.

Lon­don-based com­postable cof­fee-pod com­pa­ny Mov­ing Beans kept all its inven­to­ry in the shed of one of the founders, packed wall-to-wall with box­es. “As we start­ed grow­ing and doing dai­ly runs to the Post Office car­ry­ing all these box­es, it became unfea­si­ble,” co-founder Daniel Hard­ej says. “It was quite a nice prob­lem to have,” he admits, but it did dawn on them that some­thing need­ed to be done.

They began to realise that, in order to scale up, they would need to con­sid­er how to out­source deliv­ery of their prod­uct. Shut­tling box­es of cof­fee cap­sules back and forth was prov­ing too time con­sum­ing and eat­ing away at their abil­i­ty to build oth­er parts of the busi­ness. “It was at that point we thought, if we want­ed to scale beyond this, it’ll be real­ly impor­tant to get a good ful­fil­ment part­ner,” he says. “We weren’t able to jug­gle all the tasks that come along with pack­ing, labelling and post­ing all these parcels our­selves by hand.”

Hard­ej and his co-founders realised they’d soon need help when orders began reach­ing dou­ble dig­its in a day. “But once we got to push it towards 100 a day, that’s when we real­ly saw the val­ue, not just in terms of time but in cost as well,” he says.

They short­list­ed half a dozen ful­fil­ment com­pa­nies based on rec­om­men­da­tions or a Google search. Then they whit­tled it down to the ones that had expe­ri­ence work­ing with small-scale but fast-grow­ing com­pa­nies – and that had han­dled per­ish­able prod­ucts. “We were look­ing for real­ly eco­nom­i­cal pick-and-pack costs that made sure our couri­er fees wouldn’t com­plete­ly erode any mon­ey we made,” he says. 

Ini­tial­ly, the founders tried one ful­fil­ment com­pa­ny and found it good, but decid­ed to change because of a lack of proac­tive com­mu­ni­ca­tion. Anoth­er com­pa­ny offered a com­pet­i­tive bid to take over the busi­ness and promised to keep Mov­ing Beans in the loop. That has paid div­i­dends, says Hard­ej. “As we grow, we might have more niche require­ments for cer­tain cus­tomers,” he says. “Know­ing we’ve got that per­son help­ing us take care of any­thing that might go wrong, that’s a lot of secu­ri­ty and peace of mind.”

Lawrie Jones set up his Bris­tol-based health sup­ple­ments busi­ness, Stronger Bones, in Decem­ber 2021. “At the moment, it’s small vol­ume and we’re try­ing to build up our brand name,” he says. 

Of course, build­ing your brand takes time – and devot­ing brain space to that comes at the expense of tack­ling oth­er key parts of the busi­ness. That’s why Jones scoped out the pos­si­bil­i­ty of out­sourc­ing end-to-end ful­fil­ment to a third-par­ty provider.

But ulti­mate­ly, he decid­ed not to con­tract with an end-to-end ful­fil­ment com­pa­ny. The rea­son? Pri­mar­i­ly cost. “We sat down and looked at the prod­ucts we had, looked at the mar­gins on the prod­ucts and looked at what it would cost to out­source the ful­fil­ment,” he says. The sums didn’t add up.

In part, that’s because of scale: at the moment, ful­fill­ing orders isn’t a major time sink for Jones and his employ­ees. Like­wise, he found that some out­sourc­ing com­pa­nies wouldn’t con­sid­er Stronger Bones as a client because of the scale they oper­ate at. “With some organ­i­sa­tions, there are min­i­mum vol­umes,” he says. 

Most sup­pli­ers offered a fixed fee as a base­line, then a vari­able fee on top depend­ing on the num­ber of orders they were expect­ed to process on Stronger Bones’s behalf. “When we did fore­cast­ed turnover and trade vol­umes, it was easy for us to say, ‘Is this going to work for us or is it not going to work for us?’,” he explains. “With the prod­ucts we’ve got, it wouldn’t.”

There were oth­er con­sid­er­a­tions, includ­ing the risk of returns. Cus­tomers who send back prod­ucts to large online retail­ers that han­dle end-to-end ful­fil­ment, such as Ama­zon, are often grant­ed refunds as soon as the prod­uct is received. For a sup­ple­ments busi­ness like Stronger Bones, reselling any returned prod­ucts is nigh-on impos­si­ble. “It does make it eas­i­er for inter­na­tion­al trade and puts you in front of mil­lions of cus­tomers,” he says. “But you don’t own those cus­tomers.” 

That said, Jones doesn’t dis­count redo­ing the sums lat­er on. “There’ll come a point where we’re not shift­ing 1,000 units a month but are shift­ing 5,000,” he says.

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