Finding fulfillment in e-commerce can be very much like finding fulfillment in life: It is different for each individual and, sadly, some will never find it. Those of you who provide some type of downloadable product, I envy you. Those who need to send a physical product from point A to point B, read on.

It would be nice if there were some magic formula to immediately determine your best fulfillment option. Instead, the selection process involves identifying the requirements of your product(s) and the degree of control that you would like to exercise over your order fulfillment process, before you select your vendor. Let's start by identifying some of the most significant variables.

The Product

Different products have different requirements. For example, the requirements for handling and shipping bowling balls differ dramatically from those for light bulbs. Does your product require refrigeration or other environmental conditions, such as humidity ��and if so, what capabilities does the fulfillment house have to provide them? Because a fulfillment house will not only ship your product but inventory it as well, the physical space required to store your product will greatly influence your fulfillment price. It is unrealistic to expect a company to dedicate vast storage space per item and survive on a couple of dollars per transaction, because it pays rent by the square foot. Next, consider the dynamics of moving your product. Can someone hand carry your product to the loading dock, or is a forklift required? What about fragility? Loss ratios for glassware are much higher than for high-impact plastic, so make sure you discuss who is going to pay for any damage, and get it in writing. Meanwhile, all these factors need to be weighed against volume. How many units are you going to be shipping? We tend to think in terms of best-case scenarios, with our product keeping the entire warehouse busy, but that is rarely the case. All other things being even, you need to consider the economics of volume. The more product you move, the lower the cost per unit for the fulfillment house, which translates into the lowest cost to you. Remember, a high-margin, low-volume item is far more advantageous for you than for the fulfillment house.

Your Needs

Your needs may be as varied as the products themselves. Are you running this business in addition to your full time job? Are you capable of using your computer and the huge array of available electronic communications techniques? Do you need personalized service from your fulfillment house? What is the daily cutoff time, after which received orders will be sent the following day? What time zone is the house located in? Is it open on weekends? What types of inventory control measurement will you require, and what programs will you be using to track it? If you have date-critical delivery concerns, can your fulfillment house stagger its shipping so that all customers will receive your product on the same day? Different fulfillment houses excel at fulfilling different needs, so be sure your vendor of choice excels at fulfilling your needs.

My Company's Requirements

At Flatrock Technology Consultants Inc., we looked first for a company we could work with. That meant that we needed to find a company that could provide the broadest range of service and communication options. For example, communication not only means that I can call the company on the phone, but that they must be able to do the following:

• Accept a .dat (data) file (or equivalent) to initiate an order
• Generate all requested documentation
• Integrate the information with their vendors' computers as well as with their own inventory and billing programs

In addition, they must be able to meet our turnaround requirements to receive, warehouse, and ship our product within one day.

No Simple Formula

You will have to stir all the above-mentioned variables into the pot in order to make your decision. We are paying approximately $2 per item for our fulfillment house to handle our products. They are relatively small (6 by 6 by 12 inches), have few environmental requirements to consider, are virtually indestructible, and (unfortunately) have manageable volume requirements. We have a crackerjack representative assigned to our account, and their company's computer system has the communication sophistication to make our order management and inventory control a simple and routine event. We know there are less expensive options, but when we stirred the pot, we chose the vendor that was able to provide the highest level of both service and communication at a price we were willing to pay.

About the Author:
Bruce Resnick

Click here for more info from this author...