With approximately 5.2 trillion U.S. dollars worldwide in 2021, eCommerce continues to grow at an unprecedented pace, the demand for eCommerce warehousing has become more pressing than ever. The online shopping experience has become increasingly complex, and eCommerce retailers need to streamline their supply chain to stay competitive.
In this blog post, we’ll cover everything you need to know about eCommerce warehousing, from what it is and why it’s important to the different types of eCommerce warehousing, 3PL services, and the benefits of using a fulfillment service.
What Is eCommerce Warehousing?
eCommerce warehousing refers to the storage of goods that are sold online. It’s a vital component of the eCommerce supply chain that is responsible for ensuring that goods are stored, organized, and shipped to customers in a timely and efficient manner. Warehousing is critical for eCommerce retailers who need to manage their inventory levels, minimize the cost of storage and shipping, and ensure that customers receive their orders on time.
Dropshipping Ignores Warehousing and Can Lack Control
While dropshipping has become increasingly popular in recent years, it ignores the need for warehousing entirely. Dropshipping involves shipping products directly from the supplier to the customer, bypassing the need for warehousing altogether. However, this lack of control over the product can result in poor customer experiences and may impact the overall reputation of the eCommerce retailer.
Why eCommerce Warehousing is Important
eCommerce warehousing plays a crucial role in the success of eCommerce retailers. Here are some of the reasons why eCommerce warehousing is important:
Efficient Inventory Management
eCommerce warehousing helps retailers manage their inventory levels by providing a secure and organized space to store products. This helps retailers keep track of their stock levels and ensures that they have the right products on hand to meet customer demand.
Faster Shipping Times
Warehousing allows retailers to keep products in stock and ready to ship, which means that they can fulfill orders quickly and efficiently such as a kitting warehouse. This can lead to faster shipping times, which can be a key selling point for eCommerce retailers.
Cost-Effective Shipping
Warehousing can help eCommerce retailers save money on shipping costs by allowing them to consolidate orders and ship products in bulk. This can help reduce the cost of shipping and make it easier for retailers to offer free shipping to customers.
Types Of eCommerce Warehousing
There are several types of eCommerce warehousing available to retailers. Here are some of the most common types of eCommerce warehousing:
Leased
Leased warehousing involves renting a space in a warehouse or distribution center. This is a popular option for small eCommerce retailers who need a space to store their inventory but don’t want to invest in a warehouse of their own. Leased warehousing is flexible and can be customized to meet the needs of individual retailers.
Warehousing From Home
Some eCommerce retailers choose to store their inventory in their own homes. This can be a cost-effective option for small businesses that don’t have a lot of inventory to store. However, it’s important to note that this option may not be suitable for all retailers, especially those who have a large amount of inventory. Not to mention, managing inventory from home can be a time-consuming and labor-intensive process.
On-demand Warehousing
On-demand warehousing is a relatively new concept that allows eCommerce retailers to rent warehouse space on a short-term basis. This is a great option for retailers who need extra space during peak seasons or for those who are testing a new product line. On-demand warehousing is flexible and can be customized to meet the needs of individual retailers.
Fulfillment Centers
Fulfillment centers are third-party logistics (3PL) providers that specialize in eCommerce fulfillment. These centers provide a range of services, including warehousing, picking and packing, and shipping. Fulfillment centers can be a great option for eCommerce retailers who want to outsource their fulfillment operations to a trusted third party.
3PL Services Vs eCommerce Warehouse Management
While 3PL services and warehousing and shipping for eCommerce are similar, there are some key differences between the two. Here are a few of the main differences:
Control
eCommerce warehouse management gives retailers more control over their inventory and shipping operations. With eCommerce warehouse management, retailers are responsible for managing their inventory levels, picking and packing orders, and shipping products to customers.
Customization
Warehousing and shipping for eCommerceallows retailers to customize their warehouse operations to meet their specific needs. Retailers can choose the layout of their warehouse, the type of storage racks used, and the processes used for picking and packing orders.
Cost
eCommerce warehouse management can be more cost-effective than 3PL services, especially for larger retailers. With eCommerce warehouse management, retailers can avoid the fees charged by 3PL service providers and have more control over their costs.
The Benefits of Using a Fulfillment Service
Using a fulfillment service can offer several additional benefits to eCommerce retailers. Here are a few of the main benefits:
Scalability
Fulfillment services are designed to be scalable, which means that they can handle large volumes of orders without any issues. This can be especially beneficial for eCommerce retailers who experience seasonal spikes in demand.
Access to Technology
Fulfillment services often have access to the latest technology and software, which can help retailers streamline their operations and improve their efficiency.
Critical and Related Services
In addition to warehousing and shipping, many fulfillment services also offer a range of critical and related services, such as returns management, order tracking, and customer support.
It Opens Up Options For Critical and Related Services
The right fulfillment service can open up a world of opportunities for eCommerce retailers. By partnering with a trusted 3PL provider such as Xpress360, retailers can leverage their expertise and access a range of critical and related services that can help them succeed in the eCommerce space.
For example, we offer Xpress360 these comprehensive services with warehouse and 3PL fulfillment services:
- Kitting services: Our kitting services save retailers time and money by combining multiple products into one single unit for shipment.
- Consolidation: Our consolidation services allow retailers to bundle multiple orders into one delivery and reduce shipping costs.
- Cross-docking: Cross-docking helps retailers reduce the time their products spend in warehouses, which can help them get orders to customers faster.
- Quality Inspection: We offer quality inspection services to ensure that all orders are correctly picked and packed before they’re shipped out.
Explore Our eCommerce Warehousing Solutions
eCommerce warehousing is a critical component of the eCommerce supply chain. It helps retailers manage their inventory levels, reduce shipping costs, and improve their efficiency.
While 3PL services and eCommerce warehouse management are similar, there are some key differences between the two. Finally, using a fulfillment service can offer several benefits to eCommerce retailers, including scalability, access to technology, and access to critical and related services.
If you’re looking for eCommerce warehousing solutions, we invite you to explore our range of services. Our experienced team can help you find the right solution for your business.
