Thinking of Outsourcing Your Ecommerce Fulfilment but Worried About the Potential Problems?

We Look at 8 Potential Issues You Might Face When Outsourcing Your Fulfilment to a Third Party.

Outsourcing your ecommerce fulfilment to a third party partner can have both advantages and disadvantages. While, as we discussed in our previous post here,  it can provide many benefits such as cost savings, the freedom for you to scale up and grow and access to specialised expertise, you would not be human (or sensible!) if you were not worried about what potential risks and challenges might be involved.

One of the key concerns you are sure to have is will you lose control of your business if you outsource the fulfilment side? When you outsource fulfilment, you are letting go of direct control over the process. This can lead to a loss of visibility and transparency, making it harder to ensure quality control, timely deliveries, and customer satisfaction. You start to feel a distance from your customers. Mismanagement or errors by the third-party provider could reflect poorly on your business.

The quality of fulfilment may not meet your expectations or align with your brand standards. Third-party providers may not prioritise quality control to the same extent as you would, resulting in damaged products, inaccurate order fulfilment or inadequate packaging.

Another key concern is data security and privacy risks because you are sharing sensitive customer information, including addresses, payment details, and order histories, with the third-party provider. There is a potential risk of data breaches or mishandling of customer data, which could harm your reputation and result in legal consequences.

Effective communication is crucial in fulfilment operations. Outsourcing introduces an additional layer of communication between you, your customers, and the third-party provider. If there are breakdowns or delays in communication, it can lead to misunderstandings, order errors and customer dissatisfaction.

One you many not have thought of is that while outsourcing your fulfilment can offer you the opportunity to grow and scale up, it may limit your ability to quickly adapt to changing market conditions or customer demands. Third-party providers might have rigid processes or long lead times, making it challenging to make rapid adjustments to your fulfilment strategy.

If you rely heavily on a single third-party provider for your fulfilment, you become vulnerable to their operational issues, financial instability, or even a sudden termination of services. This dependency can pose risks to your supply chain and overall business continuity.

You many find you have different core values to your provider which could lead to problems with communication or finding a speedy resolution should issue arise. You will, we are sure, have spent many hours defining your brand and what you stand for and the values you hold. Your ecommerce fulfilment partner may have a very different set of values. Ask them what they stand for and through which behaviours they demonstrate these values and see if they align with yours.

A final thought is that, if you outsource fulfilment to a fulfilment centre in another country, you may encounter cultural differences and language barriers. These factors can lead to misunderstandings, miscommunications, and difficulties in aligning your business objectives and customer expectations.

So, now we’ve worried you with all the things that could go wrong, how do you ensure they don’t?

The answer: thoroughly research potential partners and then ask them these very questions! Put them under the spotlight! Once you have selected a provider, establish clear contractual agreements, maintain open lines of communication, and regularly monitor their performance. Conducting due diligence and establishing robust quality control measures can help minimise the potential pitfalls associated with outsourcing fulfilment operations.