This post first featured in the Modern Retail Guide to Fulfilment August 2020. To read the full ebook click here, or scroll to the end of the page to view on page-turning software.
Retailers that are in the early stages often start with in-house fulfilment, reducing their outgoing costs and making a profit while understanding the demand for their products.
Here’s everything you need to know about in-house fulfilment.
What is in-house fulfilment?
This is the process of carrying out your own fulfilment, without the need for any external dropshipper or logistics partner. Sometimes referred to as the self-fulfilment model, this can range in size from one-person operations to larger scale investments.
Essentially, it sees the retailer manage manufacturing, inventory storage and warehousing in the same place. When an order is placed, the retailer picks, packs and ships it to the customer.
What happens when retail operations grow?
Some retailers will choose to outsource their fulfilment when they reach a certain size, however in-house fulfilment is still possible, even if it reaches an overwhelming level of demand. In this case, it becomes necessary to build a suitable fulfilment infrastructure.
If your business begins to send large volumes of orders, negotiating rates with delivery services such as FedEx and DHL can help you to keep costs down and gain a competitive advantage.
What do you need for in-house fulfilment?
There are many different aspects of operations that you must think about when running fulfilment in-house. These include:
- Suitable warehouse space
- Warehouse equipment
- Warehouse staff
- Choosing suitable software
- Insurance for workers and inventory
Advantages
- In control of stock, picking, packing and shipping
- For small retailers that do not require staff, this can be cost-effective as you only need to pay for shipping
- Relatively straightforward process
Disadvantages
- Need to gain an initial understanding of what is required
- Time-consuming to pick, pack and send orders yourself
- Can be expensive to pay for warehousing, equipment, staff, software, insurance etc.
- It requires management as it grows and additional people become involved in your in-house fulfilment
Read the full Modern Retail Guide to Fulfilment August 2020 below.
Holly brings a wealth of experience in both print and digital publishing. As Modern Retail’s Content Editor, Holly is passionate about helping independent retailers to thrive in today’s ever-changing market.
