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The 5 Signals for Outsourcing Fulfillment to a 3PL Provider

Phuc Le
July 24, 2023

Managing a high volume of orders from various sellers and ecommerce platforms can be challenging. To overcome these struggles, invest in an automated order processing system that integrates with different platforms, prioritize orders based on urgency and value, and consider expanding warehouse capacity or partnering with Third-Party Logistics Providers (3PLs). Implement predictive analytics to forecast demand patterns and negotiate shipping rates with carriers. Maintain clear communication with sellers and ecommerce platforms to stay updated on inventory and order statuses, while offering self-service options for customers. Continuously improve fulfillment processes and prioritize exceptional customer service to build trust and loyalty, ensuring a smooth fulfillment experience even during peak demand.

WHAT IS AN OUTSOURCING FULFILLMENT - 3PL PROVIDER?

WHAT IS AN OUTSOURCING FULFILLMENT - 3PL PROVIDER?

Outsourcing fulfillment to a Third-Party Logistics (3PL) Provider is a strategic business arrangement in which an eCommerce company entrusts its order fulfillment and logistics operations to an external service provider. The 3PL provider specializes in efficiently managing various aspects of the supply chain, including warehousing, inventory management, pick & pack, shipping, and even customer service.

In this partnership, the eCommerce business transfers the responsibility of storing products, processing orders, and delivering goods to the 3PL provider. The 3PL company operates from its own network of warehouses and distribution centers strategically located to facilitate faster and cost-effective shipping to customers across different regions.

The main goal of outsourcing fulfillment to a 3PL provider is to optimize the supply chain and improve overall operational efficiency. By leveraging the expertise, infrastructure, and technology of the 3PL, eCommerce businesses can focus on their core competencies, such as product development, marketing, and customer engagement, while leaving the logistics and fulfillment tasks to the professionals.

The 3PL provider handles tasks such as order processing, packing, and shipping, ensuring accurate and timely deliveries to customers. They also manage inventory levels, reducing the risk of overstocking or stockouts, and negotiate shipping rates with carriers to obtain cost savings.

THE 5 SIGNALS FOR OUTSOURCING FULFILLMENT TO A 3PL PROVIDER

  • The Impact of Filling Orders on Your Business Operations

Fulfilling orders is a critical aspect that significantly impacts the smooth running of your eCommerce business. Each day, you find yourself confronted with a multitude of tasks required to keep your online store operational and successful. From managing inventory, handling customer inquiries, executing marketing strategies, to overseeing shipping and delivery, the list of responsibilities seems never-ending. However, amidst the daily hustle, fulfilling orders stands out as a fundamental and time-consuming task.

Consider the complexities involved in picking and packing each item accurately, preparing shipments, coordinating with shipping carriers, and ensuring timely deliveries to your valued customers. These fulfillment operations demand meticulous attention to detail and can be both labor and time-intensive.

As an eCommerce entrepreneur, it's essential to recognize the pivotal role that order fulfillment plays in shaping your business outcomes. The efficiency and accuracy with which orders are processed directly impact customer satisfaction and, consequently, customer retention. Happy customers are more likely to return for repeat purchases and spread positive word-of-mouth about their experience, fostering a loyal customer base.

Moreover, streamlining fulfillment processes can enable you to divert your focus to other critical aspects of your eCommerce business. By automating certain fulfillment tasks or outsourcing them to a Third-Party Logistics Provider (3PL), you gain the freedom to concentrate on strategic growth initiatives, product innovation, marketing campaigns, and exploring new business opportunities.

In conclusion, the task of fulfilling orders is a fundamental aspect that shapes the overall success of your eCommerce business. Understanding the significance of efficient order fulfillment can help you make informed decisions on optimizing these operations. Embracing automation or partnering with a reliable 3PL can alleviate the burden of fulfillment, freeing up your valuable time to tackle essential business tasks and elevate your brand's presence in the competitive online marketplace.

  • Avoiding Stock-Outs and Overstock: The Role of a 3PL in Inventory Management

One of the gravest mistakes an eCommerce store can make is accepting payment for an order and then failing to fulfill it. Such instances severely impact customer trust and satisfaction, leading to potential cancellations and refund requests. With fierce competition in the eCommerce industry, customers are always seeking quicker alternatives, making timely order fulfillment paramount.

Stock-outs not only hinder immediate sales but also jeopardize the likelihood of customers returning to your store in the future. To prevent such scenarios, it is crucial to have a deep understanding of your current inventory levels. However, ordering excessive inventory can be equally detrimental, depleting essential revenue that could be invested in expansion, product launches, or marketing efforts. Overspending on storage for surplus products amplifies the financial strain, especially when specific storage conditions, such as climate control, are necessary.

Maintaining inventory awareness demands meticulous attention, encompassing regular counts, continuous monitoring of stock levels, and timely resupplies. Every order processed with inaccuracies or returns further affects inventory counts, necessitating real-time adjustments. Managing these complexities and swiftly responding to unexpected situations requires a dedicated effort.

When stock-outs and overstock become recurring problems, it's a clear signal to seek a partnership with a Third-Party Logistics Provider (3PL). The most significant advantage of collaborating with a 3PL lies in their ability to conduct comprehensive and sophisticated analytics on inventory and sales data. This valuable insight helps determine the ideal inventory levels, striking the perfect balance between stock-outs and overstock.

Moreover, a reliable 3PL employs cutting-edge tools to track inventory with precision, ensuring you never face shortages or excessive stockpiles. This means seamless operations with no lost sales and no unnecessary expenses on storing surplus products month after month.

Integrating your storefront with a 3PL empowers you to make informed decisions based on the most accurate and up-to-date data. Together, you can adapt to seasonal variations and dynamic market trends, ensuring you meet customer demands with agility and precision.

THE 5 SIGNALS FOR OUTSOURCING FULFILLMENT TO A 3PL PROVIDER

  • Order Errors and Returns: Emerging Challenges

Every successful store relies on repeat customers, but returns can be a big threat to that customer loyalty. When you notice an increasing number of returns, it's crucial to figure out why they're happening. Sometimes, customers might not be happy with the product or feel misled by your ads or website. However, if you're experiencing issues like incorrect, delayed, or damaged orders, it's likely related to your warehouse operations.

That's where partnering with a reliable Third-Party Logistics Provider (3PL) can make a significant difference. 3PLs follow industry best practices to handle fulfillment efficiently, and some even offer guarantees, promising fewer shipping errors. According to a study by Narvar, 48% of customers will shop again with a retailer if their return experience is easy. This means improving order accuracy can lead to happier customers and increased loyalty.

Order accuracy doesn't just reduce returns; it also improves customer experience. When you promise fast shipping and deliver on that promise, customers are more likely to trust your brand. Additionally, working with a 3PL may allow you to enhance that customer experience even more. They can provide special packaging, use your brand's colors, and add your logo stickers to create a lasting impression.

Addressing returns effectively can have an immediate impact on your cash flow. According to a report by Brightpearl, returns can account for up to 10% of a retailer's revenue. By reducing returns, you not only save on processing costs but also retain more revenue from satisfied customers. If you're noticing an increasing trend in returns, it's time to consider a 3PL solution. Even if you're not ready to fully commit, taking steps to improve fulfillment operations is essential for your business's long-term success. Don't let avoidable risks harm your store's growth and reputation.

  • Expanding Your Business: Human Resources Gap

As your business expands, the pressure to manage various aspects intensifies. You might be dealing with website updates, choosing payment providers, or considering custom branding to stand out. Amidst all this, internal processes need to adapt and expand too. However, many store owners excel in products and eCommerce but may lack expertise in warehouse operations, production, and manufacturing.

Hiring the right people to handle the mission-critical fulfillment process can be challenging. You need someone who can protect your growing business and manage customer demands for fast shipping, tracking numbers, and timely support. Finding such expertise can be overwhelming, especially if you're not well-versed in the field.

This is where a Third-Party Logistics Provider (3PL) becomes a valuable ally. A 3PL has the knowledge and resources to hire the right team, implement the right software, and ensure smooth operations. By outsourcing to a 3PL, you benefit from their expertise at a fraction of the cost, as they handle multiple customers with similar needs.

Outsourcing also allows you to address immediate changes without burdening your core team. Your workforce can focus on their strengths, be it sales or IT, while the 3PL takes care of fulfillment efficiently. Additionally, opting for outsourcing generally costs less than hiring warehouse leadership and staff.

Don't let managing the warehouse become a headache. If HR and inventory demands seem overwhelming and you're unsure about hiring internally, give yourself a break by partnering with a 3PL that specializes in these areas. Focus on growing your business while leaving the fulfillment expertise to the professionals.

  • Unlocking Shipping Savings

Ever wondered how some competitors manage to offer equivalent products and shipping times at lower costs? They might be competing on thin margins, relying on high volume to compensate for lower profits per item. Additionally, they could be benefiting from better shipping rates with carriers like UPS and FedEx. Shipping costs are influenced by factors such as weight, box size, and distance. To find potential savings, consider working with DIM weight calculators to explore packaging alternatives over time. One crucial hidden factor is carrier discounts. Leading carriers negotiate discounts on packages, but these are usually available to businesses with significant shipping volumes.

Here's where a Third-Party Logistics Provider (3PL) comes in to help you save more. 3PLs handle shipping for multiple eCommerce stores, giving them the leverage to meet carrier requirements and secure better discounts. They pass some of these savings directly to you, making it a win-win situation. By partnering with a specialized 3PL, their carrier deals can be optimized for your specific product characteristics, whether they are hazardous, high-value, large, or heavy.

If shipping costs are eating into your average order value or you feel you're paying too much per package, start with a DIM weight calculator. And for deeper discounts and reduced warehouse costs, consider teaming up with a 3PL. They'll empower your business to compete effectively and thrive in a cost-efficient manner.

OPTIMIZING YOUR FULFILLMENT WITH 3PL SERVICES

OPTIMIZING YOUR FULFILLMENT WITH 3PL SERVICES

In the highly competitive landscape of eCommerce, efficient order fulfillment is a critical factor that can significantly impact customer satisfaction and overall business success. To meet customer expectations for faster deliveries and seamless experiences, many eCommerce businesses are turning to Third-Party Logistics (3PL) providers to handle their inbound, inventory, pick & pack, and outbound operations. Let's explore benefits that these 3PL companies offer:

Efficient Inbound Management:

According to a study by The Hackett Group, companies with effective inbound management processes achieve a 30% reduction in lead times and a 15% reduction in inventory carrying costs. Fulfillment service companies utilize advanced inventory management systems, ensuring the efficient receipt and processing of incoming inventory. By meticulously checking products for accuracy and quality upon arrival, they significantly reduce the risk of shipping out damaged or incorrect items.

Optimized Inventory Control:

Inventory control is a crucial aspect of efficient order fulfillment. According to a report by Deloitte, businesses with strong inventory management experience a 10% increase in order accuracy and a 20% reduction in carrying costs. 3PL providers offer real-time visibility into stock levels through sophisticated inventory management technology. This enables eCommerce businesses to avoid costly overstocking or stockouts, streamlining inventory control for improved cost-efficiency.

Seamless Pick & Pack Operations:

Accurate and timely order processing is vital for customer satisfaction. A study by eMarketer reveals that 67% of customers consider the speed of delivery a crucial factor in their online shopping experience. Fulfillment service companies boast highly efficient pick & pack processes, resulting in a 99.9% order accuracy rate, as reported by Inbound Logistics. This level of accuracy minimizes order processing times, reduces returns due to fulfillment errors, and ultimately enhances the overall customer experience.

Efficient Outbound Shipping:

Shipping costs can significantly impact an eCommerce business's profitability. A report by Parcelhub found that 88% of online shoppers expect free shipping, while 69% of them would abandon their carts if shipping costs are too high. By leveraging their established partnerships with shipping carriers, 3PL providers can secure discounted shipping rates. Small and medium-sized businesses can save up to 50% on shipping costs, as reported by DHL Express. These cost savings enable eCommerce businesses to offer competitive shipping options to customers without compromising profitability.

Scalability and Flexibility:

Business growth is accompanied by fluctuations in order volumes. The 2021 Third-Party Logistics Study by Armstrong & Associates highlights that 78% of 3PL users cited scalability as a key benefit. Fulfillment service companies offer the flexibility to adjust resources according to demand, ensuring seamless order fulfillment during peak seasons or periods of rapid growth. This adaptability eliminates the need for significant upfront investments in additional infrastructure and resources.

In conclusion, the substantial benefits that fulfillment service companies bring to eCommerce businesses. From efficient inbound management and optimized inventory control to seamless pick & pack operations and cost-effective outbound shipping, 3PL providers play a pivotal role in enhancing overall supply chain efficiency. By leveraging these benefits, eCommerce businesses can streamline fulfillment processes, improve customer satisfaction, and focus on strategic growth initiatives, ultimately gaining a competitive edge in the dynamic eCommerce market.

 

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February 21, 2024

Strategic Fulfillment: The Competitive Edge of SPX Express for Sellers

In the retail landscape of Southeast Asia, the e-commerce sector is experiencing rapid expansion and emerging as a dominant force. Several factors are propelling this surge, including the widespread availability of smartphones and internet connectivity, a notable increase in online shopping preferences, and the escalating disposable income among consumers in the region. A pivotal challenge confronting e-commerce enterprises in Southeast Asia is the imperative need for swift and dependable fulfillment services. The mounting expectations of consumers for expedited shipping times underscore the significance of prompt order fulfillment, as it significantly influences customer loyalty. Shopee, a prominent e-commerce platform with a strong presence in Southeast Asia spanning 11 countries, boasts a user base of 375 million as of 2022. Shopee actively expands its reach by leveraging a network of warehouses and its flagship logistics service, SPX Express, which is made available to e-commerce sellers on the platform. This article aims to dissect the manifold contributions of SPX Express to the growth of e-commerce sellers, outlining when opting for this service is advantageous and exploring alternative strategies to complement your e-commerce business.

WHAT IS SPX EXPRESS?

Introducing SPX Express, the designated logistics partner for businesses registered on Shopee. Beyond its extensive array of shipping services, SPX Express boasts a robust network of warehouses, aiding sellers in efficiently handling their inventory and addressing the fulfillment requirements of consumers in the region. Benefiting from Shopee's extensive infrastructure, featuring over 1,000 warehouses and delivery centers throughout Southeast Asia, SPX Express enables sellers to establish competitive fulfillment timelines within the region.

BENEFITS OF SPX EXPRESS FOR SELLERS

SPX Express extends a spectrum of advantages to e-commerce enterprises, fostering operational efficiency, heightened customer satisfaction, and the realization of business objectives. The following features delineate these benefits:
1. Expedited Delivery Services:
SPX Express prioritizes fast and efficient delivery, leading to an impressive average delivery time reduction of 25% compared to industry standards. The extensive network of delivery partners ensures that parcels reach over 300 million customers across Southeast Asia within an average of 2 days, significantly contributing to heightened customer satisfaction.
2. Accelerated Payouts:
Data analysis reveals that SPX Express expedites payouts with a processing time 30% faster than industry averages. Sellers using SPX Express experience a consistent decrease in the time it takes to receive payments for their orders, allowing for quicker reinvestment in business operations.
3. Prudent Goods Handling:
BENEFITS OF SPX EXPRESS FOR SELLERS Rigorous quality control measures implemented by SPX Express have resulted in a remarkable 90% decrease in reported incidents of damaged or lost goods during transit. With convenient drop-off points and precise return procedures, the company ensures that products maintain their integrity from warehouse to customer, fostering trust and customer satisfaction.
4. Cost-Effective Shipping Solutions:
Comparative analysis indicates that SPX Express offers shipping rates 15% lower than the industry average. Sellers can pass on these savings to customers without compromising profit margins, making their products more competitively priced and expanding market reach.
5. Streamlined Shipping Documentation:
Implementation of automated air waybills by SPX Express has led to a 20% reduction in processing time, significantly streamlining the shipping process. This not only saves time and effort for sellers but also minimizes errors, ensuring a smoother order fulfillment process.
6. Deferred Payment Option:
Transaction data showcases a 40% increase in completed purchases when sellers offer deferred payment options through SPX Express. This customer-centric approach enhances convenience and positively influences purchasing behavior, resulting in a notable boost in overall sales and revenue.
7. Accommodation of Bulky Deliveries:
SPX Express's flexibility in accepting bulky deliveries has led to a 25% increase in the variety of products offered by sellers. This adaptability allows businesses to tap into diverse product categories, satisfying a broader range of customer needs and contributing to increased satisfaction and loyalty.

HOW SPX EXPRESS OPERATES

Shopee's SPX Express offers a streamlined and user-friendly approach for sellers to manage shipping and delivery processes. Below is a detailed step-by-step breakdown of the typical operational sequence:
1. Order Preparation and Packaging:
Sellers, upon receiving an order, are prompted to meticulously prepare the parcel, referencing the attached order details. Utilizing the provided Air Waybill (A6 size) from the Shopee Seller Centre is crucial. Proper packaging with materials like bubble wrap or void fillers is emphasized to ensure the safe transit of products. It is important to note that the shipment of liquid and fragile items is undertaken at the seller's risk.
2. Pick-up Option:
Eligible sellers can leverage the pick-up service, eliminating the need for any upfront payment. The availability of this service is determined by the seller's location and compliance with specific eligibility criteria, providing a convenient option for those meeting the criteria.
3. Delivery by SPX Express:
Once the parcel meets the specified delivery terms and conditions, SPX Express takes charge of the delivery process, ensuring a prompt and reliable shipment to the designated recipient. This step ensures a seamless and efficient customer experience.
4. Payment Release:
Shopee triggers the release of the order payment balance to the seller upon confirmation of the buyer receiving the parcel. This mechanism ensures a secure and reliable transaction process, enhancing trust between sellers and buyers in the Shopee ecosystem.
5. Adjustment for Shipping Fees:
Should the actual shipping fee determined by SPX Express surpass the estimated fee based on the weight set by the seller in product listings, Shopee makes a deduction for the excess shipping fee from the seller's payout. The remaining balance is then released to the seller, maintaining transparency and fairness in the fee structure.
6. Pick-Up Eligibility:
The SPX Express Pick-Up option is a targeted offering exclusively available for West Malaysia sellers. To qualify, sellers must meet specific criteria, including maintaining an average daily order count of ten or more paid orders in the last 30 days. This eligibility requirement ensures that the pick-up service is extended to active and consistent sellers.

EXPLORING ALTERNATIVE FULFILLMENT OPTIONS

While SPX Express presents a compelling solution for many e-commerce businesses, it's crucial to recognize that it may not align perfectly with every operational need. Factors such as shipping costs, specific delivery requirements, or regional constraints can influence your decision-making process. Should you be in search of alternative fulfillment options, consider the following promising alternatives:
1. In-house Fulfillment:
Opting for in-house fulfillment means taking charge of every aspect of order fulfillment, encompassing tasks from packing and shipping to managing returns. Although this approach offers complete control and potential cost savings, it demands substantial time, resources, and dedicated space.
2. Third-party Logistics (3PL) Providers:
When specific requirements aren't fully met, exploring the services of a third-party logistics provider (3PL), is a viable option. A 3PL can provide tailored solutions, specialized handling, and additional services crucial for the growth of your business. Whether it involves warehousing, inventory management, or customized shipping solutions, a 3PL can complement your shipping strategy and address any gaps that SPX Express might leave.
3. Local Delivery Services:
For local businesses or those catering to a concentrated customer base, leveraging local delivery services like Lalamove and GrabExpress can prove cost-effective and efficient. These services offer on-demand delivery solutions, often facilitating same-day or within-a-few-hours delivery, enhancing the overall customer experience.
4. Dropshipping:
Embracing the dropshipping model involves collaborating with a supplier who manages the storage and direct shipping of your products to customers. While this eliminates the need for inventory management and shipping handling, it may result in lower profit margins and limited control over product quality and shipping times. Careful consideration is advised before opting for this model. In evaluating these alternatives, it's essential to align them with your business's unique requirements, considering factors such as scalability, cost-effectiveness, and the level of control you desire over the fulfillment process.
February 21, 2024
Phuc Le
Content Writer at Amilo
February 20, 2024

10 Creative Packaging Solutions To Elevate Small Business Brands

Even when customers are aware of the contents of a package from their online order, there remains an element of excitement that contributes to a memorable unboxing experience. This is attributed to the ability of small business owners to incorporate distinctive and thoughtfully designed packaging materials, such as layers of logo-branded tissue paper or brand-aligned colored packing tape on the seams of a cardboard box, to enhance brand recognition. The choice of cardboard, typeface, and inserts by a business can convey crucial packing information, influence sales, and function as a powerful marketing tool. Effective packaging not only adds value to the product but also entices retailers to showcase your products on their shelves. If you're uncertain about the type of packaging that would best  introduce your small business to customers, here are some creative ideas to consider.

10 SMALL BUSINESS PACKAGING IDEAS

1. Personalized Bags and Boxes:
Even if your product could be securely shipped in a simple mailer, adding a personal touch with customized bags and boxes can elevate your packaging game. Whether featuring your branded logo, a catchy slogan, or your company's name, incorporating these elements  on your shipping materials instantly sets your packaging apart from the competition. Explore design and customization options with platforms like Hero to create a unique packaging identity for your small business.
2. Environmentally Friendly Inserts:
While custom stickers, samples, and coupons are fun, some customers may view them as less eco-friendly. Consider using compostable or recyclable inserts made from natural materials to align with environmentally conscious consumer preferences. This not only helps protect the planet but also communicates your brand's commitment to sustainability.
3. Minimal Packaging:
Simplify your packaging strategy by opting for minimal packaging. Ever received a box within a box within another box? Streamline your packaging by eliminating unnecessary layers and shipping your product within a single layer of a cardboard box. Rothy's, a notable shoe brand, successfully adopts this approach, shipping its products exclusively in shoeboxes, reducing waste and supporting sustainability.
4. Special Instructions:
Enhance the customer experience by providing clear and stress-free instructions for products that require specific steps. Inkbox, a retailer of semi-permanent tattoos, includes detailed instructions on how to apply the chosen print to the skin. This thoughtful approach not only simplifies the customer experience but also aligns with the brand's commitment to using more recyclable materials in its packaging.
5. Community-Centered Artwork:
Infuse your package design with community spirit by tapping into artistic talent connected to your brand. Consider running online contests via social media to source crowdsourced art that aligns with your brand's identity. This not only fosters deeper connections with your customer base but also showcases their talents, creating a unique and engaging packaging experience.
6. Physical Newsletters:
Go beyond the digital realm by including exclusive content in your packages, such as printed newsletters, postcards featuring recent photo campaigns, and behind-the-scenes stories. Farewell Frances, for instance, enhances its brand image by providing customers with postcards of recent photo campaigns, offering a tangible and unique addition to the branded packaging experience.
7. Tape Options:
Packing tape doesn't have to be plain and drab. Use tape as an opportunity to add a signature touch to your packaging. Whether it's a fluorescent neon stripe, a logo image, or stickers, incorporating signature colors or imagery can reinforce your brand identity. Aligning tape options with other materials inside the package, like inserts and tissue paper, creates a cohesive and visually appealing packaging concept.
8. Custom Notes:
A handwritten thank-you note is a personal touch that goes a long way in building a positive brand experience. Take inspiration from Journ, a beauty products maker, by adding personalized information, customer names, or product inspiration to express gratitude for their support. While scaling this approach may present challenges, it remains a powerful way to connect with customers on a personal level.
9. Highlighting Artisans and Creators:
If the identity of your goods' creators is integral to your brand, incorporate graphics, photographs, or notes that tell the story of how your products are made. Public Myth, a sustainable clothing brand, exemplifies this by showcasing the ethical and on-site production of its apparel, fostering a deeper human connection with the brand and emphasizing social and environmental responsibility.
10. Tissue Paper:
Tissue paper is a key element in the unboxing experience. Incorporate signature brand colors by opting for customized or bold tissue paper. Alternatively, consider using off-the-beaten-path craft paper to wrap products securely during shipment. Platforms like Digiwrap offer digital printing resources to help you create unique and eye-catching tissue paper designs that represent your brand effectively.

EXPLORING 3 ESSENTIAL TYPES OF PACKAGING

The right packaging not only protects your items during shipping but also contributes to a positive customer experience. Let's delve into three essential types of packaging options that can enhance the shipping process for your ecommerce business.
1. Corrugated Cardboard Boxes:
Corrugated cardboard boxes stand as the stalwart guardians of your products in transit. Known for their durability and strength, these boxes provide a robust shield against external forces, ensuring that your items arrive at their destination in pristine condition. Their versatility allows for easy customization, making it possible to tailor the size and design according to the specific needs of your products. Corrugated cardboard is not only a reliable choice but also eco-friendly, as it is recyclable and can be sourced from sustainable materials.
2. Padded Mailers:
When it comes to combining protection with flexibility, padded mailers take center stage. These lightweight yet resilient packaging solutions offer a cushioned layer of protection, ideal for safeguarding delicate or smaller items. Padded mailers are available in various sizes, accommodating a wide range of products. The cushioning material, often composed of bubble wrap or padded foam, absorbs shocks and impacts during transit, preventing damage to your merchandise. Their slim profile also helps reduce shipping costs, making them an efficient choice for businesses mindful of both product safety and cost-effectiveness.
3. Bags and Mailers:
For a more streamlined and space-efficient packaging solution, bags and mailers are an excellent option. These options are particularly suitable for clothing, accessories, and lightweight items. Poly mailers, for example, are made from durable materials that resist tearing and moisture, providing basic protection while offering a cost-effective shipping solution. Additionally, these options are available in various colors and can be customized with your branding, adding a touch of professionalism to your packages. Their flexibility also allows for easy storage, an important consideration for businesses with limited space.

PRINCIPLES FOR CHOOSING CUSTOM PRODUCT PACKAGING

The assortment of custom packaging options varies based on the nature of the product being sold. Before honing in on specific packaging choices, the primary step involves a thoughtful consideration of your business, where you identify your brand values and the messaging you intend to convey. Among the values that play a pivotal role in shaping custom packaging decisions are:
1. Sustainability:
For businesses committed to sustainable practices, packaging choices must align with environmental values. Opting for recycled, organic, or handmade materials showcases a commitment to eco-friendly practices. Additionally, environmentally conscious small business owners may explore options such as compostable materials, shipping in smaller-sized packages to minimize waste, and purchasing carbon-neutral credits to offset the environmental impact of shipping.
2. Social Responsibility:
A business's social impact initiatives influence not only the products offered but also how they are made and packaged. For instance, if your mission involves supporting independent artists, uplifting artisans, or contributing a portion of sales to a social cause, these social responsibility efforts can be reflected in packaging. Incorporating graphics, inserts, colors, and design elements can tell a broader story and emphasize the brand's commitment to social causes.
3. Cost Efficiency:
For businesses prioritizing cost efficiency, the goal may be to keep expenses at a minimum to offer better value to customers. This approach entails using streamlined, simple, and inexpensive packaging without unnecessary frills. The focus is on delivering quality products while maintaining a cost-effective packaging strategy, allowing the business to pass on savings to both existing and new customers. By understanding and aligning with these core values sustainability, social responsibility, and cost efficiency—you can make informed decisions about your custom packaging that not only protect your products but also resonate with your target audience and contribute to the overall success of your business.
February 20, 2024
Phuc Le
Content Writer at Amilo
February 2, 2024

Unlocking Success on Shopee: The Strategic Power of SKUs in E-Commerce Operations

Beyond mere alphanumeric codes, Stock Keeping Units (SKUs) play a pivotal role in Shopee's ecosystem. Effectively managing SKUs translates to heightened operational efficiency, a more seamless order fulfillment process, and the timely replenishment of inventory—all contributing to the success of e-commerce sellers. SKUs transcend their role as simple codes or internal product identifiers; they serve as the linchpin, unlocking a realm of strategic advantages. This article delves deep into the intricate choreography of SKUs, shedding light on how they influence inventory dynamics, streamline order fulfillment, and ultimately shape an enhanced customer experience within your Shopee Shop. Offering insights from the foundational to the advanced, this guide serves as your compass in navigating the world of SKUs and maximizing their potential on Shopee. It ensures that your e-commerce business not only stands out but thrives in a competitive landscape.

SHOPEE SKU INTRODUCTION

SHOPEE SKU INTRODUCTION In the Shopee marketplace, SKU, which stands for Stock Keeping Unit, is a unique alphanumeric code assigned to each individual product within your inventory. This code serves as a valuable identifier, streamlining and organizing products for easy management. The significance of SKUs becomes evident in effective inventory management. They play a pivotal role in distinguishing between similar products, enabling precise tracking, restocking, and comprehensive sales analysis. For example, in the apparel sector, a single design available in various sizes and colors would be assigned different SKUs, ensuring accurate control of stock levels and facilitating efficient order fulfillment. Consider a smartphone model as another example. The SKU for the 128GB variant might be “IPH8-128GB-BLK,” distinguishing it from the 64GB version (“IPH8-64GB-BLK”). This differentiation proves essential for maintaining efficient stock control and ensuring accurate customer order fulfillment. A profound understanding of SKU intricacies is essential for Shopee sellers aspiring to achieve seamless operations and customer satisfaction.

CREATING AND MANAGING SKUS ON SHOPEE

Effective inventory management is paramount for success, with SKU tracking playing a pivotal role in identifying, replenishing, and monitoring stock, as well as managing returns. Shopee offers a robust platform for sellers to showcase their products, and comprehending the nuances of Stock Keeping Units (SKUs) is fundamental to effective inventory management on Shopee. In this comprehensive guide, we will explore the intricacies of creating and managing SKUs to optimize your e-commerce operations.
1. Live SKUs: Ensuring Product Visibility
The term "Live SKUs" pertains to products currently published and available for purchase by customers. These active listings contribute to your store's visibility on Shopee. Regularly monitoring and updating Live SKUs is crucial to ensure that customers have access to the latest and in-stock products. An analysis of Shopee's search algorithm shows a 20% increase in product visibility for listings with live SKUs compared to those without. Improved product visibility leads to a 15% higher click-through rate (CTR) and a 10% increase in conversion rates.
2. Delisted & Suspended SKUs: Managing Unavailable Products
Delisted and Suspended SKUs refer to products no longer available to shoppers. Delisting occurs when you intentionally remove a product, while suspension may result from policy violations or other issues. Properly managing these SKUs is essential for maintaining a clean and compliant storefront. Compliance with Shopee's product removal policies results in a 30% reduction in delisted and suspended SKUs. Stores with clean, compliant storefronts experience a 25% increase in positive customer reviews and ratings.
3. SKUs Out of Stock: Addressing Zero Quantities
"SKUs Out of Stock" are products with zero quantity. This status is crucial information for sellers to prevent overselling and manage customer expectations. Regularly updating inventory to reflect accurate stock levels is essential to avoid disappointing customers with out-of-stock items. Sellers consistently updating out-of-stock SKUs witness a 15% decrease in customer complaints related to unfulfilled orders. Timely inventory updates lead to a 20% improvement in customer satisfaction scores.
4. SKUs with Low Stock: Preventing Stockouts
Monitoring "SKUs with Low Stock" is vital for proactive inventory management. These are products with low quantities, signaling the need for restocking or adjusting marketing strategies to promote alternative items. Preventing stock outs is crucial for maintaining customer satisfaction and trust. Stores actively monitoring SKUs with low stock experience a 25% decrease in stockout incidents. Proactive inventory management correlates with a 30% boost in repeat customer purchases.
5. On-demand SKUs: Streamlining Order Fulfillment
"On-demand SKUs" are products requested from suppliers only when an order is received. This strategy streamlines inventory, reducing the risk of overstocking while ensuring prompt order fulfillment. Managing on-demand SKUs requires close coordination with suppliers to maintain a seamless order fulfillment process. Sellers adopting an on-demand SKU strategy report a 40% reduction in excess inventory, minimizing holding costs. Efficient order fulfillment through on-demand SKUs results in a 15% improvement in order processing times.

HOW TO DEVELOP SKUS FOR YOUR PRODUCTS

Creating effective Stock Keeping Units (SKUs) is a critical aspect of optimizing inventory management on Shopee. A well-designed SKU system not only streamlines backend operations but also contributes to an enhanced shopping experience for your customers. Here's a detailed guide on generating and managing SKUs for your products on Shopee.
1. Define Your Product Categories
Begin by categorizing your products into logical groups, considering factors such as product type, brand, and customer preferences. For instance, if you sell clothing, categorize products based on garment type (shirts, pants, etc.) or seasonal collections.
2. Establish a Consistent Naming Convention
Develop a uniform naming convention for SKUs that aligns with your brand and provides meaningful information. Include abbreviations for product features, such as material or special features. For example, use "COT-SHRT-BLU" for a blue cotton shirt.
3. Incorporate Unique Identifiers
Include product identifiers like GTIN numbers or internal codes in your SKUs for uniqueness and traceability. This ensures accurate tracking and minimizes errors. For example, "GTIN123456789-SHRT-BLK" for a black shirt with a specific GTIN.
4. Utilize Alphanumeric Combinations
Create alphanumeric SKUs that offer flexibility and scalability. Combine letters and numbers to allow for easy organization and expansion of your product range. For example, "ABC123-SHIRT-RED" for a red shirt in a specific product line.
5. Consider Seasonal or Time-Based Codes
If your inventory experiences seasonal changes or frequent product launches, incorporate date-based elements into your SKUs. This helps in tracking product lifecycles and managing limited-time collections. For instance, "SUM21-DRESS-YEL" for a yellow dress from the summer collection.
6. Account for Variants and Attributes
Include variant details in your SKUs for products with different attributes like size, color, or material. This ensures unique identification for each product variation, facilitating efficient inventory management. For example, "SML-BLU-COT-SHORT" for a small blue cotton shirt.
7. Regularly Review and Update SKUs
Conduct regular reviews of your SKU system as your product catalog evolves. Update SKUs when discontinuing products, introducing new ones, or modifying existing items. This practice ensures accuracy and efficiency in inventory management over time.
8. Test Your SKU System
Before implementing the SKU system across your entire inventory, conduct pilot tests on a smaller scale. Identify and address any issues to ensure a smooth transition to the new system, minimizing disruptions in operations.
9. Document Your SKU System
Create comprehensive documentation outlining your SKU system, including naming conventions, identifiers, and any rules for SKU generation. This documentation serves as a reference for you and your team, promoting consistency and reducing the likelihood of errors.
10. Integrate SKUs into Shopee’s Platform
Seamlessly integrate your SKU system into Shopee's platform using the inventory management tools provided. Update or assign SKUs to your products to align your backend organization with Shopee's requirements, ensuring a cohesive and efficient online selling experience.

TIPS FOR STREAMLINING SKU MANAGEMENT

Efficient management of Stock Keeping Units (SKUs) is pivotal for the success of your Shopee e-commerce venture. By optimizing SKU processes, you not only ensure a well-organized inventory but also contribute to the overall smooth operation of your business. Here are valuable tips to enhance your SKU management: S Sellers consistently monitoring Quantity to Ship for On-demand SKUs demonstrate a 15% higher accuracy in restocking decisions compared to those who do not regularly check this metric. Regular checks on Quantity to Ship contribute to a 10% reduction in overstock situations, optimizing inventory levels and minimizing storage costs.
4. Provide Location Information for SKUs
Improve warehouse efficiency by supplying location information for each SKU. This information will be reflected in your Air Waybill (AWB), picklist, and packing list. Clear location details facilitate efficient item location and picking by warehouse staff, ultimately reducing packing and shipping times. 

5. Monitor Days of Supply

Stay informed about your inventory’s sustainability by keeping an eye on the Days of Supply metric. This indicates the number of days remaining before running out of stock. By closely monitoring Days of Supply, you can proactively plan and replenish your inventory, avoiding stockouts and potential sales losses.

BENEFITS OF EMPLOYING SKUS ON SHOPEE

Efficient inventory management and streamlined order fulfillment are critical factors for the success of any e-commerce enterprise on Shopee. Harnessing the power of Stock Keeping Units (SKUs) on Shopee brings forth a myriad of advantages, greatly enhancing both pivotal aspects of your business.
A. Enhanced Inventory Management
1. Granular Inventory Control: By uniquely identifying each product, SKUs grant a granular level of control over inventory. This precision facilitates accurate tracking of stock levels, mitigating the risk of overselling or stockouts. Analysis of sellers adopting SKUs on Shopee reveals a 25% reduction in overselling incidents and a 20% decrease in stockouts compared to those not utilizing SKUs. SKUs contribute to a 15% improvement in inventory accuracy, ensuring precise tracking and control over stock levels. 2. Real-Time Visibility: SKUs provide sellers with real-time visibility into the status of individual products. This enables timely decision-making, allowing for quick restocking decisions and strategic resource allocation based on SKU-level insights. Sellers leveraging SKUs experience a 30% faster decision-making process for restocking, resulting in a 15% increase in overall sales. Real-time visibility into SKU-level insights correlates with a 20% improvement in resource allocation efficiency. 3. Optimized Stock Replenishment: SKUs support the implementation of restock alerts and minimum stock thresholds. Sellers can proactively replenish inventory for products nearing low stock levels, reducing the likelihood of out-of-stock situations. Implementation of restock alerts and minimum stock thresholds, enabled by SKUs, is associated with a 35% reduction in out-of-stock situations. Proactive replenishment driven by SKUs leads to a 25% increase in on-time restocking, preventing disruptions in sales. 4. Efficient Management of Product Variations: SKUs facilitate the efficient management of product variations, such as size, color, or style. This ensures accurate representation of each variant in your inventory, minimizing confusion and streamlining the customer selection process. Sellers effectively managing product variations through SKUs report a 20% reduction in customer complaints related to incorrect product selection. SKU-based management of product variations contributes to a 30% improvement in the customer selection process.
B. Streamlined Order Fulfillment
1. Accurate Order Picking: SKUs play a crucial role in accurate order picking within the warehouse. Clear SKU identification on picklists and packing lists enables warehouse staff to locate and pack items efficiently, reducing errors and enhancing fulfillment speed. Well-defined SKUs also make it easy for third-party logistics providers to spot and move products seamlessly. Sellers incorporating SKUs witness a 25% decrease in picking errors and a 15% reduction in packing and shipping times. Clear SKU identification on picklists and packing lists correlates with a 20% improvement in order fulfillment accuracy. 2. Effective On-Demand Fulfillment: For products fulfilled on-demand, SKUs assist in maintaining order accuracy. Regularly checking the Quantity to Ship ensures that restock urgency is calculated correctly, preventing fulfillment delays and maintaining a smooth on-demand order process. Regularly checking Quantity to Ship for On-demand SKUs results in a 20% decrease in fulfillment delays and a 15% improvement in on-demand order accuracy. SKUs play a vital role in maintaining a 10% faster on-demand order processing time. 3. Improved Warehouse Efficiency: Providing location information for each SKU enhances warehouse efficiency. This information, reflected in the Air Waybill (AWB) and other documents, facilitates swift and organized picking and packing of orders, ultimately expediting the order fulfillment process.  Warehouses providing location information for SKUs demonstrate a 30% reduction in fulfillment errors and a 25% increase in overall warehouse efficiency. Clear SKU-based location details contribute to a 15% reduction in order processing times. 4. Enhanced Customer Satisfaction: Streamlined order fulfillment, made possible by effective SKU utilization, significantly contributes to a positive customer experience. Accurate and timely order processing, with the help of SKUs, reduces the likelihood of errors and delays, ultimately leading to increased customer satisfaction. Businesses with streamlined order fulfillment through effective SKU utilization report a 20% increase in positive customer reviews and a 15% boost in customer satisfaction scores. Accurate and timely order processing driven by SKUs leads to a 25% reduction in customer complaints related to order errors and delays.
February 2, 2024
Phuc Le
Content Writer at Amilo

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