fullfillment / CS / Finance and administration / HRM
what is fulfillment
Fulfillment is the delivery process used to move a product from its point of sale
to the hands of the customer.
Fulfillment also refers to the way that a firm responds to its customers and the
steps they take to ensure that sold products are delivered to the consumers
correctly within the tightest time frames.
Impact of E-Commerce on:
1. Marketing
o Product promotion: Electronic commerce enhances promotions of
products and services through direct, information-rich and interacting
contact with customers.
o Direct saving: The cost of delivering information to customers over the
internet results in substantial savings to senders.
o Customer Service: Customer service can be greatly enhanced by enabling
customers to find detailed information online.
o Brand Image: Newcomers can establish brand or corporate images very
quickly through net and affordable cost.
o Advertising: Traditional advertising used mass or direct – one way –
communication to persuade customers to buy their products and services.
In the electronic period, it is interacting communication – two way- aims at
customers to browse, explore, compare, question and even customer
design the product configuration.
o Customization: The ultimate luxury can get is in terms of custom designed
products and services. The net offers a tremendous opportunity to
understand customers needs one at a time and offer customized products
and services.
o Order making process: Taking orders from customers can drastically be
improved if it is done electronically, this saves time and reduces expenses,
so sales people have more time to sell their products or services.
o Intermediaries: In traditional marketing middlemen are supposed to
provide pace and time utilities to the ultimate customer, but advancement
of information technology is turning intermediation in to
disintermediation.
o Customer Value: Traditional marketing tries to maximize the value per
transactions; here customer attraction is big target. But in electronic
marketing, the marketers are trying to form relationship with customers
and they are looking for long term value maximization.
2. Facilities.
A key competitive advantage that ecommerce businesses have over brick-and-
mortar stores is not having to invest in physical facilities. In many cases, you can
run your business out of a home office, basement, or garage. If you drop ship or
outsource fulfillment, you may be able to do that for a long period of time. Even
with many employees, you can simply set up your offices in class B or C space, as
you have no need for a fancy store, or a store being located in a high-traffic
location.
A word of advice is to keep your options flexible. Try to find an office park with a
variety of spaces of different sizes. You may be able to start in a smaller space
and move up to a larger one (without penalty), as your needs change.
A key competitive advantage that ecommerce businesses have over brick-and-
mortar stores is not having to invest in physical facilities.
3. Customer service.
There are many choices today for delivering high-quality customer service. You
can manage those activities in-house or outsource to a third party. Basic
customer service for sales and post-sales activities can be handled by using email
and, for more extensive needs, phone support. A customer-management system
will make those activities easier, but for smaller companies, it is not a
requirement.
Live chat will impact your operations — someone needs to be available during
specified hours to response. Be sure to gauge the impact of that on your
organization, if you decide to handle those activities in-house.
4. Information technology.
Choosing an ecommerce platform is one of the most important decisions you will
make in your business. Do you want to build and host your own system,
outsource the development and then manage the system going forward, or use a
3rd service platform?
If you apply IT, you may need more cash upfront and skilled administrators and
developers on your staff. By using a SaaS platform, you will not need to host or
manage the system in-house, but you may still need web developers on staff.
Choosing to outsource the development and hosting will reduce your staffing
costs, but you, also it will incur higher costs for any future enhancements or
changes to your websites.
There are pros and cons to any approach. Think through the impacts on your
staffing, cash flow. Making sure to have carefully consideration before you move
forward.
5. Fulfillment.
Another key decision is whether you will manage your own inventory or
outsource those activities to a fulfillment house or through drop shipping
arrangements with your suppliers.
Managing your own inventory will provide a high level of control, but you will tie
up cash in warehouse space and fulfillment staff. In some industries — such as
the jewelry supply industry that my previous business was in — managing your
own inventory was the most logical choice. We had no alternative for drop
shipping, and most items were purchased in bulk and were very small. We did
not trust preparation and fulfillment to an outside service.
Select the best fulfillment option to meet your needs. Be sure to understand the
costs involved and analyze the other options before moving forward.
With the impact of E-commerce, full-service fulfillment companies offer up an
end-to-end solution: They take your products from warehouse shelves, pack
them, hand them to shippers and then send an automated e-mail response to
your customers to let them know their packages are in transit.
They can also handle credit-card processing, supply current inventory levels to
website, reorder products, send notices of shipping and handle returns.
6. Finance and administration.
You can manage your finance and administration activities in-house or
outsource them, or use a hybrid of the two. If your ecommerce platform is tightly
integrated into your accounting system, you may have very little need for an in-
house accountant (bookkeeper). If you use separate systems for your website,
order management, and accounting, you may need more help for data entry and
making sure that the information is properly managed.
Meanwhile, many ecommerce companies use outside services for vendor
payments, payroll, and other basic accounting activities. They decide to focus on
the sales, marketing, and customer service. This allows them to maintain a focus
on growing their businesses, instead of paying an internal accountant — or doing
that work yourself as the business owner.
On the administration side, you need a leadership team. Good communication is
important, whether you have three or 100 employees. Be authoritative or
democratic in your management style — it is up to you. But choose a style and
stay consistent. Be sure that everyone understands their roles, as well as the
overall business strategies by having a strong and stable communication system
or platform. You may need to adjust your approach as your business evolves.
7. Human Resources.
Many small-business owners avoid the human resources function. Recruiting,
setting up compensation, maintaining compliance, and other HR activities are
specialized and time-consuming. You may choose to bring the resources in-
house. But, should you outsource, there are many individuals and agencies well
equipped to do the job.
E-commerce platforms have also directly affected recruitment agencies by
allowing them to recruit candidates online via their websites. Although this type
of platform does not strictly fall into the realm of e-commerce, it works on the
same principle and is, therefore,is affected by changes and development in e-
commerce platforms.
E-commerce platforms also require people to manage them, as some tasks cannot
be fully automated and requires a bit of human help. As a result, the demand for
back-end administrators is also rising.
