iStock.com/StockRocket
The warehousing and fulfillment industry has never been more popular. Thanks to the exponential growth of e-commerce sales, there is more interest and opportunity in fulfillment services than ever before. But the growth of e-commerce fulfillment is more than an increasing interest—the industry has been taken to new heights because of a new method of doing business known as on-demand warehousing and fulfillment. Over the last few years, on-demand warehousing has been one of the major goals of online retailers to achieve success and get ahead of their competitors. What is on-demand warehousing and fulfillment? Keep reading to find out.
What Is On-Demand Warehousing and Fulfillment
On-demand warehousing is an online marketplace of warehousing services where users can access the network and use space on an “as needed” basis. Providers of warehouse space can offer extra space to other companies as it becomes available. In theory, it connects anyone with additional warehouse space, no matter what kind of warehousing system them have in place, to someone who needs it for a time. A company can gain access of excess warehouse space to be used for short- or long-term projects, which helps them save money and have greater flexibility and convenience. On-demand warehousing can be compared to services like Airbnb or Uber, which work like an exchange of services available in real-time.
On-demand platforms allow companies to list their available space and lend it to those who need it temporarily. Each transaction is run through the platform, from listing and gaining access to warehouse space, to managing inventory and shipping orders. The platforms also bill the customer for services rendered and the customer can then pay the warehouse operator.
Companies that use on-demand warehousing are focused on more than the exchange of temporary or additional warehouse space. They also attempt to exchange more complex services. The platform allows companies with extra space to earn money by storing inventory, and picking packing, and shipping orders for their business customers.
Advantages
The genesis of on-demand warehousing was to resolve the issue of the ever-growing need for warehouse space. In the past, businesses that required extra space would need to find a warehouse to lease, or pay a 3PL warehouse for its space. Now, on-demand warehousing resolves the issue of being tied to a lease. Companies generally need more warehouse space because of the seasonal changes of their inventory demands, product promotions, bulk buying, same/next day shipping demands, new products, end of year challenges, product recalls, and more. On-demand warehousing answers the need for more warehouse space, and extends its benefits to the fulfillment process. Companies that use this model have upgraded from tracking pallet shipments to facilitating the exchange of order fulfillment. Users of on-demand fulfillment can have someone else ship orders for them. This is a huge advantage for small and growing retailers, who are now able to compete against larger companies who have their own warehouse space.
Disadvantages
As convenient and useful as on-demand warehousing is, not anyone can provide this service. Not every business with additional warehouse space can offer this service—if the standards were this low, business customers who used these additional spaces could face serious risks with the handling of their products. There are some big obstacles that make on-demand fulfillment a challenge.
First, any company offering this service must have significant available labor on-hand for the fulfillment and shipping aspects to meet expectations. They will need to dedicate some of their staff and technologies to managing your business. Prioritizing these responsibilities is the second, related issue. A third-party logistics provider (3PL) must serve all of its own customers as well as manage the tasks you require for your on-demand warehousing partnership. 3PL providers that do not have technologies and staff designated to supporting your business, and their own, will ultimately lead to mistakes and problems.
Outsource to Our Experienced On-Demand 3PL Services
On-demand warehousing fulfills short-term needs and is flexible. This flexibility allows your business to save money, scale fulfilment services to accommodate growth, and eliminate the need to have your own warehouse or fulfillment system. The convenience of on-demand warehousing benefits the external business with seasonal space, and it benefits the original company too. The company providing the space has the benefit of receiving their space back for use during peak seasons when they need it.
Third-party e-commerce fulfillment companies provide incredible opportunities for businesses to improve their customer experience and loyalty and run a more flexible and efficient supply chain. Although there are challenges with the on-demand system, some companies have resolved those issues by hiring enough staff and implementing prioritization measures to ensure the most important aspects are handled first. A 3PL provider will ensure your products are organized, managed, stocked, and distributed on time, and will give you the space you need, when you need it.
APS Fulfillment, Inc. strives to be the best on-demand warehousing and fulfillment provider to our clients by offering dependable and effective e-commerce fulfillment services. If you need help managing your e-commerce processes or believe it is time to upgrade your system, we can help. We offer a variety of hands-on services including product fulfillment, direct mail marketing, fulfillment solutions, and more. We also use the best quality software systems to manage your warehouse, so if you’re looking for the right company, look no further than APS Fulfillment, Inc. You can contact us by e-mail at [email protected] or by phone at (954) 582-7450.
