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Ways To Reduce Order Fulfilment Costs

Among all the costs and requirements that warehouses can encounter, order fulfilment is one of the most common—and can run out of control if not kept in check.

Especially in these times of daily online shopping and constant demands for improved shipping times, it feels like a lot of the expense for shipping and fulfilling orders is on the seller. While a lot of this is just part of doing business these days, there are many things your warehouse can do to better manage shipping costs and keep things under control while you pass the savings onto your customers. Here’s four easy ways we’ve found to manage the cost of order fulfilment and keep things rolling smoothly:

Audit Existing Costs

Any major business change should first be accompanied by a careful examination of your current standing and what effect the changes might have, and order fulfilment costs are no exception. There’s a few different ways to measure these metrics (and all of them require more maths than we’re prepared to explain) but in general you need to take a look at how much it costs to store these goods, how much it costs to pick and store these goods, and what your total monthly costs are for storing items and work from there.

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Cut Packing Expenses

Packaging materials are one of the areas in shipping where expenses can pile up the fastest. While splurging on top-shelf packing goods might sound like a good bit of customer service, it can actually start to drive up expenses and cause bigger issues for your bottom line. Identify the areas where you can cut back on cost of materials without sacrificing product safety. A good rule of thumb is to cut back on the materials used inside the package without skimping too much on the outside, as that’s the area that will be absorbing the most punishment in transit.

Optimise Inventory Management

While a lot of focus is put on the actual packaging of your shipments, as well as the costs associated with mailing them, the actual labour costs associated with storing and retrieving these items is a major factor as well. Shorter shipping times and reduced shipping costs means these items need to be stored correctly and retrieved quickly to cut down on handling times, which can further benefit your ability to ship items quickly. Make sure to carefully arrange your industrial shelves and pallet racks to store items in a way that makes them easily retrievable and safe to handle, and label everything as needed. Consider “kitting” items together if they’re commonly purchased as a bundle to further reduce handling time.

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Get in Touch with Advanced Handling & Storage

If you want to find our more about how second hand pallet racking, shelving or any other storage system can benefit your business, then please get in touch with our team on 0800 345 7088 or send an email to [email protected]

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