Fulfillment Challenges for Small Businesses
It is difficult for someone to start and maintain a small business, as the overwhelming majority of them will fail within the first 3-5 years of being in existence. For the few that manage to break from the herd and become profitable, the problems do not end.
There are numerous issues that need to be dealt with on a daily basis, and that isn’t accounting for the fact that even more problems arise as companies scale. Strategies need to be changed, and a grander perspective on the livelihood of the business needs to be adapted.
One of the biggest problems that small businesses face today is order fulfillment. Larger businesses that have the capital and necessary resources can solve this problem with automation and international connections that will allow for speedy and accurate delivery. While there might be the occasional error or two, the process is seamless.
Small businesses lack the resources necessary to carry on full-scale automation and, thus, require a process that involves re-entering data multiple times and coordinating with several carriers to ensure that orders are on track to be delivered on time. Yes, that also means using human labor to package products properly for shipment. This leads to inefficiencies and errors that could potentially compromise the future of the business.
While larger businesses can get away with a few customer complaints, small businesses find themselves at the mercy of the angry customer that writes a scalding yet convincing review about them for the world to see.
Fortunately for small businesses, there are only a few fundamental fulfillment challenges that have the greatest negative impact on their survival and prosperity. This means that if these challenges were to be addressed and solved, they would find that fulfilling orders is no longer the weak link holding the business back from greater growth.
Here are some of the common challenges that small businesses face, along with proposals on how they can be fixed and real examples of companies that have managed to overcome these issues.
Treating the Fulfillment Process as Individual Parts and Not as a Whole
Source: shutterstock.com ChristianChan
When small businesses try to treat problems related to fulfillment orders, their gut instinct is to zero in on a specific aspect of the process and attempt to fix that. This is a rookie mistake that leads to negligible gains in order accuracy or the number of orders successfully shipped.
The counterintuitive way to approach this would be to look at it from a 30,000-foot perspective. In other words, you need to start at the very beginning of the order and work your way to the very end. Treat your fulfillment order process as a system instead of looking at a single cog in the machine.
Publishing company Random House encountered this same issue when they were trying to solve the problem of losing money on sales due to supply chain management that resulted in copies of books being sold out when consumer demand was high for particular items. After they refined the process as a whole, through an extensive data review, they figured out they could improve fulfillment by redefining their replenishment times.
Automate, Test, and Refine One Thing at a Time
With a bird’ eye view of your order fulfillment process, you can now laser in toward making the changes that will produce the biggest results. As a small business, you have the time and the luxury of testing and refining every part of your fulfillment operations until you find the right balance in which you can handle the highest amount of demand without sacrificing order accuracy or speed of delivery.
If you are a marketer, you can think of this as a form of A/B testing, where you improve one thing at a time to make sure that the one change was the sole cause of different outcomes. Nike is a great example to show the power of this concept in action because they demonstrated what you should NOT do.
They had a massive failure with implementing their supply chain software because it was not tested thoroughly in advance, leading to $100 million total in lost sales. They tried to do too much in too short of a timespan. This concept of fixing only one thing at a time seems slow, in the short term, but, in the long term, you end up improving your process much faster.
Streamlining the Order Capture and Tracking Process
As a small business in the 21st century, there is no reason for you to be manually handling orders and tracking their delivery status. Furthermore, you should avoid having to re-key data multiple times into different databases. This leads to lower-order accuracy and angry customers who are not receiving an accurate status update regarding their order, or, even worse, receiving something that they did not order in the first place.
Think about it this way: A mere 1% error for a company that ships 100 units on a daily basis can result in up to 350 orders that have been misplaced. If just 10% of those missed orders result in negative reviews on the internet, your company is in big trouble!
You need to automate your order capturing process, to ensure 100% accuracy, and use a single-window business suite you can use to go easily back and forth between multiple orders and track their status for any delays or errors that should be reported to customers (and your staff) right away.
Source: shutterstock.com Olivier Le Moal
Look no further than Amazon to see a prime-time example of automation in action.
Virtually everything is streamlined, from the order capturing process to the advanced robotic technology that is used to move products around in the storage warehouse. The point of presenting Amazon is not to convince you that having more robots is the answer. Rather, it is to demonstrate with each part of the process you can successfully automate, without compromising anything else, your order fulfillment challenges begin to disappear one by one.
Small businesses will inevitably face fulfillment challenges when they start off, due to the adaptation that needs to be made in delivering products to a larger customer base. The key to overcoming these challenges successfully is to realize that they are merely temporary obstacles that can be overcome with time and proper planning.