Depending on your position, drop shipping means different things to different people. Even with the growing popularity of the method and its unique alignment with e-commerce, the risks of drop shipping are significant.
For that reason, it can be tough to tell whether the risks are worth taking on for your business. Will drop shipping be the key to growing a brand and building a base of customers? Or will it lead to unreliable order fulfillment and a reputation for failure?
Without careful consideration for your transportation and shipping needs, things can quickly go wrong. This applies to brands as well as service providers, both of which perspectives we’ll explore in this article.
Our recurring “Unpacking” series digs into the deeper meaning of commonly used terms and trends in the supply chain world that prompt a lot of questions. You can read all of the previous entries here.
Fulfilling orders can be smooth execution or hard duty. Which you end up with for your business lies in direct proportion to the software and people you bring together to perform the service. Both play a key role, but one may prompt more work than the other, depending on the technology you put to work.
Today we’ll focus on the order fulfillment technology that brings the best out of your team and delivers the most , based on an answer from our CSO and co-founder Thom Campbell on Quora.
For us it comes down to this (deeply mathematical) equation: Good software + well-integrated workers = fun, fast accurate work; bad software + workers = hard times on the production line.
This places a lot of emphasis on the quality of the technology you choose, and with good reason. A hard-working, smart and motivated team is always important and sought-after in the warehouse and beyond, but the software they use can easily be overlooked if you don’t know what works best.
When it comes down to it, we’re actually a software company that does some heavy lifting; a solution provider for challenges relating to efficiently getting orders to our clients’ customers, both individuals and retailers.
Of Orders and Acronyms
To follow an order through the supply chain, first you need to get it from your e-commerce platform or drop-ship retailer to your fulfillment provider, whether it’s internal or a third party.
The main means of integration are (apologies in advance for the government-like flurry of acronyms to follow):
FTP (file transfer protocol),
API (application programmer interface, or web services),
EDI (electronic data interchange), and
XML (extensible markup language.)
Most of our e-commerce integrations are via a secure FTP server we host. Capacity clients submit orders in batches at preset times and they are uploaded into our system. Our system screens for duplicates, items or shipping methods we don’t recognize, or other common issues which might cause the file to ‘bounce’. The next most common approach is API, where a client reaches out to our web services server with a real-time query. For example a query might be ‘here’s an order’, or ‘what is the tracking # for this order’, or ‘what is the inventory level for this item’.
So the order software has to have that ability to integrate and validate order data. Sometimes it’s important to perform address validation, sales tax calculation, and other services, but mostly we see that happening upstream, at the e-commerce platform level.
The system we use to provide dashboard visibility into our services is an internal proprietary order management software (OMS), which we imaginatively called ‘Intra’ because it is located on our intranet. Our clients get a ‘through the firewall’ version called, again with all our imaginative forces brought to bear, the ‘Capacity Client Center’.
Its purpose is much what it sounds like: providing clients with real-time online access to order status and inventory information, modifying SKU/product information, changing ship methods, creating and downloading reports, and many other aspects of our service. Intra is also very involved in how we integrate with retailers, housing the tables and rules for dealing with over 300 of the retailers we ship to who require EDI.
We’ll break off here to give you some time to digest how your order handling system stacks up against the ideas above. The next entry moves into how technology drives the physical fulfillment process, from picking to shipping and delivery. You can read part two here.
Read the rest of our Unpacking posts here, or connect with Capacity LLC on Facebook or Linkedin to let us know what you’d like to see next.
Contact us if you’d like to talk more about how order fulfillment technology can work for your business.