For e-commerce business owners just starting out, having a place to store all your inventory can be one of the biggest problems you can face.
You may not have enough orders to justify renting an entire warehouse, but you might not have space to store everything in your room or office anymore.
Without e-commerce fulfillment centres, you'd have to suck it up, get a loan and rent out a warehouse for your business.
Doing this, however, can put you in a risky position: what if demand drops? You won't be able to cut back on your fixed costs in a short amount of time.
With fulfillment centres, though, you won't have to worry about this. You can rent as small as one cubic metre of space and upsize (or downsize) according to how demands for your products shift. Best of all, you won't need to hire warehouse staff, and keep them on payroll.
E-commerce fulfillment centres can even handle returns for you, taking the entire hassle of order fulfillment off your hands.
The biggest downside of fulfillment centres is that they are not infinitely scalable economically. At a certain point of your business growth, it will make more business sense to start renting out a warehouse and hire your own staff.
For now though, if you're looking for a cost-efficient way to have your orders fulfilled without renting a big warehouse or hiring warehouse staff, e-commerce fulfillment centres can be the perfect solution!
In this article, we'll take a look how fulfillment centres work, who should use them and finally, we'll take a look at the costs of two of the most popular fulfillment centres in Singapore to help you have an idea of the fees you can expect to pay when you use a fulfillment centre.
Let's get started!
How Do E-commerce Fulfilment Centres Work?
Third party fulfillment centres is a fulfillment option for owners of small and medium e-commerce businesses.
They are a cost-effective alternative to renting your own warehouse and hiring your own warehouse staff which can set you back at least a few thousand extra dollars a month.
With e-commerce fulfillment centres, you can have a hands-free warehousing and order fulfillment services for as low as a few hundred dollars a month if you have few orders.
E-commerce fulfillment centres can offer a more flexible warehousing and order fulfillment service because the warehouse facilities and resources are shared between you and other business owners using their service.
What's even better is that most fulfillment centres nowadays also integrate directly with marketplaces like Qoo10 or platforms like Shopify. So when you get an order, the e-commerce fulfillment centre gets notified and starts the process of fulfilling the order. You don't really need to lift a finger.
All you need to do is send your product stocks to the fulfillment centre warehouses, and integrate your e-commerce store with their platform.
The fulfillment centre will handle everything from there onwards.
Benefits of Using E-commerce Fulfillment Centres
Fulfilment centres take care of one of the most important part of your e-commerce business: packing and delivering to customers.
With fulfillment centres, you don't need to worry about
- Orders decrease or increase suddenly. Storage plans are flexible and can be quickly adjusted accordingly.
- Hiring staff to take care of inventory or process your orders. Fulfillment centres will have professionals who can take care of this for you.
In summary, the greatest benefit that e-commerce fulfillment services can offer you is cost flexibility for warehousing and order fulfillment.
Fees You Can Expect to Pay for E-commerce Fulfillment Centre Services
Of course, to take advantage of the benefits of using fulfillment centres, you'll expect to pay for
- Inventory processing and labeling
- Handling and order processing
- Standard or express delivery fees
- Customer returns
- Inventory removal
Depending on the fulfillment centre, these may be charged separately, or as a bundle fee.
Who Should Use E-commerce Fulfillment Centres
Although best suited for e-commerce business owners on a shoestring budget, fulfillment centres are also great for business owners who
- want to free themselves from having to fulfil orders themselves and don't mind paying a fee for someone else to do it for them
- has a growing business but don't want to bind themselves up to a contract term in case of changes in demand for their products
- want to sell across the border and want to save costs on shipping fees and shipping time (so customers can get their things faster)
If any of these describe you, fulfillment centres might just be the perfect solution for your business needs.
Costs of Popular Fulfillment Solutions in Singapore
from S$9.50 per cubic metre per week
S$40 per cubic metre per month
Company Legal Requirements
Require a Singapore registered company to use
Order Processing & Handling Fees
S$2.40/order + S$1.10/unit
S$1.50 - $3.00/unit (depends on item category)
S$5.49 per parcel up to 3kg
Inventory Removal Fees
Ebay, Shopify , Amazon, Lazada and Rakuten
Lazada, Zalora, Shopee, 11Street, Lelong, Qoo10, Shopify
Note: We are still pending some information from iStoreiSend and will update the above table accordingly as the information is received.
ezyCommerce and iStoreiSend are two of the most popular e-commerce fulfillment centres in Singapore.
As you can see from the table above, both services offer competitive storage, order processing as well as shipping rates. Either service are also ready to integrate with a popular online marketplace of your choice in Singapore or even your own Shopify store.
As each business nature will vary, it will be worth contacting either service to find out which makes the most business sense for your specific business.
E-commerce fulfillment centres can help owners of new, small or medium e-commerce businesses in Singapore with their warehousing and order fulfillment.
With flexible plans and well equipped warehouses streamlined for order fulfillment, fulfillment centres are the perfect partners for e-commerce business owners in Singapore who don't want the worry of maintaining a staffed warehouse or simply want to hand off the order fulfillment part of their business to someone else while they focus on the rest of the business.
If you're an e-commerce business owner who has been overwhelmed with your order fulfillment process, why not give fulfillment centres a try?
Let us know: have you tried e-commerce fulfillment centres in Singapore before? Which one did you have the best experience with?