Supply Chain Enabled

eCommerce fulfilment – in house or outsource?

Published: August 1, 2023
Author: Lorcan Sheehan

Many companies, particularly at early stage, face a common dilemma around eCommerce fulfilment.  Is it better to maintain in house – keeping control over that vital customer experience, or to outsource to a provider that can manage professionally and at scale?

In house fulfilment– Direct control of the customer experience.
– Opportunity to deliver increased personalisation.
– Learn and amend service based on direct customer feedback.
– Need to be prepared to invest in infrastructure – systems, workstations and storage facilities.
– Initial learning curve – logistics, incoterms, packaging, international trade.
– Need to hire and retain experienced personnel.
– May find it more difficult to scale with the needs of the business.  
Outsource– Leverage existing facilities, infrastructure, and systems.
– Leverage existing knowledge based and carrier relationships.
– Ability to deliver scale volumes and geographies as needed.
– More formal reporting on service and performance.
– May have higher fixed costs – especially when volumes are low.
– Requires up front definition of requirements and planning for volumes.
– Requires systems integration and clarity on order, returns and customer service flows.
– Menu driven costs – anything is possible, but each activity will drive additional costs.  

The best choice may be different by company and may also be different by stage of development for the company.  

In the very early days, companies may not know enough about their requirements to be able to define what they want from an outsource provider.  Different outsource providers will also provide different levels of flexibility, fixed costs, and requirements around systems integration.  

We will be exploring these and other issues in a UK context this week on a webinar with Enterprise Ireland.  Register here.

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