Every business shares a common aspiration: growth. Naturally, the manifestation of growth can differ depending on the business type and industry. For online brands and eRetailers, it may involve expanding product distribution to brick-and-mortar stores, large retail chains and online marketplaces. Opening these new channels requires planning and thoughtful financial analysis of the costs and benefits of wholesale warehouse distribution models. In addition, there are considerations about choosing reliable business-to-business (B2B) fulfillment warehouse service partners. It is crucial for E-commerce brands and eRetailers to collaborate with a capable 3PL (Third-Party Logistics) provider to leverage the technologies and operational processes to handle the increased volume and facilitate sustainable growth.
You may be wondering, aren’t fulfillment warehouse operations all the same? The simple answer is “no.” B2B warehouse fulfillment differs from direct-to-consumer (DTC), also known as business-to-consumer (B2C) wholesale warehouse fulfillment. B2B fulfillment refers to the process of fulfilling orders and meeting the logistical needs of business-to-business transactions. Often times, 3PLs are competent in one or the other, but not both. The diagram below outlines the potential flow of goods from an online retailer who is the “producer” of the goods.
Unlike direct-to-consumer (DTC) order fulfillment companies, where products are shipped directly to individual consumers, B2B warehousing fulfillment focuses on meeting the needs of other businesses in the supply chain. This often involves larger individual orders, higher order volumes, specialized packaging or labeling, and tailored logistics solutions to accommodate the unique and mandatory requirements of brick-and-mortar retailers and online marketplaces.
In the B2B context, orders are still picked, packed, and shipped, but on a larger scale due to the larger quantity of items. A 3PL provider offering B2B capabilities must have the systems, people, and processes to comply with packaging and labeling guidelines specific to each retailer and marketplace. Routing Guides and delivery windows are specified, and failure to adhere to these requirements could result in chargebacks or even refusal of merchandise.
B2B buyers typically have less frequent ordering cycles and make bulk purchases, often involving large carton or pallet quantities with specialized packing requirements. While the overall fulfillment warehousing processes are similar to DTC methods, the order-processing technology, packaging, product and/or carton labeling, and shipping requirements for B2B orders can differ significantly. Many large retailers require information about the order to be exchanged via EDI (Electronic Data Interchange), a well-established and standardized method for exchanging data between two order management systems. Finally, it is crucial to note that most retailers impose financial chargeback penalties when packing guidelines and timeliness requirements are not fulfilled.
To meet the demands of B2B fulfillment, a 3PL must invest in technology that is compatible with EDI formats that are widely used by large retailers. Additionally, they need to establish technology integrations necessary for operating with major marketplaces like Amazon, Walmart, Faire, or Shopbob, to name just a few that might represent an eRetailer’s OmniChannel e-commerce strategy.
A word about “Omni-Channel” commerce: simply put, omnichannel retail (or omnichannel commerce) is a multichannel approach to sales that’s focused on providing seamless customer experiences, whether the customer is shopping online from a mobile device, on a laptop, or in a brick-and-mortar store. This approach should resonate with eRetailers and their partners in fulfillment warehouse services.
B2B Fulfillment Capabilities
Third-party logistics (3PL) providers must offer specific services to facilitate efficient and effective business-to-business (B2B) order fulfillment. These capabilities typically include:
-
- Order Processing
- Inventory Management
- Warehousing
- Shipping and Delivery
- Technology Integration
- Value Added Services (VAS) and Compliance
Order Processing: Efficiently processing B2B orders, including order verification, order entry, and order tracking.
Inventory Management: Implementing systems and processes to manage inventory levels, ensure the availability of products for B2B customers, and minimize stockouts or overstock situations.
Warehousing: Providing secure and organized warehousing facilities to store SKUs for B2B operations. This includes proper storage, shelving, and inventory tracking systems to enable accurate order fulfillment. Efficiently picking products from the warehouse locations and packing them according to B2B customers’ requirements. Some wholesalers may require additional services such as kitting, labeling, customization, or special handling based on the specific needs of B2B customers.
Shipping and Delivery: Coordinating the logistics and transportation for B2B shipments, including selecting the appropriate carriers, managing shipping documentation, and ensuring timely delivery to B2B customers. TMS, and Transportation Management Systems are effective tools for managing these variables.
Technology Integration: Utilizing technology systems and integrations to streamline B2B fulfillment processes, including order management systems (OMS), warehouse management systems (WMS), electronic data interchange (EDI), transportation management system (TMS), and integration with B2B customers’ systems for seamless data exchange. Boxzooka offers a user-friendly and precise interface encompassing all the essential technologies required for efficient operations.
VAS and Compliance: Ensuring compliance often means that the 3PL must change packaging, labels, or price tickets and provide additional documentation for requirements set by B2B customers, retailers, and marketplaces, as well as adhering to industry regulations and standards.
Looking for a reliable 3PL partner?
Boxzooka stands out among 3PL providers by offering comprehensive warehousing fulfillment services for both B2B (Business-to-Business) and DTC (Direct-to-Consumer) operations. Our warehouses are structured, with distinct areas and workstations dedicated to B2B and DTC fulfillment. This separation ensures that the unique processes of each operation are maintained properly. With advanced technologies, seamless integrations, and white-glove customer service, Boxzooka is dedicated to exceeding your expectations and helping your business grow!
By Tom Behnke
