Start A Fulfillment Business - Business Ideas
Please note that the data provided in this article are estimates and may vary depending on various factors, and should not be considered as perfect or definitive.
As e-commerce becomes the pillar in our retail landscape, fulfillment businesses are becoming more important.
Fulfillment companies enable e-Commerce by processing order receipts, packing, delivering, and handling returns from clients. These businesses act as a third-party warehouse and their core responsibilities include preparing and shipping orders. Thus, they store goods until they are ready to send to stores and customers. If you are planning to start a fulfillment service, some of the services will include:
- Same day-delivery
- Customer support through chat, text, and phone call
- Complete order tracking from arrival at the fulfillment center to delivery to customer's door
- Custom API integration
- Climate-controlled storage space
To start a fulfillment center you need to find space, streamline with software, and set up and understand business KPIs with the target e-Commerce companies.
Starting a fulfillment business requires a great deal of effort, dedication, and most importantly passion.
If you're interested in how to sell fulfillment services, or selling fulfillment services online, you can use this page as a guide for everything you'll need to know.
Key Stats
Startup Costs
| Min Startup Costs | Max Startup Costs | |
|---|---|---|
|
Office Space Expenses |
$0 |
$7,000 |
|
App Creation Costs |
$1,099 |
$20,099 |
|
Software Expenses |
$162 |
$2,894 |
|
Advertising & Marketing Costs |
$0 |
$2,500 |
|
Website Costs |
$13 |
$215 |
|
Training & Education Expenses |
$0 |
$850 |
|
Total Startup Costs |
$1,274 |
$33,558 |
Case Studies
•
$25M/mo
•
$2M/mo
•
$90K/mo
•
$150K/mo
Successful Businesses
| Business | URL | Rank | |
|---|---|---|---|
|
|
TJX |
tjx.com |
7,752 |
|
|
ShipMonk |
shipmonk.com |
12,847 |
|
|
Shipwire |
shipwire.com |
17,211 |
|
|
Rakuten Super Logistics |
rakutensl.com |
42,045 |
|
|
Flowspace |
flow.space |
59,108 |
|
|
Shipfusion |
shipfusion.com |
59,381 |
|
|
Fulfillman |
fulfillman.com |
67,795 |
|
|
Best Buy Careers |
bestbuy-jobs.com |
75,624 |
|
|
Radial |
radial.com |
84,847 |
|
|
Red Stag Fulfillment |
redstagfulfillment.com |
96,109 |
|
|
Product Fulfillment Services |
efulfillmentservice.com |
100,632 |
Pros & Cons
| Pros | Description |
|---|---|
|
Flexibility |
You can put as much time into the business as you'd like. If you like the work and have some initial experience, you can start small and manage all aspects of the business on your own. |
|
Ability to start your business from home |
It's not necessary to have a physical storefront or office space to get your business started. You can do everything from the comfort of your own home, at least in the beginning! |
|
Rewarding work |
Starting a fulfillment business can be really rewarding work. After all, you are solving an immediate issue for your customer and you're working on something you truly care about. |
|
Scalable |
With businesses and processes changing daily, there will always be demand for new features, products and services for your business. Additionally, there are several different business models and pricing tiers you can implement that will allow you to reach all types of customers. |
|
Traffic to your website |
A fulfillment business gives people a reason to visit your website and to keep coming back to you! |
|
No overhead costs |
To get your fulfillment business started, there are no costs associated with overhead, storage, packaging, etc. This will save you a lot of time and money! |
| Cons | Description |
|---|---|
|
Crowded Space |
Competition is high when it comes to your fulfillment business, so it's important that you spend a good amount of time analyzing the market and understanding where the demand lies. |
|
Motivation of employees |
If you plan to have a sales/content team on board, finding creative ways to motivate them can be a challenge. It's important that you're able to offer great incentives and a good work environment for your employees. |
|
Longer Sales Process |
A fulfillment business can be a big time and money investment for your customer, so it's important you plan and predict a longer conversion funnel and stay in communication with potential customers. |
|
Security Issues |
With any Saas business, data loss and security issues may arise throughout your process of building your product. It's critical that you understand exactly what you're responsible for and how to avoid potential issues down the road. |
|
Isolation |
Often times, as a fulfillment business, you typically work alone and do not have much face-to-face interaction with other team members. |
|
Taxes |
As a fulfillment business, you typically pay self-employment taxes which can be quite high. It's important to understand what you will be paying in taxes each year so you can determine if the work you're taking on is worth it. |
Marketing Ideas
-
1
Affiliate Program
Affiliate marketing is a great way to bring in a new revenue stream, especially when you don't sell products or services.
Simply put, an affiliate program is an agreement where a business pays another business or influencer ("the affiliate") a commission for sending traffic and/or sales their way.
The affiliate typically gets a unique link where clicks and conversions can be tracked.
-
2
Direct Sales
Direct sales strategy implies a direct contact between a seller and a consumer without the involvement of any third party. Direct selling is popular in sectors where sellers communicate with their clientele personally. The sales technique occurs at non-store locations which include at home, work, or online.
For direct selling to succeed, hire a few (or many) salespeople to support the sales conversion process. It's critical that you assign them specific roles and responsibilities to nurture the client and provide excellent support.
-
3
Word of mouth
Word of mouth is when a consumers reflects their interest in a company’s product or service in their daily dialogues.
Therefore, word of mouth advertising is essentially a free advertising triggered by the customers experience.
According to Nielsen, 92% of people trust recommendations from friends and family.
Therefore, in today’s hyper-connected world, a single recommendation through a word of mouth can have a huge impact to your business.
Hey! 👋 I'm Pat Walls, the founder of Starter Story.
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