When Growing Your Business Means Rethinking How You Fill Orders
One of our more recent customers had a problem.
She was running a small ecommerce business selling specialty yarn. She’d found an overseas manufacturer, placed a bulk order, and had an entire 40-foot shipping container of inventory arriving the next day.
There was just one thing she hadn’t quite worked out.
Where was she going to put it?
It’s the kind of situation that illustrates how quickly an ecommerce business can outgrow its original setup. Buying merchandise in bulk may make good financial sense, but receiving, storing, managing, and shipping that inventory is another matter entirely.
What works when you’re shipping a few orders from your garage doesn’t necessarily work when you’re purchasing full containers of merchandise or processing hundreds of orders every month.
And that’s usually when businesses begin asking whether it’s time to outsource fulfillment.
At C&O Warehousing, we believe the decision involves more than order volume or the cost of hiring a fulfillment company. It’s about understanding what your current operation requires, where you want your business to go, and whether handling everything yourself is still the best use of your resources.
How Much Fulfillment Can You Realistically Handle Yourself?
There’s no universal order volume that determines when an ecommerce business needs a fulfillment partner.
A business shipping 50 small, straightforward orders per week may have a very different workload than one shipping 50 large products that require special packaging.
Still, based on our experience, around 100 orders per week is a reasonable point to start evaluating your options.
Think about everything that has to happen before an order reaches your customer.
You need space for inventory and shipping supplies. New merchandise has to be received and organized. Orders need to be picked, packed, labeled, and shipped. Meanwhile, you’re keeping track of inventory, replenishing packaging materials, and handling the occasional return.
None of it is particularly complicated when you’re processing a handful of orders. But as volume increases, those responsibilities start taking up a considerable amount of your day.
None of these responsibilities necessarily seems overwhelming on its own. Together, they can consume a substantial part of your working week.
And that’s before your next busy season or successful promotion.
What Happens When Sales Suddenly Take Off?
Craig has a saying about ecommerce businesses: You’re one TikTok away from making it big.
A product catches someone’s attention, a video takes off, and suddenly the business that was comfortably handling its existing order volume has more demand than it knows what to do with.
That’s a good problem to have, provided you’re equipped to handle it.
But what happens if you have 100 units available and suddenly receive orders for 2,000?
Where will the additional inventory go? Who will receive it? How will you find enough people to pack and ship everything?
Even less dramatic fluctuations can be challenging. A business may need additional help for a few hours a day during a promotion, then have relatively little work for those employees the following week.
Finding and maintaining that kind of flexible labor isn’t always easy.
One advantage of outsourced fulfillment is that you’re working with an established warehouse operation that can adjust space and labor as requirements change, rather than trying to build that capacity yourself every time business picks up.
The Cost of Doing Your Own Fulfillment Isn’t Always What You Think
Cost is understandably one of the first things an ecommerce owner considers when evaluating fulfillment companies.
And we won’t tell you that outsourcing automatically saves money.
Depending on your current operation, the initial cost of working with a fulfillment provider may come as a surprise.
But before comparing that quote to what you’re currently spending, it’s worth asking whether you know your actual fulfillment costs.
Start with space.
If you’ve been operating from home, you may not have assigned a dollar value to the room your inventory occupies. If you’re considering leasing warehouse space, you’ll need to account for the rent and everything involved in operating that facility.
Then there’s labor.
Someone has to receive merchandise, organize inventory, pick and pack orders, maintain supplies, and prepare shipments. If that person is you, your time still has value, even if you aren’t paying yourself an hourly wage for the work.
Packaging is another consideration. Businesses using branded boxes or other customized materials may need to purchase and store those supplies in bulk.
Shipping costs deserve attention, too, although shipping software and carrier accounts are available to businesses handling their own orders. The question is how much time and effort you’re spending managing that process, and whether your current shipping arrangements are meeting your needs.
The comparison isn’t simply between what you’re paying now and what a fulfillment company quotes you.
It’s between the full cost of operating your own fulfillment process and what you would gain by having someone else manage it.
What Could You Be Doing With That Time Instead?
This is the part of the calculation we think business owners sometimes overlook.
When you’re handling fulfillment yourself, your attention is divided between operating the business and getting orders out the door.
As volume grows, fulfillment can begin consuming the time you would otherwise spend developing products, improving your website, marketing, or finding new customers.
Outsourcing creates an opportunity to put that time back into the business.
That doesn’t necessarily mean your monthly expenses will immediately decrease. But if someone else is managing the warehouse operation, you have more freedom to concentrate on the work that helps your company grow.
For many ecommerce businesses, that’s the more important return.
What Does Ecommerce Fulfillment Outsourcing Actually Change?
Working with a fulfillment company means handing over much of the physical work involved in managing and shipping your inventory.
At C&O, that includes receiving merchandise, providing warehouse storage, tracking inventory, and picking and packing customer orders.
Our system also helps select the best available shipping option, eliminating the need for business owners to spend time comparing shipping methods for individual orders.
But there’s an important distinction between outsourcing fulfillment and giving up control of your business.
You still control your products, inventory decisions, marketing, and the direction of your company. Customers also retain visibility into their inventory, and we can accommodate certain carrier preferences.
What changes is your responsibility for managing the physical warehouse operation.
Instead of worrying about where to put another shipment or who will pack tomorrow’s orders, you can focus on what your business needs next.
Your Warehouse Needs Will Change. Your Fulfillment Partner Should Be Able to Change With Them.
Ecommerce rarely grows in a perfectly straight line.
Some months are busier than others. A new product may sell better than expected. Seasonal demand can increase order volume substantially, while other periods are relatively quiet.
Your inventory requirements can change just as quickly.
We’ve seen this with customers whose product catalogs have expanded considerably over the years.
Tactical Baby Gear, for example, began with diaper bags and now offers a much broader selection of products. Another established ecommerce customer, Emily de Molly, has grown from an estimated 100–200 SKUs to several hundred.
That kind of growth affects how much space a business needs and how its inventory must be organized.
We’ve also adjusted our own operations as customers’ order volumes have increased, expanding their storage footprints, changing product configurations, and shifting available labor to accommodate additional fulfillment activity.
The benefit is that customers don’t have to independently lease more space, purchase equipment, or hire additional warehouse personnel every time their needs change.
With reasonable planning and communication, we can adapt the operation alongside them.
Does Outsourcing Make Sense for Every Ecommerce Business?
Not necessarily.
Some ecommerce owners are perfectly happy managing a small operation themselves.
If you’re fulfilling a manageable number of orders, have sufficient space, and aren’t looking to expand significantly, there may be little reason to change your approach.
The type of merchandise you’re selling also matters.
Large, bulky products can require substantial storage space relative to the number of orders they generate. A business shipping individual trampolines, for example, has different warehousing economics than one selling small products that can be stored in relatively little space.
That’s why the decision should be based on your actual operation rather than a general rule about when businesses should outsource.
We’d encourage you to consider what you want to accomplish.
Are you hoping to add more products? Increase order volume? Spend more time on marketing? Stop using your garage as a warehouse?
Or are you satisfied with the way your business currently operates?
There’s no single right answer for every company.
Choosing a Fulfillment Partner That Can Support Your Growth
If you’ve decided to explore order fulfillment outsourcing, take the time to understand how prospective providers operate.
The lowest advertised price isn’t necessarily the best indication of what you’ll actually pay, particularly when receiving, storage, order processing, shipping, and other services may be charged separately.
We’d suggest starting with a few practical questions:
- Can you accommodate changes in my inventory and order volume? Ask how the provider handles seasonal increases, promotions, and changing storage requirements.
- Do you have the personnel to get my orders out on time? Warehouse capacity is important, but so is the labor available to process orders.
- How do you manage shipping? Find out what carrier options are available, how shipping decisions are made, and how costs are calculated.
- What does your pricing cover? Understand the full cost of working together, including any charges that may not be reflected in the advertised fulfillment rate.
- Can I see what’s happening with my inventory? You should know what’s in storage, what’s been shipped, and how to get answers when you need them.
One more thing we’d emphasize: be honest about what your business needs.
We ask prospective customers a lot of questions, and there’s a reason for that. We need to understand their products, inventory, order volume, and how much those requirements might change. The more accurate that information is, the better we can determine what it will take to support their operation.
Option 5: Shorter and Tighter It also means working with a provider that communicates clearly about pricing, capabilities, and what it can accommodate.
At C&O, we ask a lot of questions when getting to know a prospective customer. It’s how we determine what their operation actually requires and whether we’re the right fit.
The Bigger Question: Where Do You Want to Take Your Business?
If you’re debating whether it’s time to outsource fulfillment, we’d encourage you to think beyond the immediate expense.
Ask yourself where you want to take your business.
Are you happy with your current sales and the amount of time you spend managing orders?
Or would you rather put more of that time toward marketing, developing new products, and planning your next stage of growth?
If you’re ready to grow, your fulfillment operation needs to be able to support that ambition.
C&O has spent years working with ecommerce businesses whose inventory, product lines, and order volumes have changed over time. We understand that the right warehouse solution today may need to look different tomorrow.
Whether you’re running out of storage space, spending too much time packing orders, or simply wondering whether there’s a better way to manage fulfillment, we’d welcome the opportunity to learn about your operation.
Tell us where your business is today and where you’re trying to go.
Let’s move your business forward.