Location of the Facility
Location is a critical factor when making a selection for fulfilment provider. It’s usually a function of where your product is manufactured or procured and where your customers are located. Many companies unknowingly believe that it has to be located close to them – which may be helpful if you are more “hands on” and would prefer to keep tabs on your partner while building a closer relationship. But keeping an open mind will open up avenues that could lead to increased performance, lower costs, and less headaches.
Of course, many would argue that the company with the lowest prices would be the best way to go. Sometimes, however, you get what you pay for. Use your common sense — when a company comes in much lower than others, you might want to consider why. If something seems too good to be true, it probably is. Furthermore, quality is extremely important. For a company to provide high quality services, they won’t necessarily be the cheapest company out there. Some of the fees may include a minimum fee, storage fees, and pallet fees. Ask questions and compare fee structures.
Flexibility and Additional Services
You should also think about the types of services you might need. Is everything you do rather straightforward and simple, or do you often need to have kits or bundles put together? What about your company and your products might make it more difficult for the average fulfillment company to handle? Understand what additional services you might need and how flexible you need the fulfillment company to be. This will help to ensure you are working with the right company that “gets you” from the start.
Create a Realistic Budget
From there, you need to look at your books and decide what you can realistically afford to spend on fulfillment. The pricing models of different fulfillment services can vary. But you should think about how much you can afford to spend per unit while still making enough off of each sale.
Find Out About Returns
Returns or exchanges can also be a major issue. If you need your fulfillment company to handle them for you, then you need to make sure they have the ability to do so. And you should also ask more detailed questions about their process for returns.
Find a Transparent Company
The most important thing is to find a company that’s transparent. If they are willing to answer your questions and don’t try to hold back information, you’re likely to have a good working relationship with your fulfillment service.
You are starting a new business or you are an already established business looking to cut down on overhead cost, you ask yourself should I undertake the hassle of leasing a warehouse space and hiring a full staff to run my company? Should I alternatively send my product to a third-party warehouse who’s well equipped in taking care of my distribution needs? In this blog I am going to break down some of the benefits and why you should consider hiring a third-party warehouse who specializes in distribution.
First let’s start with the warehousing or storage of your goods. A typical 2,000- 5,000 square feet warehouse in the Greater Toronto Area for lease can cost anywhere from $2,000.00 – $7,000.00 plus utilities. The current pricing for storage per pallet is anywhere from $12.00- $20.00 depending on the product. Based on the pricing above to lease a warehouse, you can potentially store 133- 350 pallets with zero overhead cost.
Secondly let’s discuss all the additional cost with setting up your own warehouse. You will need finances for warehouse equipment (e.g. forklift, pump truck, walkie, etc.), warehouse racks for storage or floor space to store pallets, bins to store small items or parts. A reliable inventory management system for items location, picking and tracking. A warehouse management system can cost anywhere from $29.00 USD cloud based per month to thousands of dollars depending on your current needs. You will also need office equipment (e.g. desks, chairs, computers, telephone system) and internet service. With 3LP warehousing you are able to save and eradicate all these overhead costs while providing outstanding service to your customers for a fraction of the cost.
Lastly, we will cover staff requirements, wages, WSIB and insurance. The smallest warehouse operation will require at least one to two employees, the minimum wage in Ontario is $14.00 per hour, plus employer tax matching along with WISB and additional cost for each employee. You will also require business insurance and additional insurance to cover all your assets and inventory in case of fire, loss or thief.
In closing the benefits of using a third-party warehouse is an overwhelming better choice than having to set up a warehouse from scratch. Many third-party warehouses are well versed and include complete distribution solutions to meet a customer’s needs. At Antoine Fulfillment we have a team of well-trained staff to fulfill all your warehousing and distribution needs.
Container stuffing / De-stuffing
Container Loading & Unloading
On Line Inventory
The experienced professionals at Antoine Fulfillment will take care of all of your needs from warehousing and distribution to pick and pack or facility optimization and all of your other supply-chain functions so you can focus on product development and sales.