Business owners who offer subscription box services are on the rise, and with good reason. Having items shipped regularly to you saves time shopping and, in most cases, money. More customers are subscribing to recurring shipments for these reasons and out of convenience.
Whether they’re offering a monthly subscription to toiletry items, food services, vitamin packages, or anything else, having these items shipped weekly, monthly, or bi-weekly to a customer ensures repeat customers and a constant flow of revenue.
While setting a schedule of when to ship a subscription box to your customers and filling them yourself can be rewarding and appear inexpensive, as you grow your business, it may get more complicated.
If you offer subscription services with your business, looking into a fulfillment center can help alleviate some stress when handling it yourself becomes too time-consuming and even too costly.
Trusting your business with another party may seem intimidating, but it can be beneficial for your company. Plus, most fulfillment companies prefer to refer to you as their partner, not their client.
When you learn more about what a subscription box fulfillment center is and how it can benefit you and your business, you may find yourself browsing for a fulfillment company to help save you time and money.
What Is a Subscription Box Fulfillment Center?
If you subscribe to a subscription box of any kind, there’s a good chance that it originated at a fulfillment center. Even though it’s still from the business you purchased it from; you’ll find that many business owners utilize these efficient third-party companies.
A subscription box fulfillment center is when a company ships products from an eCommerce merchant on a set schedule. Many companies utilize a third-party subscription fulfillment center rather than doing everything in-house or on their own.
These fulfillment centers ensure that the product or products you’re shipping to your customers will be sent out and arrive on time, whether monthly, quarterly, or even weekly. As a business owner, you can set the delivery options for your subscription boxes.
The product or products that are regularly shipped can be the same products every time, or they can change—for example, a monthly vitamin supplement subscription, razors, or a meal kit service. If you find a product you like, you can have it sent to you regularly.
For example, many people opt to try new recipes for meal kits until they find recipes they want to continue purchasing.
Fulfillment centers are especially great for keeping track of when a customer’s next shipment is supposed to ship out to them.
If you base the next scheduled box on their date of purchase, it can be hard to keep track of when customers can purchase subscription boxes any day of the week. This way, it’s easier to keep up with all customer’s subscriptions without accidentally missing one or more.
Ensuring your customer receives their subscription box on time each cycle will instill trust in your customers. If their box was supposed to arrive on the first but isn’t there on the fifth, it can cause them to question a subscription service.
How Does Subscription Fulfillment Work?
Subscription fulfillment works to keep your subscription business running smoothly. You’ll maintain complete control of your business by working with a third party to ensure your subscription boxes are shipped on time and with the correct products.
Maintaining a schedule of when subscription boxes need to be shipped to which customers keeps everything running smoothly and your customers happy.
There are several options for subscription fulfillment centers available right now. Some fall into specific niches such as makeup, clothing, food, and much more.
If you’re planning to utilize one of these services for your subscription box company, finding a fulfillment center specializing in the type of product you’re selling is essential.
Challenges of Subscription Box Fulfillment
When filling subscription boxes on your own, keeping up with the schedule of sending recurring purchases to customers can be tricky. It requires a high level of organization and, even with that, can be time-consuming.
If you don’t have a strategy to keep up with when a particular customer’s orders are supposed to get mailed to them, it won’t be easy to stay on top of your subscription orders. This is where a subscription fulfillment center can assist you.
For subscription services that send the same products regularly, it’s not nearly as much of a challenge as those who change out products every time. In addition, it’ll take even more time to pick out the new items than to be in a routine with shipping the same products.
Another challenge that you may face with fulfilling a subscription box is assembling the package. If your subscription box is on the smaller side with only one or two products, the assembly shouldn’t take you too long.
For subscription businesses that offer a more significant number of products in a larger package, it’s going to take longer to assemble one box. When you’re trying to package many orders that need to ship out on a specific date, this can be incredibly time-consuming to do by yourself or even with one other person.
Should You Outsource Fulfillment of Your Subscription Box?
If you offer a subscription service with your business, outsourcing your fulfillment to a third-party fulfillment center may be a good option for you. However, whether or not outsourcing fulfillment of your subscription boxes is right for you is dependent on a few factors.
The three main factors that can help you determine if outsourcing fulfillment is for your company are the volume of boxes you’re shipping, how much assembly needs to be done for each package, and whether it’s the same products for every subscription box.
When you’re only shipping a small volume of subscription boxes a month from your business, paying to partner with a fulfillment center may not be cost-effective for you. Fulfillment centers can save business owners money, but they can cost you more money if you’re not shipping a high enough volume.
As you grow your business and the volume of subscription boxes you’re shipping monthly or weekly grows, partnering with a fulfillment center can save you time and money.
The amount of assembly required for your subscription boxes is also a factor but depends on the first factor. If you’re selling a small volume, it doesn’t matter how easy or difficult it is to assemble the box.
Assembling it yourself is your best bet. Once your volume increases, even if you can handle it yourself, the more complex the assembly, fulfillment centers can take some of the burdens off you.
If you’re providing a product that is the same every month or shipping period, outsourcing order fulfillment may help keep things moving quickly with your business. These fulfillment centers can promptly get those products packaged and shipped to your customers and stick to a schedule.
Businesses that offer different products every month or more curated items may not benefit from using a fulfillment center. When you’re sending new products every month to your customers, packaging orders internally can help ensure quality standards are maintained and the customer gets exactly what they’re expecting.
This isn’t to say that your business cannot benefit from a fulfillment company if the products change in each subscription box. Fulfillment centers can still handle this task, but business owners tend to enjoy selecting and shipping out their packages for curated items.
7 Benefits of a Subscription Box Fulfillment Center
Now that you know what a subscription box fulfillment center is, you can start trying to decide if your business could benefit from one. Then, if you still need a little convincing, take a look at these seven great benefits of using a subscription box fulfillment center to optimize your business.
1. Fulfillment Centers Save You Time
When you’re running a business, every minute is essential, and almost every day is jam-packed with tasks to do. Having a busy day is especially true if you’re running everything on your own.
When you’re running a subscription box business, you have a little more to keep track of than filling customer orders as they come.
When you utilize a third-party subscription box fulfillment center, you’re outsourcing some of the more challenging work. They’ll keep track of when boxes need to be shipped out and will fill them on time.
Partnering with a fulfillment company will ultimately save you time and allow you to focus on other aspects of your business, such as marketing, customer service, and growing your business to what you want it to be.
2. They Handle Inventory Management
Whether you’re utilizing a fulfillment center to send the same products to your customers every month or one to send a variety of new products, finding one that can adequately manage your inventory for your business will be beneficial.
Whichever fulfillment center you choose, you’ll need to provide them with your inventory. Once they have your stock, the fulfillment center will manage your inventory and ensure that they always have the products on hand to be shipped out on time.
A fulfillment center that can provide inventory management will give you more time to handle other aspects of your business. For example, you won’t have to keep track of how many of what products you have.
Granted, keeping your own inventory on your products is always a good idea to ensure that it aligns with the fulfillment company.
When your inventory that the fulfillment center has is running low, the company you’re partnered with will inform you, and you’ll be able to ship them more.
3. Shipping Is Handled For You
Running back and forth to the post office for every order can make a busy day even busier. That day will get even more dynamic when you have to bring many subscription boxes at once.
As mentioned previously, you’ll need to get your company’s inventory to the fulfillment center you choose. Once your inventory is at the center, you don’t have to worry about shipping out the subscription boxes yourself.
Not only does the fulfillment center fill the scheduled orders for you, but they’ll also create labels and ensure they’re shipped directly from the facility.
With a fulfillment company handling shipping for you, you don’t need to go to the post office, UPS, FedEx, or any other company yourself.
4. It’ll Save You Space
Many small businesses start in the owner’s home. Unfortunately, not everyone has the luxury of having a spare room or garage to run their business from. And even if you do, it may not be how you want to utilize your space. This lack of space can create havoc in a home.
Having boxes and boxes of orders and inventory clogging up your space may not be the most productive way to work. Because you will ship your merchandise to the fulfillment center, you’ll have a lot more space in your room or garage.
5. You’ll Save Money on Shipping Costs
When using a fulfillment center, something to keep in mind is that even though the center will handle shipping for you, you’ll still need to pay for shipping the subscription boxes to your customers.
When you’re shipping everything by yourself, not only can that be stressful, but it can be expensive.
However, because subscription box fulfillment centers are large-scale operations that regularly ship products, they can usually get you much better shipping rates than if you were to do it independently.
While many fulfillment centers can get you less expensive shipping rates, it’s best to speak with someone from the ones you’re looking at to see what those rates will be.
Another great thing about subscription box fulfillment centers is that they may have more than one warehouse location, depending on the fulfillment center you choose. If they have more than one location, you’ll want to learn where these warehouses are.
Shipping products from a warehouse that’s close to your customer will keep your rates low. For example, when you can ship a subscription box from a warehouse that’s an hour from a customer instead of 20 hours, there’s a good chance you’ll save money on shipping.
6. They Help Avoid Service Errors
When you’re handling everything on your own or entrusting someone internally to fill your customer’s orders, there’s room for error when you’re balancing other things.
Fulfillment centers’ only job is to fill your customers’ orders correctly, whereas you’ll have a lot more on your plate as a business owner.
Fulfillment centers operate at high speed with high efficiency. In addition, these well-oiled machines continue to prove they can prevent service errors when shipping products to customers.
While errors are still possible with fulfillment centers, it’s less likely to happen due to them fully dedicating themselves to filling orders as quickly and accurately as possible.
If there happens to be a service error on the fulfillment center’s part, returning the incorrect items is the center’s responsibility.
They make returning items easy by providing a new shipping label and packing slip or box so customers can easily exchange the incorrect item for the correct one.
7. You’ll Have Less Overhead
When you are packing all your customer’s subscription boxes yourself, it can be rewarding, but it also creates a lot of overhead.
We’ve already touched on how using a fulfillment center can save you space, but it can also save you money on paying someone internally to package everything.
In addition to saving you money on hiring someone to help you or fill customer orders, you’ll be saving a lot of money on packaging materials.
Packaging your orders will require a combination of a box or packing slip, bubble wrap, tissue paper, packing peanuts, and shipping labels. Whatever you use to assemble your subscription box, the materials can add up.
Subscription box fulfillment centers purchase these materials in bulk to use for their partner’s subscription box orders. Whatever you pay for a membership with a fulfillment center, the cost of packaging materials will be included.
Therefore, the money that they save on buying all packing materials in bulk usually passes these savings on to their partners.
Operating a subscription box business is incredibly popular in this day and age for multiple reasons. These services allow customers to try products they may not find in big box stores. Second, they’re conveniently shipped to them, eliminating people having to remember to purchase whatever is in their subscription box.
In addition, recurring purchases that arrive promptly are a great way to build a solid customer base and offer fantastic customer service. Seeing their box on their doorstep or in their mailbox can brighten someone’s day.
If you can handle filling and shipping your customer’s subscription boxes in house, that’s wonderful. But if you’re looking for a way to send things that is cost-effective, save yourself some time, and overall improve your customer service, a subscription box fulfillment center may be something to explore.