Fulfilling orders is not the most glamorous aspect of running an e-commerce business, as Transport Intelligence's future forecasts suggest that the volume will grow to between 220 billion and 262 billion parcels by 2026.
The stakes are high, and businesses that do not know how to streamline their order fulfillment process run the risk of closure.
In Shopify specifically, their order fulfillment process is made up of vital pieces. These components work hand-in-hand to implement an effective eCommerce or Shopify fulfillment service.
In this post, we will be breaking these processes down. We will highlight the most important aspects of Shopify Fulfillment to take your business to the next level.
What is Shopify Fulfillment Network?
Shopify Fulfillment Network is part of the broader array of Shopify functions designed to streamline e-commerce operations. It operates through a network of fulfillment centers across various locations, leveraging advanced machine learning technology to enable:
- Inventory allocation
- Order rerouting
- Demand forecasting
These components ensure faster delivery of orders to your customers.
It also aims to help with the following:
- Product packaging: Using the Shopify Fulfillment service, you can customize your packaging using your own branded material, to improve your reach, and brand identity.
- Shipping/tracking orders: The SFN will usually be the one to pick, pack, and then ship your items to your customers. It will also keep them in the loop by providing them with tracking information that's sent automatically after the fulfillment.
- Managing your inventory: With the help of machine learning, the platform will provide recommendations on where to keep your inventory to help save time and shipping costs.
- Reorder processing/returns: It will usually handle any returns or exchanges on your behalf. All of the returns will be eventually repacked and then placed again to your existing inventory.
Shopify Warehouse: Streamlined Storage and Inventory Oversight
The Shopify Fulfillment Warehouse is strategically designed to enhance storage efficiency and streamline inventory management.
Each Shopify Fulfillment Center is part of a robust network designed to optimize shipping zones and minimize delivery times. These centers not only store your products but also manage inventory efficiently, leveraging advanced tools for streamlined order processing and customer satisfaction.
With its strategic location across various regions, it optimizes shipping zones and reduces delivery times. Key features of the Shopify Warehouse include:
- Centralized SKU Management: Manage product variants efficiently from a single platform.
- Inventory Optimization: Store products based on demand forecasts, reducing excess stock.
- Real-Time Inventory Updates: Automate stock tracking to avoid overselling or running out of stock.
Shopify Distribution: Fast and Scalable Fulfillment
Shopify Distribution leverages a robust logistics network to ensure rapid and accurate order delivery. Key highlights:
- Multi-Node Fulfillment: Disperse inventory across locations for improved delivery speed.
- Predictive Analytics: Leverage data insights to allocate stock strategically, especially during peak periods.
- Automated Fulfillment Process: Reduce manual intervention for faster order processing and greater order accuracy.
Together, Shopify Warehouse and Shopify Distribution systems enhance scalability and improve the overall customer experience, enabling businesses to grow while ensuring efficient and reliable fulfillment.
Shopify Fulfillment Features (2024 Updated)
Let's watch a video from Shopify showing all the new updated features of Shopify fulfillment introduced in Summer Edition 2024:
In-Store Pickup (Fulfillment from Store)
Source: Generated by DALL-E
Customers can purchase products online and choose to pick them up at a preferred retail location. This option provides a convenient alternative to home delivery, potentially reducing shipping costs for merchants while offering customers the flexibility to collect their orders at their convenience.
Ship from Store (Inventory Management)
Source: Generated by DALL-E
Retail locations can be utilized as mini-fulfillment centers, allowing merchants to manage inventory and fulfill online orders directly from their stores. This can help in managing stock levels more efficiently and potentially reduce fulfillment times for customers located near these stores. By leveraging Shopify POS, merchants can keep track of in-store inventory and ensure smooth order processing.
Split Shipping
Shopify introduced split shipping in checkout, allowing customers to receive items from different locations in a single order. This flexibility enhances the customer experience by providing more accurate delivery estimates and reducing shipping costs.
Optimized International Shipping
Chances are, most of your products are produced in Asia. But let’s say, you’re catering to European customers. You need to import these products from Asia, ship them to America, and then import them to Europe. You’ll be losing out a lot for every transaction.
In addition to optimizing your logistics, integrating Shopify payment gateways can further enhance your international operations by providing seamless and secure transaction options. The proper way to do this is to ship from the manufacturer in Asia to a fulfillment partner in Europe, who will then handle shipments to your European customers.
These updates aim to create a more integrated shopping experience, enhancing operational efficiency and customer satisfaction by providing more delivery and pickup options. This feature is part of Shopify's ongoing efforts to streamline e-commerce operations and improve the overall shopping experience.
Shopify Fulfillment Pricing and Returns
Shopify Fulfillment Cost & Pricing
Shopify Fulfillment Network offers customized pricing tailored to your business needs. To better understand its value, consider browsing recent Shopify reviews, which often highlight the cost-efficiency and operational benefits of the fulfillment services. If you're interested, you can apply via Shopify's website to receive a personalized quote. Here's 4 things you need to consider in the pricing structure:
- Picking and Packing: The cost associated with selecting items from inventory and preparing them for shipment.
- Storage: Charges for storing your products in Shopify’s fulfillment centers.
- Transport and Shipping: Costs of shipping your products to customers.
- Special Projects: Includes additional services like receiving, bundling, and inventory validation.
For a deeper dive into cost specifics, Shopify provides a handy fulfillment calculator. This tool helps businesses estimate expenses based on their unique requirements. Visit Shopify’s Fulfillment Network Pricing page for more details.
For more details, check out: Shopify Fulfillment Network's Pricing
Fulfillment by Shopify Returns
- Customer Return: Customers send the product back to the fulfillment center.
- Inspection: The returned item is inspected for damages, verifying customer feedback.
- Processing Refunds or Replacements: If the item is faulty, a refund or replacement is issued.
- Restocking: If the item is in sellable condition, it is restocked for future orders.
The Pros and Cons of Shopify Fulfillment Network
When you use SFN, you do not have to worry about packing, picking, or shipping your orders.
Moreover, cross-border selling will also become the future of e-commerce. It will open up your business to more international customers, allowing you to reach customers from all around the world.
Shopify Fulfillment can help you sell in a number of markets, increasing your revenues, and driving brand awareness of your business on an international scale.
You will receive regular notifications in case you need to replenish your stock. Doing so helps the platform meet your customers' demands on time. A well-structured Shopify contact us page can help streamline communication and resolve customer questions efficiently.
It is also easy to track your stocks in real time, even across different platforms via integrated third-party accounts. Not to mention that you get to enjoy lower operational costs.
That's because you do not have to build a fulfillment center on your own or create a packing system from scratch.
The network also hosts several features:
- Multiple channels
- Customized branding and packaging
- Exchanges and returns handling
- Two-day delivery
But apart from these advantages, SFN has its own drawbacks.
- High Costs: Premium plans and SFN services can be expensive.
- Limited Branding: Custom packaging options are restricted.
- Less Control: Shopify manages third-party integrations.
For one, Shopify can be quite expensive, charging as high as $299 for a premium plan. The Fulfillment by Shopify service may also be priced similarly.
This might also hurt your branding experience. Let’s say, your packing presentation is the most important aspect of your branding experience, you’d have a hard time looking for an order fulfillment provider that provides you with the right amount of dedication, and customization for your brand and products.
You will also have less control over third-party providers. That's because the platform itself will handle third-party integration.
How Do I Add Fulfillment to Shopify?
To use the Shopify Fulfillment Network (SFN), there are specific prerequisites and steps that merchants need to follow. Here’s a detailed overview based on the official Shopify help center SFN checklist:
Prerequisites for Using Shopify Fulfillment Network
- Shopify Store: You must have an active Shopify store. There are no additional requirements or minimum order quantities to get started with SFN.
- Flexport Account: You need to connect your Shopify store to Flexport, Shopify's logistics partner. If you do not have a Flexport account, you can create one using your Facebook, Google, or Shopify account. If you already have an account, you can sign in with your existing credentials.
- Product Registration: Each product you wish to fulfill through SFN must be registered with Shopify. This includes providing a full description of the product, its replacement value, and any specific storage or handling requirements. Products must be approved by Shopify before they can be fulfilled.
- Product Requirements: The products you intend to fulfill must meet Flexport's packaging requirements and must not be on their list of restricted items. Additionally, products must be active in your Shopify store, have a title, and each variant must have a SKU value that does not contain spaces or special characters.
- Inventory Shipping: You are responsible for shipping your inventory to the designated Fulfillment Locations at your cost. This includes all customs, duties, taxes, and other charges associated with inbound shipping.
Understanding how Shopify works is crucial for leveraging its fulfillment features effectively. Now that you’re familiar with Shopify Fulfillment's benefits and components, let’s explore how to implement it in your store.
We will break down the steps on how you can add fulfillment to Shopify:
Step 1. Set Up Your Fulfillment Methods
You have the option of fulfilling your own orders, utilizing Shopify 3rd party fulfillment, or a combination of these methods.
Once you place a product in your online store, you can choose a fulfillment method. Meaning, you could be using various fulfillment methods for product items on the same order.
Step 2. Identify Your Fulfillment Methods
After setting up your order fulfillment methods, the next step is to identify how you will fulfill your orders. You can choose whether to do it manually or automatically.
The setting that you choose will apply to all fulfillment methods. By default, though, your store will be utilizing manual order fulfillment.
To switch to automatic order fulfillment, you are free to configure your order processing settings.
To do so, go to Shopify settings > Shipping and delivery > Custom order fulfillment
Step 3. Assign Fulfillment Methods to Your Products
When you edit or add a product to your online store, you can choose a fulfillment method after completing the "inventory managed by" field. You can see this within the product detail section.
You can also change fulfillment service for multiple products when you use bulk editor.
Refer to Shopify Help Center to more details.
Best Shopify Fulfillment Services
Partnering with a reliable fulfillment service is essential for streamlining your order management and ensuring customer satisfaction. Here are some top Shopify fulfillment services companies that can help you manage your inventory, shipping, and delivery processes efficiently:
ShipBob
- Overview: ShipBob offers end-to-end fulfillment services, including inventory management, order processing, and shipping. They have a network of fulfillment centers across the U.S., Canada, and Europe.
- Features:
- Real-time inventory tracking
- Two-day shipping options
- Easy integration with Shopify
Fulfillment by Amazon (FBA)
- Overview: FBA leverages Amazon’s vast fulfillment network to provide fast and reliable shipping. It integrates seamlessly with Shopify, allowing you to use Amazon’s logistics infrastructure.
- Features:
- Fast and reliable shipping
- Access to Amazon Prime customers
- Inventory management and order tracking
- Link: Fulfillment by Amazon on Shopify App Store
Rakuten Super Logistics
- Overview: Rakuten Super Logistics offers comprehensive fulfillment services, including same-day shipping and advanced order management. They have multiple fulfillment centers across the U.S.
- Features:
- Same-day shipping
- Advanced inventory management
- Integration with Shopify
- Link: Rakuten Super Logistics on Shopify App Store
ShipMonk
- Overview: ShipMonk provides fulfillment services with a focus on automation and scalability. They offer customizable solutions for businesses of all sizes.
- Features:
- Automated order processing
- Real-time inventory management
- Custom packaging and kitting services
- Link: ShipMonk on Shopify App Store
Deliverr (Flexport)
- Overview: Deliverr (Flexport) specializes in fast and affordable fulfillment services, ensuring two-day delivery for most orders. They integrate easily with Shopify and other e-commerce platforms.
- Features:
- Two-day delivery
- Transparent pricing
- Inventory management and analytics
- Link: Deliverr on Shopify App Store
Shopify Fulfillment Network vs Competitors: Which Is the Best Fulfillment Services for Shopify Merchants?
| Fulfillment Solution | Key Features | Advantages | Limitations |
|---|---|---|---|
| Shopify Fulfillment Network (SFN) | - Native Shopify Integration - Predictive Analytics - Real-time Tracking - Custom Fulfillment Services | - Tight Shopify ecosystem integration - Data-driven inventory management - Transparent pricing | - Shopify merchants only - Variable pricing |
| Amazon FBA | - Global Fulfillment Network - Prime Eligibility - Customer-Centric Returns | - Extensive network & brand recognition - Boosts sales with Prime - Simplifies returns & support | - High costs for storage & fulfillment - Limited branding |
| Third-Party Logistics (3PL) | - Platform-Agnostic Support - Custom Fulfillment Strategies - Omnichannel Fulfillment | - High customization - Competitive pricing - Supports multi-channel sales | - Integration may need tools - Varies by provider |
In the world of eCommerce fulfillment, selecting the ideal partner is critical for improving operational efficiency, ensuring scalability, and enhancing the overall customer experience. Shopify Fulfillment Network (SFN), Amazon FBA, and third-party logistics (3PLs) each offer unique features. This section delves into their core differences to help Shopify merchants make informed decisions.
Shopify Fulfillment Network (SFN): Tailored for Shopify Merchants
SFN is a proprietary fulfillment solution designed to work seamlessly with Shopify stores. Here’s what makes it stand out:
- Native Shopify Integration: SFN synchronizes your inventory, orders, and customer data automatically.
- Advanced Inventory Insights: Utilizing machine learning, SFN provides predictive analytics for efficient stock management.
- Custom Fulfillment Services: Includes features like real-time tracking, warehousing, and automated returns management.
- Transparent Pricing Model: Customized based on business size, ensuring fair costs.
Key Advantages:
- Tight integration with Shopify’s ecosystem.
- Data-driven inventory management.
- Enhanced transparency through real-time logistics tracking.
Limitations:
- Restricted to Shopify merchants.
- Variable pricing depending on volume and service customization.
Amazon FBA: A Fulfillment Giant
Amazon FBA is renowned for its expansive reach and efficiency, particularly for merchants heavily reliant on the Amazon marketplace.
- Global Fulfillment Network: Provides access to Amazon’s extensive fulfillment centers and robust shipping capabilities.
- Prime Eligibility: Boosts visibility by making products available for Amazon Prime customers.
- Customer-Centric Returns: Manages refunds, replacements, and shipping logistics for a seamless customer experience.
Key Advantages:
- Extensive global network and brand recognition.
- Boosts sales with Prime access.
- Simplifies customer service and returns.
Limitations:
- Higher costs for storage and fulfillment.
- Limited control over branding and customer interactions.
Shopify Third Party Fulfillment (3PL): Versatile and Customizable
3PL providers, often working as Shopify partners, offer flexible and scalable solutions for merchants selling across multiple platforms, including Shopify.
- Platform-Agnostic Support: Works with diverse eCommerce platforms, enabling omnichannel fulfillment.
- Customized Fulfillment Services: Tailored to meet specific needs, including packaging preferences and shipping strategies.
- Scalable Solutions: Ideal for businesses looking to expand across multiple markets.
Key Advantages:
- High customization options.
- Competitive pricing for small and medium enterprises.
- Supports diverse sales channels.
Limitations:
- Integration processes may require additional tools.
- Quality and reliability depend on the specific provider.
- Choosing the Best Fulfillment Solution
Each fulfillment option has distinct advantages:
- SFN is perfect for Shopify merchants prioritizing seamless integration and data-driven inventory management.
- Amazon FBA suits businesses leveraging Amazon’s marketplace and seeking to benefit from its extensive network.
- 3PL is ideal for merchants requiring flexible, multi-channel fulfillment solutions.
Evaluating these solutions based on your business size, growth goals, and operational needs ensures a fulfillment strategy that aligns with your objectives.
Success Shopify Fulfillment Case Studies & Success Stories
SFN has empowered numerous businesses to enhance their logistics and customer satisfaction. Here are some notable success stories:
Greenery Unlimited: Scaling with SFN
Greenery Unlimited, a Brooklyn-based plant store, faced challenges in managing increased online orders. By partnering with SFN, they achieved:
- Sales Growth: A remarkable 2,000% increase in sales over two years.
- Operational Efficiency: Automated inventory distribution and faster delivery times.
- Customer Satisfaction: Strengthened relationships through reliable, on-time deliveries.
This collaboration allowed Greenery Unlimited to focus on product development and market expansion.
CISE: Managing Explosive Growth
CISE, a fashion brand, experienced rapid growth that strained their fulfillment capabilities. By outsourcing to SFN, they:
- Time Savings: Eliminated the manual effort of shipping hundreds of orders weekly.
- Marketing Focus: Freed up resources to execute impactful campaigns, including a Christmas drop that sold out in eight minutes.
- Scalability: Handled over 1,000 preorders efficiently, with SFN processing them in just a day and a half.
This partnership enabled CISE to maintain momentum and meet customer expectations during peak period
Final Thoughts
Despite being launched recently, the Shopify Fulfillment Network is already showing promising results.
It can significantly reduce the processing and delivery time, decrease the distance between the merchants and their customers, and boost shipping accuracy. As a result, you get to run your business efficiently and effectively.
It also allows you to focus on what matters - and that is making your e-commerce business grow.
Keep in mind that taking your online business to the next level requires ensuring customer satisfaction. And you can achieve this by providing fast and inexpensive shipping to your customers.
This is where Shopify Fulfillment Network could come in handy.
Do you know other ways how SFN can boost your e-commerce business? Let us know in the comments.
