Understanding Your Fulfillment Center's Policies - Know What You're Getting

All fulfillment houses are not equal. If you're contemplating outsourcing your fulfillment, you should familiarize yourself with a firm's policies and procedures, and carefully read the terms in the agreement they provide, before making any decisions. "It's important to understand a provider's capabilities and limitations," advises Joe Walowski, Senior Project Manager of AmazonServices.com/fulfillment. "Compare those factors with your own eBiz needs, so you can identify the best match for your business."

Quick Question Checklist
Before you begin your search, make sure you have a clear understanding of what your provider requirements are. What functions are you looking to outsource - just the warehousing and inventory control? Or do you want your firm to be the frontline for customer service, as well? Knowing exactly what you need will make it easier to recognize the right firm for the job. The following are some of those key issues you need to cover with each house:

. Return policies. Ask how your potential firm handles returns, what their policies are for accepting them, and what your role is in the process. If your customers ever need to return an item, you want to know that they'll have a pleasant experience doing so.

. Degree of visibility. Find out what tools the firm will provide to effectively manage your inventory. From giving you access to real-time info on your stock levels to sending reorder alerts when your SKUs reach a certain level, you're looking for a firm that offers a high degree of visibility.

. Sales channel integration. You need to know that your fulfillment house is able to seamlessly integrate with the sales platform or platforms that you sell on.

. Restrictions. Not every firm accepts every type of product. Most aren't equipped to store hazardous materials or perishable goods, and many don't handle large, bulky items. If your products have special requirements, you want to make sure that won't pose a problem.

. Areas of specialization. Many houses specialize in fulfillment of specific types of goods, like media products, or products requiring installation, special storage or lot tracking. Even general fulfillment houses tend to have a sweet spot or "niche" in which they excel, such as items that call for preparation or kitting. You want to find a house that's well-equipped to handle your particular inventory.

. Data transfer methods. When it comes to getting your orders to your fulfillment provider, there is a huge spectrum of options. Look for a fulfillment house that can receive your information using the method that works best for you. For instance, if your order system is capable of outputting in XML markup language, you may want to find a firm with a compatible system, so your respective order systems can directly share your order data.

Many fulfillment houses have web sites where you can find a copy of their standard client agreements. Study a company's agreement template before you contact them, to avoid wasting their time - and yours. Once you've read their terms carefully, make a list of any questions you still have, so you don't forget to ask anything important once you reach them. States Walowski, "Asking the right questions will help you find a house that's well-suited to your online business - and that's important because having a good service provider can really enhance your online business."