Order fulfillment is not the most glamorous part of running an eCommerce business, especially with retail giants and services offering free 2-day delivery. The bar for fast, free delivery has been set high, and businesses that cannot streamline their fulfillment process face the risk of closure.
However, fulfillment is often a convoluted process that encompasses complex procedures throughout the supply chain; and these procedures always end up defining how clients view a business.
In a study of 2,000 US shoppers by Avarto, more than half (54%) of shoppers abandoned an online purchase because delivery was costly. The majority (83%) prioritized free delivery as the most crucial factor when considering online order fulfillment while 53% valued the speed of delivery. In fact, out of the 2000 shoppers, 25% had canceled their orders because delivery was too slow for their needs.
Let’s focus on the fulfillment process of one of the biggest eCommerce platforms, Shopify. Fulfilling orders on Shopify can be daunting for new sellers, since the typical Shopify fulfillment process is made up of various moving pieces.
We will highlight the most important aspects of fulfillment for Shopify to help everyone from new to veteran Shopify sellers looking to take their business to the next level.
3 Ways to Fulfill Your Shopify Orders
Based on the needs of your Shopify store, Shopify has three different options you can use to fulfill the orders you receive:
- Automatic order fulfillment
- Manual order fulfillment
- Partial order fulfillment
1. Automatic Order Fulfillment
Automatic order fulfillment means you don’t have to sit in front of your computer when you receive an order – because the fulfillment process is automated. This process only makes sense if:
- You are using a Third Party fulfillment service
- Your sales do not require packing and shipping. For example, digital downloads
- You do not have any items available for pre-order
2. Manual Order Fulfillment
Manual order fulfillment makes sense for most stores, as it gives them control and the ability to monitor their inventory levels.
When going for the manual order fulfillment feature, ensure you have not selected “Automatic fulfillment under the “Order Processing” section. Manually fulfilling orders allows the seller to be more involved in the ordering and shipping process.
Consider manual fulfillment if:
- You occasionally run out of stock
- You have products for pre-order
- You produce goods to order
- You want to offer your shoppers partial fulfillment
With manual order fulfillment, you will be prompted to send out a notification email to the client as an alert that goods have been shipped.
When completing an order manually, go to Orders to see the order fulfillment status of your orders. The orders that are unfulfilled will show “Unfulfilled” under Fulfillment status.
Open the order number to see the order details then click Start fulfilling to open the order’s Fulfillment page. You will then have to input the order tracking number provided to you by the carrier.
Shopify should identify the tracking details and pick a fulfillment provider. In case Shopify fails to identify your carrier, select one from the menu.
By default, Shopify will notify the customer of the shipment by sending an email immediately.
Finally, complete the process by clicking Fulfill items.
A typical manual order fulfillment process
Part of an Order
Some customers make an order for multiple items and make payment; however, one or more of the items may be a pre-order or out of stock. Therefore, you will only fulfill part of the order (using the procedure described above) by sending out the contents differently.
Orders for Several Locations
There are instances where a client orders for multiple items and pays for them, but the item/items in question are stored at different warehouses.
In this scenario, the seller will have to manually fulfill parts of the order independently, and this will be based on the site of the stock.
Sellers can configure location priorities to manipulate the priority sequence. The maximum number of locations you can set depends on your plan.
Many Orders at Once
You can fulfill multiple orders at once by selecting them all and manually fulfilling them.
3. Partial Order Fulfillment
There are instances where a customer has placed an order for multiple products, and one or more of the items in question are out of stock or a pre-order. For example, when you receive an order for a product that is out of stock or on pre-order, yet the buyer has already paid for multiple products; most of which you already have.
You will then be left to fulfill part of the order by sending your Shopify items separately.
Fulfilling Many Orders at Once Manually
Shopify also enables a merchant to fulfill bulk or multiple orders using the same procedures described above. This is through the “bulk actions” feature. This feature is helpful when a customer has placed numerous orders or if there is a queue of orders that are ready to be shipped.
Fulfilling orders for several locations
Then there are cases where a client has placed orders for multiple products and has already paid. But one or more of the items in question are stocked at different locations. In this case, you will fulfill parts of the order separately based on the location of your stock. Start by Setting location priorities.
Canceling a Fulfillment
Pending orders can sometimes be canceled, and if the termination is not from your side, then you should always have a resolution ready.
Choosing your Shopify fulfillment strategies
By the time you visit the Orders page on your Shopify admin, you should have already established the shipping strategy you are going to use.
- Handle shipping yourself – You can choose to ship from your home, and either handle labels yourself or automate the process. You can choose between taking your items to the post office, or having them picked up by a courier.
- Outsource your fulfillment – Work with a fulfillment partner to store, ship, and track your packages. They will get a notice when an order has been placed and will take care of the fulfillment process from there.
- Dropship – After an order comes in, it goes directly to your supplier or dropship partner, and they send it directly to the customer. That means you don’t have to worry about inventory at all.
Both dropshipping and third-party fulfillment rely on a fulfillment service, and, therefore, all the fulfillment work is done on your behalf. Self-fulfillment, however, requires that you fulfill orders yourself without the assistance of an outside party.
You must take care of all the technicalities that are involved in deciding the fulfillment cost, packaging, and shipping. Let’s look at these procedures in detail.
How to Calculate Fulfillment Costs
When deciding your shipping rates for Shopify, you have the following options:
- Free delivery – You can have free delivery on all the orders – by incorporating the delivery fee in your product price. Alternatively, you can have free delivery rules. For example, you can only have free delivery on orders exceeding $100. Free delivery is proven to get the buyer’s attention.
- Flat rate delivery – Have a fixed rate for delivery based on the weight, destination, or value of the order. For example, charge $6 for all domestic shipments. When considering a flat rate fee, make sure you do not undercharge or overcharge.
- Exact cost – Charge customers whatever carries charge to ship (real-time rates). Sellers in the U.S or Canada can use Shopify Shipping to provide calculated shipping rates. Using exact fulfillment cost is the best way to reduce costs if you are a small business, and especially if you are starting out.
Set Your Shopify Shipping Rates
You must set a price for shipping, and your choice must be informed by several factors around your Shopify store. Keep in mind that extra costs (shipping, tax, fees) are the leading cause of abandonment during checkout. These shipping rates are what buyers will see on your eCommerce website.
As a Shopify seller, you have the following options:
1) Offer Free Shipping
One of the best ways to minimize shopping cart abandonment is by offering free shipping. You can achieve this by:
- Covering the full cost of shipping yourself.
- Sharing the shipping cost with your customer by slightly increasing your item prices.
- Pass the shipping cost to your customer by increasing product price to cover shipping in full.
- Require a minimum order to offer free shipping. For example, only provide free shipping for orders exceeding $200. This method will offset the shipping costs by increasing your order value, even though you will still cover all shipping costs.
- Use a discount code to provide free shipping to specific customers.
While free shipping is a shopper’s magnet, it is mostly viable for domestic orders.
2) Offer a Flat Rate
The last option is offering a flat rate for shipping. This system will work best when you have standard items that are similar in size and weight. The price can be based on the destination, weight, or value of your order. Be careful not to overcharge or undercharge by first figuring out your average shipping costs per package.
A flat rate fee is ineffective if you are dealing with a variety of products with different sizes and weights.
3) Charge Real-Time Carrier Rates
Shopify integrates with carriers like Canada Post and USPS to provide real-time shipping rates, and the live pricing charges customers what you get charged by carriers.
Eligible merchants based in the United States or Canada can make use of Shopify Shipping to display calculated shipping rates on their eCommerce websites.
Shipping carriers base shipping rates on factors like:
- Origin country
- Additional options like insurance and tracking
Here are example rates with Shopify Shipping that should be displayed on your eCommerce website.
While deciding on the cost, keep in mind that unexpected costs are the main contributor to incomplete purchases. Customers don’t want to be presented with additional fees at the checkout, and you should make your shipping costs as clear as possible to avoid any surprises.
Overall, you want to balance the shipping and handling costs with pricing. Therefore, you must optimize your shipping rates for Shopify based on weights, packaging, and value.
Shipping and delivery
Your other crucial task will be picking the shipping courier you are going to partner with. Since the courier is going to be a business partner, pick someone who can better represent your brand and business. Here are a few options you have for shipping and delivery.
1) Fulfillment within Shopify
Setting up fulfillment within your Shopify Admin is called Shopify Shipping. With Shopify Shipping, you get discounted shipping rates on several carriers, have the ability to print your own shipping labels, and access to other shipping tools like return labels. and can print shipping labels direct from the Shopify admin.
To print shipping labels, you need to select “Buy shipping label” from the fulfillment screen. You will then pick your box size and shipping method and shipping costs will be based on your item weight, box size, and the shipping method.
Anyone residing within the United States can print USPS, UPS, and DHL shipping labels within Shopify, and the enjoy the services of Shopify Shipping. And you don’t need special equipment to print the labels; you are good to go with a regular printer and some clear packing tape. Shopify even has a hardware store for those who want to buy supplies, especially those looking to ship dozens of packages.
When you are ready to ship, stick the label on your package and drop it at the nearest USPS office or schedule a pickup. You will skip the line because your package will be ready to ship. You can choose your shipping method by either scheduling a free home or office pickup if you have at least one priority package.
With Shopify Shipping, you get the chance to buy and print multiple shipping labels at once when your order is ready for fulfillment.
2) Fulfillment outside Shopify
Carriers are aplenty, and you need to know which one suits your interests. Carriers have shipping rates based on several variables, ranging from destination country, insurance, tracking, weight, and size.
You will have to conduct extensive research when looking for a carrier. For example, you may probably want to consider a carrier with package insurance and package tracking if you are selling high-value items.
3) Fulfillment with Deliverr
Deliverr is an outsourced fulfillment solution that integrates directly with Shopify. With a focus on fast fulfillment that will delight your customers, transparent pricing, and a 2-minute onboarding process, Deliverr is the key to streamlining an efficient fulfillment process for your Shopify store.
To calculate what your costs would be, visit our fulfillment cost calculator.
Finally, have a method in place for processing a returned order. Depending on how you run your Shopify store, the order may be shipped back to you,the fulfillment center, or the wholesale distributor. Depending on the reason for return, quality of the item, and your return policy, the returned item can be disposed or restocked as available inventory.
How you should fulfill orders will largely depend upon the needs of your Shopify store. There is always an order fulfillment method that will delight your buyers, and save your business time and money. And before you mark your orders as fulfilled, never forget to perform order checks. They are meant to confirm accuracy before you pack and ship. Order checks can also detect fraud before goods are dispatched.
Offering 2-day delivery with Deliverr
Outsourced fulfillment services help you avoid headaches when dealing with stock and ensuring delivery times, giving you more time to run your store. By default, three services appear on the seller’s Shipping settings, but sellers can also use custom eCommerce fulfillment services.
Shopify allows sellers to use other eCommerce fulfillment services as long as the warehouse you pick can process orders by email. However, if more contact is needed, a custom app can be developed through Shopify Expert API developer.
Deliverr is an outsourced fulfillment solution that integrates directly with Shopify to offer nationwide 2-day delivery. The onboarding process takes 2 minutes, and we have transparent, all-inclusive pricing.
Sellers can use Deliverr to ensure fast, efficient delivery for all of their items; from order to doorstep.
When it comes to delighting your buyers and generating loyal customers, fulfillment is vital. Seamless fulfillment is a must, and fast fulfillment will help your own store compete with eCommerce giants such as Amazon and eBay. We hope this guide will help you navigate your Shopify fulfillment process, and help you choose the best option for your business.