Subscription box companies are a hit with consumers. In 2018, there were ten subscription box companies and related services among the fastest-growing private U.S. companies. Today, according to Chris George, chairman of the board of the Subscription Trade Association, there are more than 5,000 subscription-type businesses.
Right now the companies that move faster and at a higher level will be the ones that succeed. In a recent article on Inc.com, ‘3 Trendy Companies Have Perfected the Subscription Business Model’ writer, Aleanna Siacon says, “The big challenge for most subscription services now is differentiating from Amazon, and the best companies do it with a great customer experience.”
But how are the leading subscription box businesses offering truly great customer service? In other words, how are these ecommerce companies able to fulfill orders accurately, on-time, offer the best shipping and returns policies, and at the same time provide a truly unique unboxing experience? Answer- they outsource their ecommerce fulfillment to a third party logistics provider (3PL).
Benefits of working with a 3PL:
- The best shipping rates! Most top 3PLs have negotiated freight rates with major and regional carriers. These discounts allow brands to offer free or low cost shipping options to customers and not take a major hit to their margins.
- Faster shipping options! Automated order fulfillment means brands can offer expedited processing and delivery to their customers. For example, an experienced 3PL can provide same day shipping and same or next day delivery. That’s fast!
- Maximize brand experience! A quality 3PL that also offers contract or specialty packaging services will help identify package design that is both brand appropriate and maximizes savings on shipping costs. The value added services provided by a specialty packaging team mean a truly customized and memorable unboxing experience for consumers.
- Ability to efficiently scale up and down with demand. The processes utilized by top 3PLs have been developed with scalability in mind. Many factors influence demand including seasonality (the holidays), special promotions, and a product’s popularity. Brands should work with a 3PL that has a proven system for efficiently and cost effectively handling increases or decreases in order volume.
- Easy and efficient returns processing! Returns processing– when a product is returned to the manufacturer or provider by the recipient, is part of what 3PL’s call reverse logistics. Having processes in place to efficiently manage returns is a large (though less glamorous) part of the fulfillment process. When planning the customer experience, the best companies know that the more flexible they can be with this policy and the simpler they can make the process the better. Reverse logistics can also include refurbishment, repair, and re-manufacturing services to help reduce operating costs and eliminate high levels of waste by extending the useful life of products.
- Easy integrations! A 3PL should offer simple integrations with brands online shopping carts such as magento, shopify, woocommerce, etc. These integrations link brands to the providers dedicated warehouse management systems to accurately execute across inventory, labor, and space. This automation supports on-time shipping and inventory accuracy rates while saving brands money.
- Regulations and requirements! Some cosmetics, health and wellness supplements, nutraceuticals, food and beverages, and medical or healthcare related products have strict storage, handling, and packaging requirements. A qualified 3PL complies with all applicable regulations and can save brands expensive fines and even recall fees. In addition, brands should look for 3Pls that provide internal quality control services and operate in facilities meeting FDA certification qualifications.
Have a great idea for a subscription box business? Want to provide the best customer service? Consider the benefits of working with a 3PL from the beginning.
LEARN MORE: If you’re looking for a new fulfillment partner, contact the experts at The Jay Group. The Jay Group has been an industry leading 3PL provider since 1965. Today, top companies and ecommerce retailers rely on The Jay Group’s experience, customer focus, and enterprise level technology solutions to deliver the best possible experience to their customers.