The Benefits of Working With A Fulfillment Network Partner
A partner with a fulfillment network is someone you can engage to deliver for a component of your overall supply chain. Is it the right option for your business? Learn more about the benefits and some of the key details in our latest blog.
Key Takeaways:
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A supply chain fulfillment network partner provides you with pre-vetted partners who can work together to deliver your product.
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This allows you a greater ability to focus on your business, scalability, flexibility, cost efficiency, and customer satisfaction.
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While a network offers incredible efficiencies, the final decisions always rest with your business.
What Is A Supply Chain Network?
A supply chain network offers the ability to fulfill your orders on a much wider scale, without requiring you to manage everything directly. You gain access to a network of pre-vetted warehouse and transportation partners.
In a leading tech-enabled supply chain network, all data will be collected and reported to you in real-time, in a unified platform. Having comprehensive data in a central source of truth enables effective planning and decision-making. In addition to data-driven insights, your team works with an account manager who provides consistent customer care and ensures that work is done in trust with your business.
For the purposes of this blog, we’ll be zeroing in on the fulfillment aspect of supply chain networks. For those wanting to learn about the pros and cons of various approaches to fulfillment, you’ll find us comparing the concept of a supply chain fulfillment network to two other popular options:
- Managing and building everything on your own (including warehouses and transportation).
- Working with a number of 3PL partners, for example, distributions in various regions, carriers like FedEx, and more.
What Are The Benefits of A Supply Chain Network?
Working with a supply chain network provider gives you oversight and visibility into your fulfillment, but without having to manage it yourself. For smaller to mid-size businesses and enterprises alike, this helps provide you with many benefits.
Focus
Creating or expanding a network can be a time-consuming process. Often, this can require an entire team to manage. Small businesses and medium enterprises alike may often find that outsourcing fulfillment to a pre-vetted network enables them to better focus their efforts on product development, sales, and marketing.
Scalability
Working with a pre-vetted network with warehouse and transport solutions in different geographical markets also allows you to scale out more rapidly and efficiently compared to managing your distribution network entirely in-house or vetting partners and building a network yourself.
Flexibility and Agility
In addition to the fact that working with a partner allows you to scale at your own pace, the fact that there is less overhead associated with expanding into new markets allows you greater flexibility.
For example, if you partner with a network that offers extremely granular Cubic Foot Model Pricing, you could start shipping just a few cases into your new market, and re-evaluate after a few months. Or, if one warehouse in a city does not have storage space, your network provider will often have another option or distribution center available.
Additionally, a tech-enabled fulfillment network also makes it easier to be proactive. For example, if data shows that deliveries between Vancouver and Calgary are often delayed due to roads being compromised in the winter, your account manager may suggest keeping slightly more goods on hand in a Calgary distribution center during that time of year, and be able to manage this change for you.
Cost Efficiency
Working with a supply chain network partner for your fulfillment, especially one that uses pricing like the Cubic Foot Model rather than per-pallet rate, offers businesses with fast-turning inventory greater cost efficiency.
Customer Care And Consistency
One thing that businesses might not consider when deciding between building out their own network, handling everything themselves, or working with a network partner is customer care.
Customer experience, now more than ever, is a differentiating factor. If you are managing your own warehousing and transportation, or working with separate 3PL partners, this means you will have to train all of your own warehouse and delivery staff, or manage and vet individual 3PL partners to ensure that they deliver the caliber of service you want to provide. This reality can mean heavy overhead and effort are required on your end at best, or inconsistent customer service at worst.
Software Synchronization
If you are managing fulfillment entirely in-house, you will likely need to choose and implement software and integrations across your network and train your team to use it. If you are piecing together your own network of 3PLs, you may find that they all use different software solutions, or have different standard operating procedures in effect for reporting. This will require integration and centralization within your organization.
The Flow Of Products In A Supply Chain Fulfillment Network
How does our fulfillment network actually work, and why is it so efficient? We believe it is due to the ability both to optimize your deliveries, and more easily plan and forecast.
Optimization
Using customer, order, and product data, as well as technology including AI/ML algorithms, we determine, based on the partners we have on board, the location, capacity requirements (such as whether the product is frozen) and more, the best way to have products flow.
“Taking a look at a large complex network, it’s important to have a methodology for routing orders and inventory to the right partner, based on customer locations and delivery requirements,” says Kaitlin Mercier, VP of Partnerships. “This needs to be revisited regularly and optimized as networks grow and evolve.”
Forecasting and Visibility
At Routeique, we also use the insights collected and reported by our technology to help forecast how much product should be held at a warehouse. “We can help pull this information, or clients can use [Routeique’s tools], so they’re not left with expired products or shorting orders,” says Sari Waldman, VP of Client Success, “a client still gets the final say and control, but we have data and tools to help make recommendations on managing that flow.”
Your Role When Working With Supply Chain Network Partners
While network partners take a significant amount of work off your plate by managing the day-to-day fulfillment and providing you with powerful, data-driven insights, there are still things that you need to cover.
This includes making the final call in terms of things like product quantities, as well as decisions about your broad network, such as which regions to expand into. And as with any supply chain partner, you have to be ready to work together with your account manager to ensure your business’ success.
The Future of Tech-Driven Supply Chain Networks
Increasing Automation
We see the role of AI and technology in the supply chain as moving from descriptive to predictive. The descriptive phase is simply having data that accurately describes what is going on in your supply chain. While this may seem simple, we find that presently, many organizations, 3PLs, or supply chain service providers are not necessarily even in this phase.
The next step is to have tools that help you predict and recommend what might be required. The final step is to have AI-driven tools that take the steps required with minimal intervention. At Routeique, we’re working towards this step by investing in cutting-edge Machine Learning and Generative AI technologies.
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