Lack of sufficient knowledge drives people to believe that fulfillment and transportation companies are the same. Even I would admit making errors in reference before I was assigned to write about this blog. I had ideas about these companies but never knew about their significant differences.
Initially, what I knew was that an order fulfillment company is any third-party individual or group who takes care of storage, packing, and sending out orders, while a transportation company is the one who takes care of shipping and handling, literally. Even as I work in B2B selling in the past, these things didn’t matter, until now.
If you happen to be on the same level of understanding, please continue reading. I’ve made a list of four key differences between these two companies.
1. Order Fulfillment Company
An order fulfillment firm takes care of processing customers orders from receiving inventory to shipping. When a business owner gets too busy with the development of his enterprise, he can opt to hire a third-party company that can take care of his customers’ orders on his behalf. While this can be very convenient on the entrepreneur’s part, there are still some things that he should remember.
Order fulfillment only starts from the receipt of inventory. Thus, it is still the business owner’s responsibility to send his supplies in bulk to the fulfillment center and to inform the company of any orders needing to be shipped.
2. Transportation Companies
Often regarded as freight companies refer to those businesses that specialize in the “forwarding” of products from one location to another, and have different departments or sections. However valuable transporting goods may be, it only serves a function in the whole order fulfillment process.
The primary goal of any transportation company is to deliver goods from point A to point B on time. For international shipments, a business owner can opt to have the customs clearance processed by his hired transportation company or through his preferred agent.
3. The Size Issue
The shipping industry often categorizes transportation companies as either TL or LTL. The term TL refers to a full truckload ranging between 7.62m and 15.24m long. To save up on these deliveries, a shipper must consume the whole truck space.
LTL refers to “less than truckload” which consists of relatively small cargo that does not fill up the entire delivery truck. SMEs who rely on LTL companies can save up money with shipping costs. Since a shipment only takes a few space on the delivery vehicle, the transportation company may share the truck between several shippers, which can lead to a longer wait time.
4. The Bigger Picture
Order fulfillment companies are the ones responsible for the satisfaction of any online seller’s customer base. While their jobs start with the receipt of a business owner’s inventory, they also serve multiple functions to tag an order complete.
They handle warehousing, packing, security, delivery, and at times, the refund process. E-commerce websites have extremely useful applications that allow integration between orders and fulfillment, which makes it easier for both the business owner and the centers to send the right package to the right receivers at the right time.
Taking advantage of these third-party companies are ideal for business people who have vast amounts of orders to be handled frequently. h While services are convenient and efficient, smaller firms may not benefit much cosidering the costs.
That concludes my comparison and contrast between transportation and order fulfillment companies. I hope this clarifies any misinformation about these terms we often interchange.