Fulfillment Centers and warehousing
Fulfillment center and fulfillment houses are popular modern terms for a large packing and shipping warehouse. The terms have been coined from the mid-1990s, and presently "fulfillment center" is typically used on an in-house basis. The term "center" describes the space occupied by the company's main production facility, where most of the company's work is carried out. The location of such centers is also based on the location of the company's primary sales offices, to ensure seamless operations between various centers.
The main function of a fulfillment center is to provide a secure, indoor storage area for perishable and/or bulk product, to be moved or stored. This storage area is known as depots, or as an inside stockroom. The company may have several depots, depending on their requirements. The functions of these depots include, storing inventory, receiving shipments, pick and pack orders, and shipping orders. In addition, it also includes receiving returned goods, taking stocks, and issuing refunds.
An ecommerce business requires the ability to locate and store its products, as well as the ability to accept and process orders. These two roles require separate spaces for which to be operated. Most ecommerce businesses utilize a combination of shipping and receiving warehouses, fulfillment companies, pick and pack services, and storage. The fulfillment company is typically the third party that delivers the merchandise to the customer and provides storage for returned goods until they can be returned.
The warehouse, on the other hand, houses the actual products that are being produced and/or delivered to the customer. It is commonly referred to as a receiving area, or a receiving station. It is where the customer places their order for specific items they wish to have. This area is oftentimes provided with extra space by the fulfillment center in order to accommodate any extra products that were received during the process of completing an order. This is a more extensive use of space than that utilized by the warehouse, however, as many businesses that utilize this method of warehousing often find that they exceed the allotted space.
Both the fulfillment center and distribution center play important roles in ecommerce businesses. The distribution centers help to maintain a consistent supply chain by receiving, packing, and then delivering the product to the customer. They may also distribute between different vendors, allowing the retailer to purchase in bulk without having to travel too far. Many wholesalers ship directly to distribution centers, further reducing the distance that is travelled during a sales transaction. Distribution centers, on the other hand, receive the goods that have been picked, packed, and completed, then transport them to the final destination.
The job of the fulfillment company is to warehouse and then ship orders for large quantities of merchandise. They are responsible for keeping adequate inventories on hand to meet the demands of both customers and retailers who frequently ship large quantities of merchandise. Some fulfillment companies are specialized in shipping only certain kinds of merchandise, such as books, while others ship all kinds. The retailer only ships items that they know that they can quickly locate a taker for.
Fulfillment centers need warehouse space to store large quantities of products. The warehouse needs to be large enough to hold all the merchandise that is being produced. A warehouse that is too small will cause the retailer's inventory to increase too quickly, causing the cost of inventory to increase, even if no additional products are purchased to fill the gap. warehouses that are too large also have a negative effect on the speed with which the company can process credit cards and electronic checks.
If the business needs to warehouse and ship merchandise that require special packaging or require extra products to fulfill a request, the fulfillment center might be able to help. The warehouse might package the product for the retailer and drop it off, or it might package and send the order to the company that manufactures and ships the item. Either way, the company needs to know how much space is available and what kind of extra products the retailer needs to warehouse and ship.