The concept of using Fulfilment Houses for an eCommerce business may not be new BUT after the Royal Mail price update on 2nd April this year, using a Fulfilment House may be the ONLY way to survive for many small time eBay sellers.
My Hermes is already a good alternative to Royal Mail and cheaper in many price ranges but what if you still want to offer TRUE Courier delivery service for your customers?
Royal Mail’s new prices for packages are not competitive at all. For many eBay traders this can be a business killer especially in Autumn, when new TRS requirements kick in asking you to provide at least one FREE shipping option.
That’s why this is a perfect time to look for Royal Mail alternatives. I have briefly covered the concept of Fulfilment Houses in one of my previous blog posts but today, I invited Scott McGinley (email@example.com) from Dalepak Ltd., to share his story and explain what benefits small time eBay traders can expect from services provided by Dalepak Ltd.:
Scott McGinley, Dalepak Ltd.
At the end of 2012 I left play.com to join Dalepak Logistics, one of things I noticed when at play was that Merchants have thriving businesses but their Supply Chain and Logistics can hinder growth, I also saw that with the services and costs that companies like Amazon enjoy that the smaller business was struggling to compete broadly and were being confined to mostly a Niche market.
So I had a look at the Market:
Obviously there is FBA – however my personal opinion is that although a fantastic service, it is very rigid for Smaller Traders and does not give the flexibility that smaller traders need to maximise profit to enable their growth. There are also many rules and regulations and charges can be expensive.
The large 3PL’s – DHL (a former employee of mine) and Wincanton are the two biggest players within this market, however their infrastructure is more aligned to the bigger High Street players as they combine B2B with their B2C activities, in these businesses there is generally high start-up costs and administration charges, also you need to have a lot of volume for you to be viable.
There are also many small B2C companies who do a great job for a great price, Bray Solutions being one of these businesses, great price and great service but are they able to offer the Industry leading services – not in the main.
So I worked with the guys at Dalepak and we created The Dalepak Merchant Marketplace Model, a flexible low cost logistics solution that allows smaller traders the ability to concentrate on core business and leave the fulfilment to us. It also allows traders to enjoy the services usually reserved for larger businesses.
We are fully flexible with 340,000 square foot of warehousing over 3 Distribution Centres based in Northampton, we have small and large customers – some customers were delivering us 3000 orders per day through peak and we managed this smoothly.
IntrigueBoutique.com are a small but interesting online retailer, they sell via their own website/EBay and Amazon – they came to see us in January to look at their Fulfilment needs.
Products they sell are Fashion items and accessories – I did a full Supply Chain analysis and looked at what they were using currently and what costs would be utilising our fulfilment services.
Well it was a great result, looking at their carrier options now compared to what we could offer, we could receive the product, store it, pick and pack orders and deliver them for circa £1 less per order than currently happens, we also improved their service by offering later cut off times – gift wrapping options for their customers.
IntrigueBoutique.com now have increased their offering and saved money in the process, also they now have the scalability to grow their business further.
Why Use DMMM©?
Designed for Merchants who sell through E-Commerce Market place platforms, coupled with the ability to hold their B2B stock in one central location.
- No IT Start-up costs
- No infrastructure costs
- But with access to competitive pricing and value added customisation services
- Ability to utilise industry leading services such as:-
- Same day delivery
- Access EU Marketplace through our partnership with Neteven
- Local Collect
- Carrier Rates
- Next Day
Designed for E-Commerce Retailers who wish to offer extended ranges of products and customised services:
- Without the need to invest in long term warehouse leases.
- Unrivalled Returns Management
• Allows for products to be customised in line with retail requirements on inbound or outbound
• Access to experienced workforce specialising in logistics services
• No commitment to own facility and infrastructure
• Scalable stock holding provision
• Enables depth of range to be offered
• Access to investment in technology and machinery
• Synergy around packaging and transport costs
• Access to sophisticated reporting and tracking services
• Ability to offer Enhanced service propositions from website
Below I have added some example of carrier prices when a new client switches to DMMM©
These are carrier only – handling we base on individual product as a one size fits all does not work for all traders. This is only a selection of prices – again when a trader switches to DMMM© the carrier type is based on weight and dimensions to ensure the lowest possible rate for the service specified.
Don’t forget that it’s not only about shipping prices we’re talking about here! By using a Fulfilment House you effectively outsource all tasks related to goods storage, order picking/packing and dispatching hence allowing you to spend more time on growing your business (instead of processing orders). Remember, having an online business is your ultimate goal, not having an online job!
In my opinion, switching to a Fulfilment House altogether OR using My Hermes are really the ONLY alternatives to Royal Mail currently.
Feel free to get in touch with Scott directly to find out how Dalepak can help your business save money in shipping fees and free up your time from order processing tasks.