Biz Miss

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Finding Somone Who Fulfills Your Needs (Part 1) April 5, 2008

When I first started thinking about contracting out the sewing of my Sweet Meats, I had it all planned out in my head. I would rent a large truck for the day, pick up my cargo at the Oakland docks, and bring it all home. At first, there would be a lot of boxes in the living room, but the orders from Bay Area stores would put a serious dent in my inventory when I delivered them all the next day. Then, slowly but surely, the living room would empty out as I sold out of all my stock within the next two months. Sure, it would take some time to fill all those orders myself, but since I would be getting paid for the “handling,” it was ultimately a smart move financially.

These daydreams of mine were not based on any real estimates of time, space or money, however, so they quickly evaporated when the hard numbers came in.

First I tried to find out how much space my cargo would actually take up. All along, I had been hearing that it made up less than a full container. I guessed that that meant it took up about half of the 20ft. container they were due to ship in. Assuming the container is also 10′ high and 10′ wide, this meant boxes of plush meats would take up our entire living room–not an option, according to my fiancé. Okay, so keeping them in the apartment was out, but I could presumably fit my boxes in a 10’x10′ storage unit, which rents around here for $150-200/month–not too bad, plus it would be kind of nice to have a dedicated shipping center outside of the house. Again, I assumed several boxes would go out immediately, which would leave some maneuvering room.

But wait. How was I going to fill these orders in a storage unit? Would there be a way I could connect to the Internet to print out shipping labels? Would the postal service pick them up from such a place? Was I going to have to order a really large, expensive scale? A new printer? Cartons of boxes in tons of different sizes? Was I willing to drive 10-15 minutes each direction several times a week and drive my orders to the post office? How much would that cost in gasoline? Would I have time for anything else on those days? I suddenly started feeling overwhelmed by the possibilities I could see and could not yet see. It was time to consider a fulfillment house.

A fulfillment house is a warehouse that holds your goods and ships them to customers. Most of them also offer special packaging and design services, but the advantage to hiring a fulfillment house lies mainly in not having to worry about supplies and logistics. For example, they have accounts with all of the major shipping companies and usually get much better rates than your average business due to volume. Fulfillment houses also have computerized systems in place for weighing and addressing your packages, and for keeping track of inventory. They have all of the packing materials already on hand, which they will usually offer at cost + 10-15%. All of the fulfillment houses I spoke to were also willing to let me use leftover packaging they already had on hand for free.

It was difficult at first for me to get used to the idea of letting someone else take over the shipping and handling of my products. After all, it is a crucial part of customer service and accounting, and if it were handled badly I could have some really big problems–angry or lost customers, incorrect inventory, or damaged or missing merchandise. But part of being a successful business owner is knowing how to prioritize your two biggest resources–time and money. I didn’t start a business to become a shipping clerk, so I’m comfortable with my decision to let someone else take that over for me so I can focus on more lucrative, long-term things like product development and opening new accounts.

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