Factors To Consider When Selecting A Location For Your Fulfillment Center

Factors To Consider When Selecting A Location For Your Fulfillment Center
by John Carlucci - May 23, 2023

You know what they say in the real estate realm,  location, location, location! This is particularly true when choosing the best site for your fulfillment warehouse. 

Whether you're a large corporation looking for a new fulfillment warehouse or a garage-based eCommerce startup, the location of the fulfillment warehouse (or 3PL, third-party logistic provider) to which you outsource your storage and shipping can significantly impact your business. 

Here are the factors to consider when choosing a location for your fulfillment center.

Your Customers' Location

It's critical to map out where your consumers are based on delivery. Are you servicing consumers in certain cities in the United States, nationwide, or worldwide? We've all experienced the annoyance of waiting a week or more for an order, or even up to a month, for something to arrive from abroad. You want to ensure you're providing your consumers with a better experience.

The location of your consumers is an important consideration when deciding where to locate a fulfillment center.

This is because all courier providers compute shipping charges based on delivery zones. Shipping zones are essential to logistics and order fulfillment since they affect shipment prices, delivery time, and shipping efficiency.

Every delivery company establishes its shipping zones depending on factors such as distance between pickup and destination, regional taxes, etc. These are geographical locations to which carriers carry packages, and they quantify the distance a package travels from its origin to its destination.

The shorter the distance traveled by delivery, the faster it will be delivered to your clients and the less money you will have to spend for shipping.

Do You Require One or Multiple Locations for Your Fulfillment Center?

Choosing a single site for your fulfillment center may make sense if you're starting. However, if your company expands, you may need to expand and ship your product to additional strategically positioned fulfillment centers.

Splitting your goods over various fulfillment center locations offers numerous advantages, the most notable of which is that your purchasers may anticipate next-day delivery. 

Furthermore, you may opt to deliver just certain SKUs to specific locations, and if one fulfillment center runs out of stock, the others will function as backups.

Employing several fulfillment centers to distribute merchandise does not imply employing numerous fulfillment centers. Choosing a single fulfillment center with many locations will aid in unifying systems, technologies, and communication. It contributes to increased service accuracy, openness, and consistency. Click here to check the locations of First Mile fulfillment centers.

Choose a location near major highways and shipping hubs

Choosing a location for your fulfillment center that is accessible to key states and shipping hubs is critical to the success of your company.

Trucks will transport almost every product delivered to your consumer. As a result, it is critical to choose a fulfillment center site that is conveniently accessible from the main roads. It will allow your shipping partner to deliver your items on schedule to your consumers.

Customers nowadays want their purchases to be delivered quickly. Being close to most of your clients or near significant hubs that can reach large numbers of customers guarantees that their purchases arrive as soon as possible.

The Value of Delivery Time

It depends on what you're selling. Unless you're offering a specific clientele with limited alternatives for acquiring things, you must be able to ship promptly. This is particularly true if you sell on Amazon or eBay or compete with them. 

For example, although 6% of customers anticipate domestic products like toilet paper to arrive within 24 hours, approximately 1% expect apparel or gadgets to come within that time frame. Most clients prefer their package to take three days or fewer. 

The Value of Free Shipping

Nobody likes to pay for shipping. The majority of US customers indicated free delivery was the most significant aspect of their online purchase choices. 

Of course, you want to avoid incurring significant expenditures only to give free delivery, which means multiple 3PL plans may be in order. This is because UPS and FedEx base their shipping prices mostly on zones; the longer the distance between your fulfillment facility and your consumer, the more zones you'll have to travel and pay for. 

Packaging

For many eCommerce merchants, the first tactile encounter your consumers will have with your brand is when the delivery comes at their door—and a damaged, brown box wrapped in shambles of tape isn't going to make a positive first impression. 

When selecting a fulfillment center, evaluate its ability to provide personalized packaging, which increases brand identification, produces devoted brand supporters, and tailors the consumer experience. 

Inventory Control Capability 

You must examine your inventory management skills and your capacity to plan to ensure that your items are where they need to be—when they need to be. 

For example, if you sell ponchos, you want them to be kept from being warehoused in the southern states during the winter months; the majority of orders will most likely come from the north. Inventory management software can assist you in documenting the seasonality of sales and more to avoid shipping inventory in bulk from one fulfillment center to another. However, it's worth noting that in these cases, the cost of shipping oversized pallets across the country is still more than offset by what you can save on shipping individual items from far-away fulfillment centers).

The eCommerce industry has grown more competitive, with one seller attempting to outperform the next by offering speedier delivery dates, free shipping, innovative packaging, and other benefits. We built fulfillment marketing to answer a growing need—and to assure you receive outstanding customer ratings. It includes quicker shipment, order transparency, and comprehensive customization.

Please take the time to carefully plan and comprehend the best warehouse location for you and your clients. This action has far-reaching consequences beyond just having a fulfillment center someplace. The location of your center will have long-term effects on the company's financial, operational, and competitive aspects.

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