In the fast-paced world of e-commerce, the terms ‘shipping’ and ‘fulfilment’ play pivotal roles. However, they are not synonymous and understanding their distinctions is crucial for any business owner looking to optimise their supply chain. This blog aims to demystify these terms by outlining their specific functions and exploring how they impact your operations.
What is Fulfilment?
Fulfilment refers to the entire process of handling and processing orders within the warehouse. This includes everything from receiving and storing inventory to picking, packing, and preparing orders for shipment. Fulfilment is the backbone of the order processing system, ensuring that your products are ready to be shipped to the customer as soon as a purchase is made.
Key Components of Fulfilment:
- Inventory Management: Effective stock control ensures that products are available when customers place orders, avoiding stockouts and overstock situations.
- Order Processing: This involves picking the correct items from the warehouse, packing them securely, and preparing them for dispatch.
- Returns Management: Handling returns efficiently is also a part of fulfilment, requiring a process for receiving, restocking, and processing refunds or exchanges.
What is Shipping?
Shipping, on the other hand, specifically refers to the process of transporting an order from your warehouse to the customer’s doorstep. It involves selecting carriers, scheduling pickups, managing shipping documents and insurance, and ensuring the delivery is completed within the expected timeframe.
Key Aspects of Shipping:
- Carrier Selection: Choosing the right carrier based on factors such as cost, delivery speed, and service quality.
- Logistics Management: Coordinating the movement of goods from one location to another efficiently.
- Customer Communication: Keeping the customer informed about their order status through tracking numbers and delivery updates.
What is the difference between shipping and fulfilment?
Let’s take a look at some key differences:
| Aspect | Fulfilment | Shipping |
| Definition | The process involved in receiving, processing, and preparing orders for shipment. | The process of transporting an order from the warehouse to the customer’s doorstep. |
| Key Activities | – Inventory management
– Order picking and packing – Returns processing |
– Choosing carriers
– Managing transit times and costs – Providing tracking information |
| Focus | Efficient internal warehouse operations and handling of goods. | Timely and cost-effective delivery of goods to customers. |
| Tools Used | Warehouse management systems (WMS), barcode scanners, packing stations. | Shipping software, logistics management platforms, tracking systems. |
| Outcome | Orders are correctly packaged and ready for dispatch. | Orders are successfully delivered to customers. |
| Impact on Customer Experience | Ensures that the correct items are sent and well-packaged. | Directly affects the speed of delivery and condition of the items upon arrival. |
| Cost Considerations | Costs associated with storage, labour, and warehouse operations. | Costs related to transport, carrier fees, and handling. |
| Performance Measurement | Efficiency of picking and packing processes, accuracy of inventory counts. | Delivery times, shipping costs, and customer satisfaction with delivery. |
The Interaction between Shipping and Fulfilment
While fulfilment and shipping are distinct processes, they are closely interlinked. Efficient fulfilment directly enhances the shipping experience by ensuring orders are accurately and promptly prepared for dispatch. Conversely, proficient shipping practices improve customer satisfaction by delivering orders on time and in good condition.
