In today's world, where e-commerce and fast delivery are critical to business success, the efficient management of product warehousing and shipping has become a priority and this is where two key approaches come into play: the Fulfillment and traditional Logistics, both play fundamental roles in the distribution process, but there are significant differences between them that can drastically affect the customer experience and the performance of an eCommerce.
In this article, we'll explore each of these methods in detail to help you understand their advantages and disadvantages.
What is traditional logistics?
In this type of logistics the The company is responsible for the entire process, from the purchase of products to their storage, order preparation and shipping, and sometimes those responsible for this area must maintain and manage the inventory.
What is Fulfillment?
Fulfillment, also known as Fulfillment by the Seller (Fulfillment By Merchant) or external Fulfillment, is a more modern, outsourced approach to product management and delivery. Here, a company specialized in Fulfillment is responsible for the logistics aspects, that is, the storage, management and control of inventory, preparation and shipment of products while the business focuses on its main operations
🚀 Here you will find more information about Fulfillment processes and models
Traditional Logistics VS Fulfillment
Control and customization:
✅ Fulfillment: In this approach, the company cedes logistics control to an external supplier, which means that it has less control over specific aspects of the process but more time to implement improvements in other areas or processes of the company
✅ Traditional Logistics: Here, the company has full control over each stage of the logistics process, allowing for greater customization
Initial investment:
✅ Fulfillment: Outsourcing Fulfillment may require a minimum initial investment, since the company does not need to establish its own logistics infrastructure
✅ Traditional Logistics: Traditional Logistics may require significant investment to establish and maintain warehouses, equipment and personnel
Flexibility and scalability:
✅ Fulfillment: By trusting a supplier, companies can scale their operations faster and more effectively to meet greater demand or expand to new markets
✅ Traditional Logistics: Scalability can be slower and more complex due to the need to increase your company's infrastructure and staff
Operational Complexity:
✅ Fulfillment: Outsourcing Fulfillment can simplify the company's logistics operations and allow it to focus on its core business
✅ Traditional Logistics: The company must manage every aspect of the logistics process, which can become more complex and demanding as the business grows
Costs:
✅ Fulfillment: Using a Fulfillment provider can result in variable costs, since the company pays for services based on the number of products shipped and cubic meters that your product occupies in the warehouse
✅ Traditional Logistics: Although there may be a greater initial investment, logistics may have more stable and predictable costs in the long term
The choice between Fulfillment and Traditional Logistics will depend on the specific needs and objectives of your
E-commerce, for example, the Traditional Logistics may be suitable for companies with smaller operations and absolute control over the entire process. On the other hand, the Fulfillment is an excellent option for those looking to focus on their core business, outsourcing logistics for achieve greater efficiency, flexibility and cost reduction.
If your e-commerce seeks efficiency and flexibility, rely on a service of fulfillment in Mexico City can make a difference compared to traditional logistics, allowing you to reduce operating costs and focus on business growth.
