5 March 2018 | 16 Comments
I was shocked to learn on Thursday that Funagain Games was shutting down their fulfillment service (and online store). [Update: Funagain later reversed this decision, and they’re still operational.] They were my top recommendation to Kickstarter creators for US fulfillment, right up there with Fulfillrite and Quartermaster.
Coincidentally, I was planning on publishing a guest post today by Charlie at Fulfillrite. I mentioned to Charlie a while ago that I was looking to talk about fulfillment on my blog, as it’s such an important topic for creators, and it’s been a while since I added any shipping-related content to this page. It’s just that I personally haven’t fulfilled a project in quite some time.
Charlie came through with a massive blog post that is far too long to post here. So I’ve uploaded the full post here for you to read if you wish (along with some ancillary materials), and I’ll summarize below the key points from some sections of his article.
Why Use a Fulfillment Service?
- Time: Fulfilling orders can take a lot of time that you could otherwise spend running and growing your business.
- Space: A fulfillment center provides space you probably don’t have in your home/office.
- Cost: The high output volume at a fulfillment center commands lower costs (shipping fees, labor, packaging, etc) than what you could negotiate on your own.
If I Use a Fulfillment Service, What Am I Paying for?
- Receiving fees: When your shipment arrives at the fulfillment service, the products are received, unloaded, and sorted.
- Inventory Storage Fee: In the interval between receiving and shipping your product, it is stored on a pallet, or on shelves, or in a bin, depending on the product.
- Pick & Pack Fees: This is the hands-on stage, where your product is picked from its storage, packaged as per your order specification, labeled and prepared for shipment.
- Shipping Rates: The shipping fee is the fee you pay to the carrier have it shipped to your customer. This depends on the package weight/volume, delivery speed, and the distance from fulfillment center to customer.
- TOTAL: The total cost of all of these services for a package weighing less than 1 kg will be between $7 and $10. For a 1-2 kg package, between $9 and $12. And for a 2-4 kg package, between $10 and $14. As an example, here is Fulfillrite’s pricing calculator.
How Should I Choose a Fulfillment Service?
- Industry Chatter: Talk to other people in your industry to see who they use. Take their suggestions and further research each of those companies to find the best fit in terms of customer service, speed, reliability, packaging quality, cost, and other factors. You can learn a lot from testimonials like these.
- Initial Contact: Request a products guideline from the fulfillment services you’re considering. This will help you see if the company can fulfill the type of products you make and how they’ll expect you to format the orders you send them (some are more cumbersome than others). This will also help you gauge the quality of the service’s communication–did they reply on the same day, or did you not hear from them about your simple request for weeks?
- Bulk vs Individual: Specifically check to see if the fulfillment service can handle both bulk fulfillment (like Kickstarter rewards) and ongoing ecommerce fulfillment (like through your webstore). If you use a specific ecommerce platform, make sure it syncs with the fulfillment service.
- Other Resources: For Kickstarter creators (particularly tabletop game creators), use this Google Doc and this blog post to get a snapshot of various fulfillment options in each region.
What Else Should I Do After I’ve Selected a Fulfillment Service?
- Contracts: Cover issues such as breakage, lost items, returns, mispacked packages, fulfillment speed expectations, packaging quality, etc. Fulfillment is the most precarious step of reward-based crowdfunding, and you have the potential to lose hundreds of thousands of dollars if the fulfillment center botches their end of the deal. Make sure you’re legally protected against that possibility.
- Product and File Preparation: Get specific instructions from your fulfillment center regarding how they want the cartons and pallets packed and labeled, as well as their format for importing bulk order spreadsheets.
- Detailed Instructions: On this post I outline very specific instructions to give your fulfillment center. These include (a) don’t require signatures for delivery, (b) ensure that backers can see their full address on the tracking notifications, and (c) tell customers the number of packages they’re receiving.
- Testing: Before asking a fulfillment center to dispatch hundreds or thousands of shipments, start with 10 to see if they actually follow your instructions. Adjust accordingly from there.
Thanks so much to Charlie at Fulfillrite for putting together such an extensive article–I promise it goes far deeper into the world of fulfillment services than my summary above! [Update: Charlie has also posted an interesting article about multiple fulfillment centers.]
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