Are You Ready for Direct-to-Consumer Fulfillment?
With each passing year, eCommerce captures a larger portion of total retail. While big-name brands continue to dominate, smaller brands and even manufacturers are now jumping into the ring. And for those manufacturers that are ready to take the plunge, direct-to-consumer fulfillment offers some significant advantages.
What is DtC Shipping?
Traditionally, manufacturers supply products to retail partners, which in turn sell them to consumers. But in a direct-to-consumer (also called DtC or D2C) shipping strategy, a manufacturer sends products directly to consumers, cutting out the “middleman” altogether.
Direct-to-consumer fulfillment gives manufacturers end-to-end control over the product lifecycle and the customer journey. With the right automated EDI integrations, manufacturers can streamline DtC fulfillment and handle increased shipping volume, enabling them to scale their business in a new way.
Benefits of DtC eCommerce Fulfillment
Direct-to-consumer fulfillment offers several benefits to the manufacturer. For example, manufacturers shipping direct can control the entire customer experience instead of relying on retailers and distributors. A unified customer experience ensures each shopper encounters the right promotions, brand consistency, and level of customer service at every point in the journey. Additionally, DtC brands can access customers directly, offering key insights into customer demand trends.
Direct-to-consumer fulfillment allows brands to go beyond store shelf space to create an entire world for customers to explore. One example of this is the brand Thanksgiving Coffee. In addition to trading with retailers and restaurants, the company also sells directly to customers via the TrueCommerce eCommerce platform. Thanksgiving Coffee offers individual coffees, but also subscription services like their Roastmaster’s Select Club, which lets enthusiastic customers try exclusive micro-lot coffees. Through the club, loyal customers give Thanksgiving Coffee valuable insight into which new varieties will be popular releases—and they keep coming back for more.
Direct-to-Consumer Fulfillment Requires Creative Problem-Solving
While there can be many benefits to a direct-to-consumer fulfillment model, the strategy presents some unique challenges. A manufacturer that jumps into DtC fulfillment without the proper tools in place may be in for a rude awakening.
Direct order volume increases can quickly create shipping headaches when manually logging information. What's more, shipping DtC requires many manufacturers to switch gears from shipping pallets to sending individual cartons and boxes. This can be problematic, especially when working with legacy systems.
Customers expect fast turnarounds and working with multiple carriers can complicate supply chains. Also, if the manufacturer isn’t mindful of its retail partners when introducing DtC fulfillment, it could end up risking important trading partner relationships.
How to Win at DtC eCommerce Fulfillment
So, what’s the best way to overcome the unique challenges that come with running a DtC fulfillment operation? Automation. Today, there’s a new breed of customer who expects real-time communication and fast shipping, no matter where they live. To satisfy them, you need a new breed of fulfillment—one that runs on automated processes.
Handle Large Order Volume Easily
One of the biggest challenges of starting a DtC fulfillment model is handling increased shipments. Instead of sending large orders in cartons and on pallets to retail partners or distribution centers, the manufacturer is now responsible for shipping individual orders to customers.
When you have 600 consumer orders to ship in a week, you need to make sure each one is accurate. An automated shipping solution like TrueCommerce Pack & Ship can streamline key processes with item verification technology, address validation, and automated alerts to catch errors before shipments are sent out.
As orders come in, the information flows from your eCommerce website or marketplace channels to your multi-carrier shipping software. The system can process orders by the batch, print packing slips in moments, and generate carrier compliance labels in a flash. When all these parts are in sync, you can drastically cut down the time it takes to get orders out. Instead of entering data by hand, and printing labels one-by-one, the system can do the busy work and alert you when there’s a discrepancy.
Offer Fast Shipping at the Lowest Costs
Maintaining fast shipping times is crucial to keeping customers happy in an age where free, rapid shipping has become table stakes for eCommerce. Direct-to-consumer fulfillment enables the manufacturer to offer a range of shipping options for customers, rather than relying on partner-specified carriers. However, doing so can become costly and complicated, especially if you’re relying on a single carrier, or don’t have an easy way to assess costs across different carriers and regions.
With advanced shipping software, it’s as easy to ship an order with UPS ground as it is FedEx next-day-air. For example, the rate shopping feature of TrueCommerce Pack & Ship enables you to choose between 60+ carriers and find the most cost-effective carriers that can also meet your delivery windows. Data analytics empower you to negotiate lower rates by reporting on carrier-specific spend history.
Giving customers choice helps create a better buying experience. Using advanced automation rules, you can also tag specific carriers based on shoppers’ preferences and buying histories, to make sure they get their products, their way.
Safeguard Brand Reputation
Managing the customer experience can be another challenge for manufacturers that normally trust retail partners to handle customer service issues. In a direct-to-consumer fulfillment model, the manufacturer’s own reputation is on the line with every sale.
When you’re transferring data manually between spreadsheets, there’s a high chance for human error. You don’t want to stake your company reputation on whether you got enough sleep the night before. That’s why it’s important to have an automated system that connects your order system, ERP, and WMS.
Getting the right products in each box is also key. Scanning technology assists here, by ensuring that the products being packed match the SKUs listed on the order. These can be used in concert with weight audit alerts, which flag over- and under-packed boxes, giving employees the chance to correct issues proactively. As a result, your customers will get the right products every time, and be more likely to give you a 5-star review.
No longer do retailers and distributors take heat from unhappy customers—it’s all on the brand with DtC fulfillment. With automated shipping software, you can minimize mistakes and give customers more reasons to be happy.
Support Retail Partners and DtC at the Same Time
If a manufacturer mixes DtC and traditional fulfillment strategies, it can start competing against the retail partners it depends on. That’s not a good situation; it can stress or even risk existing trade relationships, and it can discourage new retailers from working with the manufacturer.
If you want to add DtC fulfillment but already have retail agreements in place, find out how you can assign specific product lines to each channel. For example, your brand could introduce a higher-end product exclusively on its own website, while it leaves the standard product range for distribution partners to sell.
In this situation, it’s imperative that your shipping solution handles B2B shipments as well as B2C orders. It’s important to keep things streamlined and clear when both types of shipments are leaving your warehouse. With the right technology, however, the balance becomes easy, be it using cartonization software can minimize your freight costs, scanning barcodes for B2C boxes, or designating fulfillment centers based on order types.
Automation is the Fuel in the DtC Engine
Direct-to-consumer fulfillment can unlock deeper customer loyalty and improve a brand’s reputation, but only if it has the right ERP integrations in place. TrueCommerce Pack & Ship provides a suite of automated tools that can help manufacturers keep up with direct orders and get shipments out on time.
For more information, reach out to one of our shipping specialists to see how we can enhance your DtC fulfillment and help your business grow.
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About the Author: Steve Norris is the VP of Pre-Sales Engineering, Supply Chain Collaboration, at TrueCommerce. He is responsible for helping engineer solutions that allow small to enterprise businesses more efficiently and effectively collaborate with their supply chain partners and expand their sales channels. With over 15 years of supply chain experience ranging from consulting to sales, Steve helps organizations looking to achieve growth and profitability through providing solutions that allow seamless connectivity to customers, suppliers, channels, and systems.