You can have a great product, but if you can’t get it to the customer free of cost or within two days, you have a great product without any takers.
In 2023, customers expect nothing less than free and fast shipping. According to an analysis conducted by Baymard Institute of 49 different studies, 47% of people abandon carts because of extra costs (including shipping) and 24% abandon because of slow deliveries, making shipping cost and delivery time the two of the biggest reasons for cart abandonment.
The reality for sellers is different. It is extremely hard to offer both free and fast shipping if you don’t have the pockets for Fulfillment by Amazon. Sellers often find themselves caught between the options of offering free shipping or fast shipping and end up choosing one.
While this strategy might work in the short term, it’s not sustainable. With Amazon doubling down on making one-day deliveries possible, customer expectations will only go up.
Who wins then — free or fast shipping?
Both! Offering just one is simply not enough! Remember that you’re competing for customers on extremely popular marketplaces such as Amazon and Shopify, and if you offer just one, your product will not stand out, no matter how great it is. Moreover, you need to offer both across all marketplaces your product is listed.
But offering free and fast shipping is no easy task. Especially when you have to do it nationwide.
Sellers already have some great solutions available such as Fulfillment by Amazon (FBA) and traditional 3PLs like Deliverr, but they can come with their own challenges. Let’s explore the key features you need from a fulfillment partner.
What are ideal features in a fulfillment partner?
Nationwide warehouse network
The best 3PLs offer true national fulfillment services by placing inventory in four or more locations across the US. Nationwide inventory distribution minimizes shipping costs by strategically placing product across the country closer to the end customer. The benefit to you is that these networks will cover 99%+ of US consumers with two-day shipping at economy shipping rates. No matter where your customer wants their product shipped, you’ll have inventory nearby. They get their item lightning fast, and you pay the cheapest possible rate.
Multichannel flexibility
E-commerce merchants are pushing into multiple sales channels to maximize growth, and your 3PL should be able to easily integrate with all of them. In addition to a nationwide network of warehouses, your 3PL should be integrated across all your major sales channels so you unlock both free and fast shipping across marketplaces, through one partner.
Affordability across small, standard and oversized product types
To achieve free and fast shipping, you need to save costs at every touch point. Many 3PLs optimize rates only for certain types of products — small, standard or large. For example, Amazon FBA is amazingly cheap for small and light products, but expensive for items that weigh just a few pounds. The best fulfillment partner should offer great rates regardless of the product size, offering both scalability and flexibility.
Free and fast shipping for both fast-moving and slow-moving SKUs
It’s imperative that you offer free and fast shipping across your product portfolio, to ensure growth momentum on all your products. Most sellers have fast-moving and slow-moving SKUs in their catalog. In the early stages they rely on a “hero” SKU for a major chunk of their profits. The slow movers are stored in less expensive areas of the country and they’re difficult to distribute because that strategy significantly increases inventory carrying costs. In short, sellers are compelled to opt for different strategies for their fast-moving and slow-moving goods. FBA specializes in fast-moving goods only and 3PLs like Deliverr use the same strategy as well. The best 3PLs offer you a consolidated network for fast movers and slow movers, streamlining your operations while saving you time and money.
E-commerce marketplaces have become extremely competitive for online merchants. There are some reports that favor the free shipping narrative, and others that favor the fast shipping narrative. Nevertheless, if merchants want a competitive advantage beyond their products, they need to be excellent at both — free and fast shipping.
With Cahoot’s peer-to-peer fulfillment network, you can have ultrafast eCommerce order fulfillment at prices lower than most of our competitors. Order Fulfillment is a growth driver, not a cost center – Cahoot, stands firmly behind this ideology. Contact us today to learn more.
