What is a Fulfillment Program & How is it helpful for E-commerce Sellers?

If you’re a business looking to outsource storing and managing prospective orders then fulfillment centers are for you! But what is a fulfillment centers?

Fulfillment centers are centralized warehouses or facilities where products are stored, packaged and shipped to customers. They are mainly used by e-commerce businesses who are often equipped with advanced technology to handle large amounts of orders, ensuring the customers receive their products and orders on time.

What is a Fulfillment Program?

A fulfillment program is a system that manages the customer orders from receiving to delivering the products within a specific time.

It deals with:

• Inventory management 
• Packaging
• Shipping
• Returns
• 24/7 customer support

When a customer places the order online, the fulfilment program is enforced by sending an order to the necessary fulfilment Center for the further process of delivering the products directly to the customers.

Why do e-commerce sellers need Fulfillment Programs?

E-commerce businesses are at the peak level in the present market. The establishment of numerous online businesses has led to a competitive environment, therefore opting for a fulfillment program for your business can be an advantage and is the first step to be ahead of your competitors.

Here are the benefits received by choosing fulfillment programs:

• Experienced workers: In order to run an e-com business into a success, one should know the market like the back of their hand. Outsourcing a reputed fulfillment center  will enable a seamless fulfillment process, as they are well versed with the industrial knowledge and advanced technology.

• Global network: With fulfillment programs, one can operate globally even without  vast knowledge about the markets across the globe. Therefore, your e-commerce business can reach its fullest potential with access to the international networks, allowing your business to grow beyond what you expected.

• Mainstream operations: Focusing on all the aspects of running a business can be a task, thereby outsourcing a fulfillment center can eliminate the burden of storage and delivery of the products, allowing you to focus on keeping your customers satisfied.

• Customer service: It’s more important for businesses to retain their current customers than attract new ones. An exceptional customer service is the first step in keeping a customer satisfied. A reputable fulfillment center exercises 24/7 customer support, resolving queries, handling returns, etc., thereby building the image of your business.

• Scalable: E-commerce businesses are easily manageable in the beginning of the business, but as and when they grow, it will be difficult to handle the orders in bulk, which, when failed, can result in losing customers. Signing up with a fulfilment program can ease your burden,as all the operations related to storage and processing orders will be managed by the service providers.

It’s very important for companies to hire a reputed fulfillment center for a successful fulfillment process. Amazon and Flipkart fulfillment programs are the most popular options available. These programs ensure smooth operations of logistics, including inventory management and delivering the product directly to the customer, thereby allowing your company to solely focus on scaling the business.

Benefits of e-commerce sellers using multiple FCs

Having multiple fulfillment centers will help you gain a competitive edge in the market. Having inventories in multiple FCs can increase your product ranking in search results, thereby making it easily available for your customers.

Here are the benefits of having multiple FCs:

1. Improves customer satisfaction: Products that are stocked over multiple FCs will allow the service provider to deliver the products in a short period of time, thereby improving customer satisfaction.

2. Improves ranking: Having inventories in different FCs will improve the ranking in search results as your product gets a higher priority over the other set of items that are at a distant location or either out of stock. Delivering a product in a shorter time frame can also increase your chances of ranking higher, thereby providing your business a competitive edge in the market.

3. Demand: E-commerce businesses can optimise listings based on recent trends, therefore products that are stocked based on the listing are likely to be prioritised over the other products.

4. Scalable: Having multiple fulfillment centers enables easier scalability where the sellers can tap into new markets without having to open a new warehouse .

5. Cost efficient: Fulfilment centers in multiple areas can help your business cut down certain costs such as shipping distance and other fees added to it, thereby allowing the service providers to ship from the nearest location to the customer within a shorter time frame.

The process of a Fulfillment Center

As we are all aware that a fulfilment center is a facility that stores your inventory and manages logistics on behalf of your company. The key component of a fulfilment center is the fulfilment program that manages the whole process of shipping orders to your customers directly. It also includes:

• Stock management 
• Packaging
• 24/7 customer support 
• Refund /returns 

• In order to successfully sign up with a fulfillment center the government has made it mandatory for all the businesses dealing with goods to have a PPOB (Principal Place of Business), where the core activities of a business is carried out under GST regulations. This can create complexities for e-commerce businesses as Flipkart and Amazon do not allow the FCs to be registered as the PPOB of the sellers business.

• Therefore, businesses can opt for a VPOB (Virtual Place Of Business) to be used as an alternative as it provides a professional business address complying to the GST requirements. This completely rules out the necessity of having a PPOB, thereby enabling the businesses to use fulfillment centers without regulatory conflicts.

VPOB (Virtual Place of Business)

A virtual place of business refers to a facility that allows businesses to have a professional address complying with GST registration across different states, thereby eliminating the time to set up a traditional office.

• They are proven to be cost-effective 
• Scalable depending on the size of your business
• Negotiable lease terms, thereby eliminating long term commitments 
• Legal compliance with necessary registrations required
• Receptionist services like mail handling, call forwarding,etc.
• Administrative support team representing your business
• Fully furnished office spaces with access to meeting rooms.

What are the benefits of having a VPOB?

Having a virtual place of business can be convenient for sellers as it enables easy file reuters and smooth management of operations across different states without having to own a physical office space.

Here are the benefits:

1. Cost effective: VPOB is often cost effective enabling businesses to focus on their core activities without the burden of leasing and maintaining an office space.

2. Convenience: Flexible for sellers to register for GST and to file returns without having to own a traditional office space.

3. Efficient delegation: Opting for a VPOB allows you to focus on the core responsibilities with an administrative support team representing your business unlike traditional office spaces.

4. Amenities: Along with a professional business address you receive facilities such as mail handling, call forwarding, audit and other receptionist services.

5. Workspace on-demand: Businesses signed up with VPOB have access to meeting rooms, desks,cabins, pay per use model, etc.

6. Flexibility: Allows businesses to work remotely while maintaining a professional presence

7. Regulatory compliance: Complies with GST and other regulatory measures by providing a professional business address.

Hence, opting for a VPOB enables easier scalability where the sellers can tap into new markets without having to own a traditional office space. This enables the businesses to use multiple FCs while maintaining full compliance with GST registrations.

How to add an FC with VPOB ?

Step 1: Obtain GST registration for VPOB complying with the regulations.

Step 2: Visit the seller network dashboard, where all your e-commerce operations are managed.

Step 3: Collect the necessary documents from the fulfilment center, which includes FCs address proof, GST registration, etc.

Step 4: Under GST registration details add FC as APOB (Additional Place of Business).

Step 5: Upload the certificate on the seller network dashboard.

FAQs on Fulfillment Centers