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Featured Topics: AmazonDirect-to-ConsumerDrive Operational ExcellenceCOVID-19

3 Options for Diversifying D2C Fulfillment

Christian Hassold | April 3, 2020

Amazon is a highly desirable partner for brands to market and sell products to consumers. When it comes to product search, 46.7% of consumers start their product searches on Amazon, according to a 2018 eMarketer survey.

For brands, Amazon provides exposure, demand, and (most importantly) logistics. But what happens when Amazon struggles to meet logistics needs?

Amazon has stopped taking inbound shipments and is severely delaying direct-to-consumer (D2C) shipments of nonessential products as a result of the ongoing COVID-19 pandemic. This shift has happened at a time when consumers are relying heavily on ecommerce to meet their shopping needs while staying within the confines of their homes.

Not the First Time for Amazon Logistics Stress

During both the 2018 and 2019 Christmas holiday season, Amazon experienced delays in getting products through its vast logistics network.

While Amazon is expected to return to normal operations eventually, these challenges should force ecommerce leaders to begin evaluating alternative fulfillment options. Here are three that we recommend considering for D2C fulfillment.

D2C Fulfillment Option #1: Deliverr

Deliverr is a San Francisco-based start-up that provides an experience similar to Fulfillment by Amazon (FBA) for its customers. Its offering is technology-centric, and customers enjoy Deliverr because its services are certified for both Amazon Seller Fulfilled Prime (SFP) and Walmart Two-Day Shipping.

Deliverr Key Metrics

Geographic Coverage U.S.
Number of Warehouses 30
One-Day Reach 40% for Shopify Fast-Tag Program Participants
Three-Day Reach 95% of U.S. Population
Minimum Order Volume None
Returns Handling No
Shipment Types Business-to-Consumer (B2C)
Badging Amazon SFP, Amazon Fulfilled By Merchant (FBM), eBay Expedited, Walmart Two-Day Shipping

Deliverr is designed to be similar to Amazon FBA in terms of structure and pricing. It uses contracted warehouses, so one will not know the exact location of their warehouses. On the plus side, it provides recommendations on where to balance inventory based on customer demand.

D2C Fulfillment Option #2: Red Stag Fulfillment

Red Stag Fulfillment is a third-party logistics provider based in the Midwest. We like them because Red Stag is a small company that offers personalized service. The fulfillment provider questionnaire provided on its website is an excellent resource for evaluating potential logistics partners.

Red Stag Fulfillment Key Metrics

Geographic Coverage U.S.
Number of Warehouses 2
One-Day Reach 70% of U.S. Population
Three-Day Reach 80% of U.S. Population
Minimum Order Volume 300 Per Month
Returns Handling Yes
Shipment Types Business-to-Consumer (B2C), Business-to-Business (B2B)
Badging None

Red Stag has two fulfillment locations in the U.S., which are both certified by the Food and Drug Administration (FDA) for non-refrigerated items. It’s likely an ideal partner for cost-effective fulfillment for three- to five-day shipments.

A unique feature of Red Stag is it can handle product bundling and heavy or bulky items that others may not cost-effectively manage. It can also support wholesale shipments.

D2C Fulfillment Option #3: ShipBob

ShipBob is a growth-stage company based in Chicago. The company is very transparent about warehouse locations and is noted for providing great customer service. As a growth-stage company, ShipBob is continuing to make investments in its business.

Most recently, it opened a location in Ireland to support fulfillment in Europe. ShipBob is popular with D2C brands and is preferred by many Shopify Plus merchants.

ShipBob Key Metrics

Geographic Coverage U.S. and Northern Europe
Number of Warehouses 8
One-Day Reach 90% of U.S. Population
Three-Day Reach 95% of U.S. Population
Minimum Order Volume None
Returns Handling Yes
Shipment Types B2C
Badging Amazon FBM

ShipBob allows for inventory balancing across its warehouse network to streamline fulfillment. However, its technology doesn’t recommend where to place inventory for brands. ShipBob is the most adept of these three fulfillment options for handling shipments to and from Europe.

Weighing Logistics Options

There are many third-party logistics options in the U.S. and Europe to consider. If your brand is new to exploring D2C fulfillment, reach out to us at Salsify for a consultation with one of our logistics experts.

All Topics: Amazon , Direct-to-Consumer , Drive Operational Excellence , COVID-19

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