The subscription box boom sweeping the country is giving rise to a new kind of order fulfillment. While many subscription services have an online component, their order fulfillment needs are considerably different from those of ecommerce fulfillment. As a recent article in The Wall Street Journal points out, “. . . the logistics of shipping subscription packages often go against conventional rules of ecommerce.”[i]
Subscription box fulfillment is typically a very complex, customized, labor-intensive process, conducted within a tight delivery window. Space, labor and expertise are just a few areas where the needs of subscription box companies differ from those of ecommerce retailers.
Take a closer look at five key areas of distinction and how an experienced fulfillment provider can help:
- All hands on deck
While ecommerce orders ship on a fairly steady basis throughout the year, the monthly (or quarterly) delivery cycle of subscription orders leads to brief periods of intense volume – much of which is handled manually. Adjusting labor and space to suit these dramatic peaks and valleys can be very challenging. It can also be quite expensive to pay for space and staffing to accommodate the highest volume each month when operations are only at capacity for a limited number of days.
Fulfillment providers can balance the variations because they work with multiple customers. For example, Saddle Creek assembles and ships millions of “glam bags” within a four-day period each month for ipsy, a popular subscription beauty product company. To accommodate this volume in such a tight time frame, Saddle Creek leverages one of its shared-space facilities and ramps up production with additional lines and staff during ipsy’s peak fulfillment times.
- It’s all in the presentation
Unlike typical ecommerce shipments in non-descript corrugated boxes, subscription boxes are designed to delight the recipient and must arrive looking consistent and professional. For added appeal, packaging may include tissue, ribbon, stickers, etc.
“Presentation is important for subscription-box customers, who swap unboxing videos, photos and reviews online,” The Wall Street Journal notes.[ii]
For subscribers of Vinyl Me, Please, a fast-growing record-of-the-month club, Saddle Creek associates skillfully package a vinyl album along with an original 12” x 12” art print and a suggested cocktail pairing in a high-impact, customer shipper.
- To each his own
While the packaging must be consistent, the contents of subscription boxes are not. Part of their appeal is that the complete product mix changes every month. To further complicate operations, many subscription companies allow customers to pick and choose the contents of their subscription to suit their personal tastes.
Personalizing orders is a complex, labor-intensive process. Effective third-parties are equipped with the staffing, processes and space to handle a variety of configurations based on client profiles, wants, interests, etc. For example, Saddle Creek packages and delivers as many as custom 60 configurations of beauty bags to ipsy members each month.
- Timing is everything
Unlike standard ecommerce customers who have come to expect fast, free (or low-cost) delivery, subscription customers count on the arrival of their package at a certain time every month. Since subscription products are often promoted extensively through social media, delivery dates must be carefully coordinated.
“Packing and shipping is timed so that boxes go out in waves. Those destined for the farthest regions go first, so packages to customers in one region all arrive on roughly the same day, to avoid spoiling surprises,” The Wall Street Journal article explains.[iii]
For Love With Food, a gourmet, all-natural food subscription service, Saddle Creek coordinates deliveries according to customer location so that subscribers in different parts of the country receive their orders at approximately the same time.
- Quality counts
While order accuracy and quality are important for any company, it is especially critical for subscription-box businesses. Customer feedback is shared widely via social media, so inaccurate orders, damaged products and subpar service can lead to customer dissatisfaction on a large scale.
“Once a brand starts to disappoint consumers, they will be willing to jump ship,” says NPD’s analyst Marshal Cohen. “This means that brands need to earn their loyalty to their subscribers every single month.”[iv]
Experienced fulfillment providers typically offer inbound component inspection and a variety of outbound quality programs as well as repackaging and return handling. For instance, Saddle Creek manages quality control and inspection as well as process returns for a number of subscription box customers, including Vinyl Me, Please.
When outsourcing fulfillment for your subscription box business, it is important to keep these unique needs in mind and find a partner with the expertise to ensure success.
To learn more about subscription box fulfillment, download our new whitepaper: Putting Outsourcing to Work for Subscription Box Fulfillment.
[i] “With Subscription Beauty Boxes, Rules of E-Commerce Don’t Apply,” Loretta Chao & Joe Buglewicz, The Wall Street Journal, May 19, 2016.