According to Royal Mail’s UK Subscription Box Market report, the UK subscription box market is set to be worth £1.8 billion by 2025. However, handling subscription eCommerce is challenging, and you will want assistance beyond standard eCommerce fulfillment service. Your 3PL can be a great partner, providing subscription fulfillment and other services to help your subscription business succeed.
What is Subscription Fulfillment?
Subscription box fulfillment is the process of packing and distributing products from an eCommerce store to buyers on a regular basis. The procedure may include picking, packing, labelling, and delivering packages to recipients.
Most subscription-based e-commerce sites use subscription boxes to provide niche products to loyal customers. Organic products, vitamins, beauty, and other products may be delivered by online merchants that provide product subscriptions. Some companies have their own subscription fulfillment service, while others use third-party providers (3PLs).
The Benefits of Doing Subscription Model
Let’s delve into the substantial benefits that subscription model strategies bring to the eCommerce industry, redefining the way brands interact with their customers and offering a competitive advantage in the digital marketplace.
Improved Retention Rates
When it comes to subscription services, the most crucial benefit is the guarantee of retained customers. When you adopt a subscription model, you can nearly ensure recurring business. Customers can sign up for monthly subscriptions.
With subscriptions that provide additional discounts for people who join up for 3-12 months, you may ensure a specific monthly revenue without creating any additional purchases through the website. With this retention guarantee, you can avoid expensive acquisition efforts and instead focus on your existing customers, giving exciting new products each month and a loyalty discount.
Greater Lifetime Value
Subscription models and the promise of retained custom are closely linked to an increase in customer lifetime value. Your customer lifetime value (CLTV) is the average revenue that a client will create for your business over the course of its existence. Increasing CLTV will help your business grow and earn more income, allowing you to better plan and manage marketing budgets, product forecasts, and much more.
Better Inventory Forecasting
Encouraging more individuals to sign up for your subscription boxes will help you better plan your inventory management and impact crucial decisions about importing or manufacturing products. Using a subscription model allows organisations to better estimate what they will need and when. Furthermore, employing the curation model allows you to send extra products to customers, allowing you to better manage your inventory!
Guaranteed Income During Off-peak Periods
If your business experiences fluctuations in sales, a subscription model may be a great way to ensure constant revenue year-round. Having customers subscribe to your products yearly or on a rolling basis can mean that you will have guaranteed revenue during the months when sales are generally low.
Satisfied Customers Every Time
The right fulfillment leads to consistently satisfied consumers. The final benefit of subscription boxes is that they are beneficial to all eCommerce businesses as long as the fulfillment is done correctly the first time. When it comes to subscription boxes, customers will expect to get their order on the same date every month. They will be filled with expectation, which will quickly lead to disappointment if their order does not arrive. Having a robust fulfillment process in place will make the difference between your customers cancelling or keeping their membership.
Challenges of Fulfilling Subscription Orders
While subscriptions make it convenient, periodic shipments bring their own set of challenges for ecommerce businesses. Here are some of the most challenging aspects of subscription box fulfillment.
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Shipping orders on time
Your subscription customers expect their deliveries to arrive at the same time each month or at another recurring interval, especially if they need a refill of a daily essential! Shipping your subscription orders on schedule is critical to satisfying customer expectations and providing a positive subscription experience.
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Changing products monthly
If you change the contents in your subscription box every month, make sure you allow enough time for your supplier to get the products to you or your eCommerce fulfillment provider. Even if your subscriptions are consistent month after month, effective inventory management will allow you to monitor your products and avoid stockouts.
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Maintaining quality control
If your subscription boxes are precisely crafted works of art, whether you fulfill orders in-house or outsource to a fulfillment company, that’s a lot of effort. Unlike a standard shipment that consists of a box, some airfill, and a product or two, handpicked subscription boxes require extra attention.
The Value I-Fulfilment Can Bring to Subscription Box Business
When opting for third-party logistics (3PL) for your subscription fulfillment needs, you can access the advantages of professional fulfillment. Below are the services I-Fulfilment can offer to your business.
- Flexible Warehousing: Flexibility in warehouse space to reduce your storage costs.
- Inventory Management: Efficient tracking and handling of inventory to ensure accuracy and availability.
- Seamless Integration and Omnichannel Fulfillment: Integration capabilities that seamlessly connect with all sales channels, providing a unified and efficient fulfillment experience.
- Kitting: Customised bundling solutions to meet specific product requirements and enhance overall efficiency.
- Marketing Fulfillment: Comprehensive services to support marketing initiatives, ensuring promotional materials reach the intended audience effectively.
- Accurate Fulfillment Services: Precision and reliability in order fulfillment, getting it right the first-time and guaranteeing customer satisfaction.
- Scalability: A flexible framework that allows your fulfillment services to grow alongside your business.
- Variable Carrier Selection: Freedom to choose from a variety of carriers, enabling you to optimise shipping options based on your specific needs.
- Cost Savings and Expedited Delivery: Strategies to minimise shipping costs and reduce delivery times, enhancing overall customer satisfaction.
At I-Fulfilment, we view each fulfillment challenge as an opportunity to provide innovative solutions and deliver unmatched services. Whether you require subscription fulfillment services, high-value fulfillment, or storage and shipping for oversized products, we are prepared to meet the challenge. Contact us to discuss how we can support the growth of your subscription business.
