Fulfillment House Pricing- What Is Fair?

We all want to save money. But how do you know if your fulfillment house pricing is fair? Judging whether something is “fair” depends on the criteria you use.

Cheap! Cheap! Fulfillment Pricing

For instance, you’re working with a fulfillment company right now, yes? Perhaps you chose them because their pricing was the cheapest. So now you’re getting the bare minimum in services. That seems fair. If you want anything extra, there’s an additional fee for that — assuming they can even provide that something extra. That seems fair, too. But is this really what you had in mind for a fulfillment partner?

It can also be a mistake to automatically rely on the old adage “you get what you pay for.” That suggests that if it costs more, it must be better. Unfortunately, when it comes to fulfillment house pricing, this isn’t necessarily true.

So ask yourself this: how important is quality to our brand? To our customers? And how important is value to our company?

Price does not always accurately reflect value.

And isn’t value what you really want? Of course you care about the amount of money you’re investing in fulfillment, but the return on that investment is what matters most. The only way you can be confident you’re getting superior value from your fulfillment partner is to weigh all the tangible and intangible benefits.

So what constitutes value? Glad you asked…

It can be hard to quantify, but let’s try. Fulfillment can be an opportunity for your company as well as a cost. The sales you make today are important, but forward-thinking brand managers think in terms of customer lifetime value, or CLV. The longer you retain a customer, the more they spend with you. Studies show loyal customers tend to buy more often, and they tend to spend more each time. Obviously it’s in your best interests to keep customers happy.

A fulfillment process that is easy, on time and error-free makes customers happy. Thrilled, actually. That helps boost CLV, and that’s a more-than-fair return on your investment.

On the other hand, when a fulfillment partner cannot consistently deliver as expected, customers become unhappy. They abandon your company to shop elsewhere. Your opportunities for immediate sales and long-term CLV are lost. That’s a cost no company can afford.

If your goal is to grow your business by building customer loyalty, then you need to, value is the bottom line for your company. So when it comes to fulfillment house pricing, what’s fair is getting the consistent performance quality necessary to thrill every customer, every step of the way, with every order they place.