The global eCommerce retail sales grew by almost 17% and recorded the highest ever revenue of more than $ 4.9 trillion in 2021.
So if you’re thinking about starting your online business, the time is ripe.
And if you’ve already started your eCommerce business and you’re growing it steadily, then well done!
As you get the orders on your site and ship them, you may often get customer queries like:
- What does ‘package arrived at a carrier facility’ mean?
- What does ‘package has left the carrier facility’ mean?
- What is a local courier facility? etc.
These are some of the milestones that you update in your order tracking system so that customers can know the status of their orders.
Moreover, if you’re shipping more than 10 packages a day, you already know that managing eCommerce logistics can eat up a lot of your time while you’re scaling your business.
Although logistics does not generate any direct revenue for you, it’s the backbone of any eCommerce business. So while you don’t want to spend too much time on logistics, you can’t afford to take it for granted either.
That’s where partnering with the right carriers can give your business an edge.
In this post, we’ll discuss what is a carrier facility and the things you need to consider when selecting the right shipping partner for your e-store.
How Does an eCommerce Fulfilment Work?
Typically, eCommerce order fulfilment involves all the processes that take place once a customer orders online until they receive their product at the doorstep.
In fact, eCommerce order fulfilment starts even before your customer orders on your website and may also continue even after you deliver the product.
That said, here are the key functions of an order fulfilment process:
- Receiving the inventory: This step involves counting the incoming inventory and inspecting its quality. Then you’d assign the SKUs and generate the barcode stickers so that they can be easily retrieved when needed.
- Inventory storage: Once goods are received and inspected, they are stored in a warehouse or fulfilment centre. You need to manage your inventory efficiently to optimise your warehouse operations and turnaround times.
- Order processing: Once a customer orders on your site, it’s passed to the warehouse. The warehousing team retrieves products from shelves, packs them, and keeps them ready for shipping.
- Shipping: Next, the packages are handed over to the carrier to get them delivered to customers (Detailed discussion on carrier operations in next section).
- Reverse logistics: The order fulfilment process also includes processing the returns and exchange of products. It’s called reverse logistics.
As a business owner, you can either perform the above operations in-house or outsource the entire process to a third-party logistics (3PL) provider for greater efficiency.
Now let’s understand the carrier facility and its operations in more detail.
What is a Carrier Facility?
A carrier facility is a large warehouse or distribution centre of the shipping companies such as FedEx, UPS, DHL, StarTrack, CouriersPlease etc.
All the packages that are collected from the eCommerce fulfilment centres are brought to the carrier facility. Then they sort it for further distribution.
To understand the carrier facility and operations, let’s look at the step-by-step eCommerce order lifecycle.
- A customer places an order on your website.
- Order is automatically forwarded to the warehouse and a picking list is generated. This is where the pick-pack-ship process starts.
- The warehouse picker collects the items on the picking list and passes them to the packing station.
- Packaging staff packs the products, pastes shipping labels, and makes them ready for shipping. At this stage, your customer receives a message that their items are packed and ready for dispatch.
- Then the carrier collects the shipment from the warehouse or fulfilment centre. That’s when your system would send an alert to your customer that the order is shipped.
- The shipment reaches the carrier facility (or warehouse). At this point, your customer may see the product tracking status as “package arrived at carrier facility”.
- Now, the carrier staff sorts the packages as per their destinations and ships them accordingly through ground, sea, or air transport. And tracking status is updated as “package has left the carrier facility”.
- If it’s local delivery, the product is headed straight to your customer’s shipping address. Otherwise, it’s sent to the destination city, state, or country. In such cases, the shipments may go through multiple carrier facilities as needed.
- Then the package arrives at a local carrier facility — or local courier facility.
- Here, all the packages are sorted according to the local delivery addresses and your customer receives an alert like “your parcel is out for delivery” or “your shipment is on the way”.
- Finally, the delivery person hands over the parcel to your customer.
Thus, your shipments could check-in and check-out in one or multiple carrier facilities before they’re delivered to your customers. This would depend on the distance between origin and destination and the type of carriers.
Types of Couriers
The major shipping companies usually use the combination of the below-mentioned transportation methods.
Air transport is the fastest and the costliest mode of shipping. In fact, the air freight rates shot up by 55.9% in 2020 as compared to 2019.
Carriers usually transport the high-value and time-sensitive shipments through the air to get them delivered at the earliest.
Carriers like DHL, FedEx, and UPS operate their own fleet of cargo aircraft. Other smaller carriers either use their services or send their packages with commercial air carriers.
Some carriers specialise in road transport and offer parcel services, Full-truckload (FTL) and Less-than-truckload (LTL) services.
If you are sending one or several parcels, most general road freight carriers such as StarTrack, CouriersPlease, Aramex offer road services catering to your needs.
If you have a bulk of shipments enough to occupy the entire storage space of the truck, you can book an FTL service. Here you don’t have to share the truck space with other companies’ packages.
At the same time, you can opt for LTL service if you have a limited number of pallets.
Shipping through a railway can be a cost-effective mode of transporting goods. It’s suitable for industrial and bulk freight transportation to far distances. In Australia, Rail transport is often a more cost effective way of transporting from the eastern states to Western Australia. However, it’s also considered an irreversible transport method as you can’t stop or turn around your goods mid-way.
In addition, rail shipping is mostly used in combination with road transport for the initial and final legs of the journey.
Sea or ocean transport is the slowest but most widely used method of shipping. In fact, nearly 80% of all the goods globally are transported by sea.
On average, a ship may take 20-30 days for an ocean trip for cross-continent shipping. But when it comes to bulk freight, it’s a cost-effective mode of transport as compared to air cargo.
Sea shippers use large shipping containers to carry the goods. Again, depending on your need you can choose between the Full Container Load (FCL) and Less than Container Load (LCL).
Selecting the Right Courier - A Checklist
Since logistics is the backbone of your eCommerce business, ensure you spend enough time and pick the right carrier (or carriers).
Moreover, 73% of the customers shop online more now than they did in the pre-pandemic time. So you may continue to experience the spike in online orders.
As a result, you’d also need to strengthen your logistical capabilities by having the right shipping companies deliver your orders.
Here we have outlined some of the parameters you need to consider before partnering with a courier.
When it comes to selecting a carrier, the most important factor is whether the consignment is domestic or international.
For instance, if you’re shipping within Australia and if it’s not an urgent shipment, it’s better to ship with a domestic carrier.
On the other hand, if you’re sending packages across the globe, then you’d need to go with an international carrier. You may also want to consider multiple carriers according to their network strength in specific countries or continents. This is where a Courier Reseller such as PACK & SEND can shine, as they offer you great rates and instant access to a wide range of carriers and services in one place.
Partnering with a reputed carrier is not only important from the logistical standpoint, it’s also a hidden form of marketing.
When you work with experienced, stable, and credible carriers, your customers wouldn’t need to worry if their packages will arrive on time.
Although the established shipping companies may have higher shipping costs as compared to an average carrier, it’s still sensible to work with them.
At the same time, if you go with an unreliable carrier for the sake of saving some money in the short term, it can spell disaster for business in the long run if they fail to deliver your goods on time consistently.
Another factor to evaluate a shipping carrier is checking if they’re keeping up with the latest shipping technology.
For example, the latest route planning software helps carriers manage transportation routes in real-time according to weather conditions and other emergent challenges en route. This would ensure that your shipments are not stuck due to such adverse conditions.
So if you’ve partnered with a carrier that stays on top of the latest shipping technology, your packages will be transported with greater efficiency. And eventually, your brand would benefit from it.
As per Allianz safety and shipping review 2021, 49 large ships were lost worldwide last year.
So you may also want to analyse the operational safety measures of a carrier. For this, check details like their safety ratings, accident rates, damage-in-transit rates, etc.
Let’s say one carrier offers you lower rates, but their accident rate is higher than the industry average. This would increase your operational risks too if you ship with them regularly.
Hence, it’s advisable to pick a shipping company that charges more but follows all the industry safety standards diligently.
There has been a major disruption in the logistics industry in the wake of the pandemic. In addition to the prevalent shortage of shipping containers, shipping routes were also affected. Hence, the global supply chain is still recovering from this disruption.
Moreover, online shopping is rising consistently. As a result, demand for shipping services is constantly outdoing the supply.
So study the carriers’ handling capacity, fleet size, availability of containers, etc. and compare them.
Also, check if the shipping company you’re considering has adequate freight lanes for your desired destinations.
Weight and Size of Your Packages
The kind of products you want to ship determines the packaging requirements of your shipments.
Also, the size and weight of your package will determine the shipping charges you’d pay.
While one carrier may specialise in shipping bulk freight or heavy items, the other could be best for transporting smaller or lightweight packages.
Moreover, some carriers charge on the basis of the volumetric weight of your shipment.
So analyse each carrier against your package type and see what fits the best.
Cost and Turnaround Times
Apparently, the shipping costs and shipment turnaround time are the most crucial factors to look into while selecting the carrier.
As an eCommerce business, shipping and warehousing costs would make for the major part of your operational expenses.
Simultaneously, on-time delivery is also a key performance indicator (KPI) for online businesses. It’s significant enough to make or break your brand’s success.
The pandemic-led disruption has aggravated the shipping delays as port congestions have worsened. Hence, the transpacific ocean rates are almost eight to nine times higher than pre-COVID time.
So while you would want to save your shipping costs, you also don’t want to compromise on timely deliveries. This is another strong reason to consider choosing a multi-carrier reseller such as PACK & SEND. With a reseller, they can help you optimise your carrier choice for every lane and parcel size, to get the best combination of service and value.
As we wrap up this post, it’s worth reiterating that logistics is one of the most influential determinants for an eCommerce business.
Hence, you must ensure that you partner with a shipping carrier that is right for your business.
While there’s no one-size-fits-all formula for selecting the shipping company, factoring in the above guidelines shall help you pick the right carrier.
Remember, it’s always better to work with a credible and reliable carrier even if it costs a little higher, rather than run-off-the-mill carriers offering low rates and compromising the delivery deadlines. Ultimately it’s about your brand, it all adds up.
Frequently Asked Questions (FAQs)
What does ‘received by carrier’ mean?
Once the order is forwarded to the warehouse, the team packs the items and keeps them ready for shipping. Then, staff from the carrier company collects the shipment from the warehouse or fulfilment centre.
So after the carrier collects the shipment from your warehouse, the order tracking status shows that the order is ‘received by carrier’.
What does ‘package arrived at a carrier facility’ mean?
When carrier collects the shipments from your fulfilment centre, they take them to their own warehouse or distribution centre.
After the package reaches their distribution centre, the order tracking status is updated as ‘package arrived at a carrier facility’.
Then, they sort the shipments according to their destinations and load them in the respective vehicle.
What is a local courier facility?
When your package is transported to the destination city, it first goes to the local warehouse of the carrier or the courier company in case the carrier doesn’t have accessibility in that region.
This local warehouse is referred to as a local courier facility or a local carrier facility.
What does ‘arrived at local courier facility’ mean?
Once your shipment reaches the local courier facility, the order tracking status in the system is updated as ‘arrived at local courier facility’. This helps your customer know that package will be delivered soon.
How long do packages stay at carrier facilities?
Usually, packages are turned around within one or two business days after they reach carrier facilities. However, if there’s a heavy rush due for any reason, it may take longer.
Moreover, it may also vary from carrier to carrier. Also, it depends on the carrier’s transport frequency on that specific route.