Worker walking around shipping facility

Shipping lead time: what is it and how can you reduce it?

Between storage, stock maintenance, order processing, and shipments, online merchants have a big job. Add to that a tremendously competitive market, and it’s enough to tempt you close up virtual shop and go home.
But did you know that decreasing lead time is one of the easiest ways to gain an edge over the rest of the industry? Especially when dealing with cross-border shipping, one of the most attractive offers you can make customers is faster lead time. Keep reading to learn how to improve productivity, decrease shipping lead time, and speed up turnover in general.

What is shipping lead time?

To clarify: lead time is the amount of time between when an order is placed and when it is shipped. Some businesses call this processing, while others refer to it as handling.

How can you reduce the lead time?

eCommerce merchants are always looking for ways to cut down on the amount of time it takes to get those orders packaged and out the door. And since competition is fierce with some sellers guaranteeing next day delivery – or even within the hour delivery! – eSellers need to aim for lightning-fast lead times if they want to keep customers happy. This is an even bigger issue for eSellers who are selling their products to customers around the world.

According to a recent study done by UPS, speed of delivery was the fourth most important decision-making factor for online purchasers. Nearly 40% of shoppers chose marketplaces based on their faster turnaround times. What’s even more interesting, researchers found that consumers were even willing to pay for faster shipping.

Reducing shipping lead time can give you a serious advantage over your competition, and the good news is it’s not that hard. Check out these fast tips for cutting down your lead time and staying ahead of the competition.

Tip #1: Turn to FBA dropshipping

Fulfillment by Amazon (FBA) is one of the easiest ways to keep your lead times low. FBA basically lets this eCommerce giant do all the dirty work for you, from storing to packaging and shipping. Since Amazon eats, sleeps, and breathes online shopping, they know the industry like the back of their virtual hands, so you have them handle everything for faster, smoother, easier processing.

Using FBA gives eSellers advantages like:

  • More time to focus on marketing or lead generation
  • Hassle-free order fulfillment
  • Faster shipping lead time
  • Access to millions of leads through the Amazon Marketplace
  • Access to Amazon Prime members, higher quality leads that generally spend twice as much as the average Amazon shopper
  • Amazon shipping perks for your customers (like Amazon Prime, 24/7 customer service, generous return policies, etc.)
  • Better chances to hit the Buy Box spot

What’s more, it’s a lot easier to build your business if you have the pros at Amazon handling all of your orders.

FBA  works best for businesses that are looking to expand their services or reach and eSellers who just don’t want to or can’t handle the hassle of shipping and handling. Follow these steps to get things started:

  1. Sign up for an Amazon account.
  2. Have your inventory shipped to Amazon. They’ll store your stock items in their warehouses until sold.
  3. List your products in the Amazon Marketplace.
  4. When orders come in, Amazon does the work, and you just pay a fee.

Seasonal items or slow to sell items may not benefit from FBA since these items can sit in the warehouse for months without movement. In this case, you’d be paying for the space and not reaping any benefits.

Tip #2: Simplify the supply chain

One of the reasons processing takes so long is because eSellers get their products from many sources. Try consolidating your supply vendors so you can track shipments more efficiently. If you deal with a lot of specialty items, think about swapping these out for comparable standard items that are easier to stock.

Tip #3: Be more organized

Sometimes the little hiccups end up costing you loads of time and might even cost you your return customers due to dissatisfaction. Look at your handling process from start to finish, and see which areas can be tightened up. For example, are you disorganized about data entry, or just simply lazy and can’t be bothered to do it? If this step is taking up more time than necessary, invest in a program that automates this annoying task. Not only will you get out of a boring job, but you’ll reduce the lead time by having tasks get processed faster and automatically.

Cutting down your lead time will give you the edge your internet-based business needs to really soar above the competition. Find out other great ways to make your e-store shine brighter today.

 

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