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Fulfillment: The Outsourcing Option

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Hiring a company to handle fulfillment apparently appeals to a relatively small group of PMA members. But, like those who fulfill orders themselves, most publishers who outsource are happy with their choice. It’s worth noting, though, that several voiced complaints, and more than one used the word “nightmare” to describe experiences with an outside fulfillment provider.

In the stories that follow, you’ll find mentions of a few specific companies. Please remember that each mention reflects one person’s opinion at one particular time, and that opinions can and do change because facts change or for other reasons. If you decide you’d like to hire a company to handle fulfillment, you should, of course, do your own research and apply all the common-sense criteria you’d use when hiring anyone else. One publisher, for instance, “sent requests for proposals to eight or nine companies, reviewed replies and selected five or six companies to visit, and then winnowed the group to three for contract negotiations” before making a deal.

You’ll see as you read that some PMA members fulfill orders through companies that aren’t entirely devoted to book fulfillment, or even otherwise involved with it. In upcoming issues we’ll feature additional inventive fulfillment solutions.

–Judith Appelbaum

When Sales Reach a Certain Level

I could go on for many hours on fulfillment, as we recently moved our fulfillment from in-house to an outsourced vendor.

Our publishing program, SmartsCo, was founded by Jennifer Elias and me–two wine lovers in San Francisco. We created our first title, WineSmarts, as a fun way to learn about wine, because we thought that too many wine books overwhelm people with information that is not relevant for the day-to-day pleasures of enjoying wine. WineSmarts is in its third printing after less than a year, thanks in part to accolades from wine and food celebrities and features in magazines. The success of WineSmarts encouraged us to branch out, and we released two new titles in November 2003: FoodSmarts and WineNotes.

As we started our business, we elected to do fulfillment in-house because it saved us money, and we had no idea whether our product would take off. With one title and strict order requirements (people could order only in increments of a dozen), it was an affordable option for us. PMA’s PartnerShip program with FedEx was very helpful in getting us FedEx discounts, and, since our distribution channels were limited, fulfillment didn’t take too much of our time.

However, as we ramped up our marketing efforts and began receiving great press, it became difficult to market our products, create new products, manage credit and collections, and pack boxes. Also, last summer our sales exceeded our expectations, and we went for about three weeks without any inventory in stock. When the shipment finally did arrive, it took us several weeks to catch up fulfilling our backorders.

We considered bringing in part-time help to fulfill orders, but since the order level is still inconsistent from week to week, we looked around at several fulfillment houses and signed with a new one, Internet Packaging Solutions (IPS) in Benicia, CA. To date, we’re very happy with this decision, and I don’t know how we would have managed our holiday orders without them. The prices are competitive, and the company is run by smart people who strive to provide quality customer service. They’re experienced in all sorts of shipping and fulfillment, and it’s now easy for us to sell directly to end-user consumers (due to time constraints and channel conflicts, we had not shipped to them before).

The plusses of outsourcing fulfillment are:

 

·

It frees lots of our time.

·

We benefit from IPS’s shipping discounts.

·

We get better quality assurance (IPS samples inbound cartons for quality,

which we hadn’t done).

·

Costs for packing materials are lower (plus IPS has the ability to ship any

quantity).

·

Fewer books get hurt because of more professional packing.

·

Packing slips are more professional.

·

Reporting on our inventory is better.

·

Our books are shipped daily rather than twice weekly.

·

IPS uses recycled material for all our shipments.

·

IPS catches many of our errors and provides consulting on how to improve our

services to customers.

The outsourcing minuses are:

·

We can’t be absolutely sure a shipment is going where we want it to go.

·

There are additional costs (but we think they will net out with higher shipping

discounts).

Julie Tucker, SmartsCo

Web site: www.smartsco.com

Getting a Life Back

I use Shipping-And-Handling.com for all order fulfillment. My orders come to the company from my shopping cart software. I chose it after interviewing several companies at length, comparing prices, and phoning some of this company’s existing customers. It has low minimums (about $195 per month); its price is excellent ($2.35 per order); and the owner of the company, as well as his staff, seem extremely competent, flexible, and determined to do great work. After six months with them, I have a life again! Normally I do not respond to surveys, but I am so impressed with this company, I feel obliged to spread the word!

Mike Dooley, TUT’s Adventurers Club

Web site: www.tut.com

The Privilege of Cherry-picking

For our first title, we acted as our own fulfillment house. The title sold very well in regional, seasonal spurts, which meant that sometimes we had no shipping to do and sometimes we had more orders than we could handle with a one- or two-person staff. Too many trips to the post office. Couldn’t qualify for good UPS rates due to erratic shipments and unpredictability of a new title, etc. Many sore back muscles as well! We averaged $18 per shipment via USPS for a box weighing 22 pounds, and the time involved to pack, print packing slips/labels, invoice, and then follow up with collections was awful and counterproductive.

For our second title we hired a fulfillment company, but not one most publishers would know. A personal acquaintance of mine owns a fulfillment house that specializes in direct marketing and has never done anything related to publishing. Because I had a business alliance with this company during a former career, the owner now allows us to cherry-pick services. We pay $12 per full skid storage per month, which is very reasonable. We have the benefit of the company’s bulk UPS and other carrier rates, and it charges minimal handling fees.

Now when we get an order, we e-mail the packing slip to the fulfillment house, which attaches the slip to the cartons, ships, and bills us with one monthly invoice. It also inventories the two titles we have in stock on a quarterly basis. For additional fees, the company assembles press kits (it charges per-piece) and does target mailings, but only at our request. There is no per-book fee; we pay only the storage and shipping/handling fees.

Monica Wessel, LadyBug Publishing

A Prescription for Satisfaction

We had been working with the medical wholesaler J.A. Majors in Dallas for over a year, and were impressed with how fast, efficient, and courteous it was. So when I found out that the company had a distribution and fulfillment operation (JAMCO) with 60,000 square feet, we decided to set up with it. We needed an end-to-end solution and people who knew the book world, because our distributor was such a disaster–literally, as it turned out, when the warehouse caught fire–and we negotiated a price per transaction (pick, pack and ship, and so on).

JAMCO provides all sorts of services, from collection and billing to helping with our telemarketing and direct mail campaigns, bulk newsletter sales, and so on. Also, we have 800 phone and fax numbers for ordering and customer service that are manned by JAMCO’s personnel.

Joan Mullally, Rebus

Web site: www.rebus.com

Here’s a Horror Story

We did use a fulfillment company, but we ended the relationship five years ago. Then, just last spring, I discovered the company still had several of our titles on its Web site. Yes, it had shipped our remaining stock back to us, but it actually reprinted the books! Although we had grounds to sue, we decided not to go to that expense, and the company has definitely quit selling our titles.

Nancy Rediger, Truman State University Press

The Way We Walk Our Talk

We are a small consulting and publishing firm that focuses on renewal and revitalization for individuals and organizations. Because we believe in walking our talk, we want to be renewed in the midst of our work. So we decided to have a fulfillment company warehouse our books, handle individual orders, and send larger orders to wholesalers, distributors, and clients. That way we can focus our time, energy, and attention on marketing, promotion, and client work.

The printer that my co-author, Suzanne Adele Schmidt, and I used for Running on Plenty at Work: Renewal Strategies for Individuals (Boyd Printing in Albany, NY) also has a fulfillment division. We went with it because its pricing was reasonable and because we would not have to pay to have our books shipped to another location for fulfillment. Boyd takes and fulfills individual orders for us via fax, 800-number, and the Internet (our site is linked to its ordering system). We pay a monthly warehouse fee and a fee for each individual order that it fulfills.

We take the large orders from wholesalers, our distributor, and clients; handle the invoicing; and then ask Boyd to ship the books. The company has been great about responding to orders and shipping requests, getting them out right away.

Boyd sends us a monthly report with information on sales and inventory along with names and addresses of buyers, an invoice for fulfillment costs, and a check for monies collected. We received the reports regularly the first four months but then started having to ask where they were.

Krista Kurth, Renewal Resources Press

Web site: www.renewalatwork.com

A Pro’s Pick

For more than 10 years, I ran a fulfillment company, and when we were getting out of the fulfillment business, we did extensive research to find the company best able to take over. Book Clearing House came out at the top of the list. We were thrilled that it was willing to keep up the service to our clients and that we could use it to handle the parts of fulfillment of our own titles that we prefer to contract out. For instance, I use BCH to handle calls from broadcast interviews and orders from Barnes & Noble.

Steve Carlson, Upper Access, Inc.

Web site: www.upperaccess.com

Cost Comparisons

I started Reyomi Publishing and released our first title, Time Will Tell, in April 1999. Initially, I brought all the books to my home, set up an RPS (now FedEx Ground account), and shipped all orders. I found myself waiting at home all day for the orders to be picked up, and paying a weekly service charge.

When I ran the second printing of Time Will Tell, I learned that for less than I was paying each week, I could store slats of books for a month at my printer (Patterson Printing in Benton Harbor, Michigan). Now I keep a small quantity of books on hand to fill local and small orders, but most of the books are warehoused and shipped from Patterson. I simply e-mail my sales rep with the details of the orders, and the shipment goes out the same day. Each quarter I get a bill from Patterson with information about inventory on hand, shipment details, and costs of shipping and warehousing.

While I do pay a handling fee, it is worth the convenience. I’ve used this same system for the new release, How We Got Over, and it continues to work well.

Trevy A. McDonald, Reyomi Publishing

Web site: www.reyomi.com

Integration with an Invoicing Program

Although I am author of our book, Care of the Dying, I also know a thing or two about the care of living systems in a high-tech world, because I’ve been a high-tech systems engineer. I decided to set about designing and building a prototype invoicing program that would print the necessary forms for shipping from a fulfillment house across town, or one across the country or around the world, from a single Web-based order entry. The program produces a single piece of paper that can serve as packing list, order confirmation, and mailing label, all in one, and that can be printed as an invoice to fit a window envelope. Also, it prints out an inventory tracking physical count sheet that our fulfillment house runs periodically and faxes back to us for count verification between our systems and their physical inventory of books. (Can you tell I used to design accounting and production systems for clients?)

One reason we chose the particular fulfillment house we use–PBP Services–is that it is a local nonprofit production services company staffed partly by developmentally disabled people.

A lot of folks told me I was reinventing the wheel with my system and that it might not be cost-effective for everyone, since most publishers probably can’t afford to have a dedicated programmer tailor a Web order-entry system just for them. But, hey, I couldn’t find any wheel that would do what I wanted it to do. I found plenty of order entry and tracking systems but none with a Web interface that fed nice-looking forms through the process from a single order-entry site, whether that entry site happened to be at my office, an office on the road, a bookstore event, or even my laptop connected to my cell phone at a rest stop between cities. If I can get to the Web, I can check stock and orders, enter orders, or ship. Another module of the system lets customers enter their own orders online, and allows for review before the orders become live items in the system.

So now that we’ve got the fulfillment handled, what we need is more good publicity contacts and networking leads. I wish they could be coded by a programmer.

Jerral Sapienza, LLX Press

Web site: www.LLX.com/order.shtml

 

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