The Benefits of Outsourcing Product Distribution
One of the most important aspects of running a business is product distribution but it can also be one of the hardest to manage as well. The logistics of finding somewhere to store your products and then transporting them out to stores or customers can be a nightmare to figure out.
Product distribution ends up being the downfall for many companies. Problems in this area bleed out into other facets of the business. And result in a major loss of revenue that’s hard to overcome.
Even knowing how difficult it can be, many business owners avoid outsourcing product distribution and try to manage on their own. Life and business would be much simpler if they let the experts take control of these tasks and focused on their specialty.
Read on to learn all the benefits of having a distribution partner for your small business.
More Effective Processes
It’s so easy for product distribution systems to become inefficient very quickly. There are so many details to manage to get from product assembly to get them to stores, things can get missed in the mix of things.
Too often businesses find a system that works and stick with it for far too long. Instead of updating the process with new technology or structures, they let their company continue with what was good in the past. This can lead to major delays, product loss, or lower profit margins. Efficiency is key in product distribution and that means constant evolution.
Working with a product distribution center means you have access to all of the latest systems in the industry.
These professionals keep a sharp eye out for any areas of the process that are slowing things down or not running as smoothly as they should. They then implement changes to resolve those issues as fast as possible to keep your products moving to where they need to go.
Variety of Transportation Types
Transportation is an integral part of product distribution. In fact, none of it could happen without a variety of types of vehicles to move your shipments from place to place. But the industry is so vast, it can feel very overwhelming to try to figure out the best way to utilize the options in front of you.
Many business owners don’t have access to larger transportation operations because of how small their loads will be. Utilizing your distribution partner can help you tap into a whole new transportation arena.
Not to mention how much relief you’ll feel when you don’t have to figure out all of the logistics of moving your products. They can handle scheduling routes, managing port documentation, and all the other details that go into moving large shipments. These teams have relationships with many transportation vendors that can help get the job done.
For many of these transportation vehicles, larger shipments are needed to make the travel worth it. So working with a larger distribution partner can help get your products in with others to create the necessary volume.
Ability to Sustainably Grow
For most businesses, growth is a major priority. They want to scale all of the behind-the-scenes aspects of the company so that they can sell more products and have a larger revenue.
But too many businesses push this growth too quickly and end up burning out. They can’t sustain the resources they’ve taken on and have to close down prematurely. Growth needs to happen in a systematic and logical way that builds piece by piece. This is the only way you can maintain what you’re building.
One of the ways businesses scale too fast is by trying to get their own distribution resources when they don’t have the backing (or really the need yet). Utilizing an already-in-place partner for warehousing and transportation can save you from this mistake.
A business can have access to all of these tools without the major investment of getting into them themselves. They can utilize their partnership but only for the amount they need, which can grow slowly and organically.
Larger Warehouse Opportunities
There are very few times in business when you have a product that needs to go straight from assembly to where it will be sold. More often, it will need to be stored in a warehouse for a time period. Actually, this storage time is very helpful in making sure you always have the products you need to fulfill customer orders.
But finding a warehouse can be very difficult. There are often very limited spaces available, if any at all, that will work for what you need. And they can be very expensive or out of reach.
A huge benefit of working with a distribution partner is having more open access to large warehouse spaces.
These businesses have many spaces already in place, so you can have exactly what you need right away. There’s no need to make sure everything is set up correctly either. These teams can help create a system that works for your specific product lines that will keep your process moving forward.
Inventory Management Services
Having inventory is key to building a lasting small brand that has satisfied customers. There’s nothing more frustrating than wanting to purchase something and finding out it’s out of stock. Businesses can miss out on a lot of revenue when this is a regular occurrence.
It’s important to keep a balance on the inventory; having just the right amount to fill orders but not too much to lose money in production. This means a business needs to have a very clear snapshot of its inventory at all times. But keeping track of everything within your storage center can be very difficult.
Many warehouse and distribution partners will also handle inventory management as well. They will help monitor the products as they move in and out of the warehouse.
These systems make it easy to figure out what needs to be ordered and when so you always have the right amount of product on hand.
Cost Effective Strategies
A concern for many businesses is that they’ll end up losing money when they choose to partner with a distribution company.
There are already so many expenses involved in running a successful company, it’s hard to add something else to the mix without a little extra worry. But this kind of investment can completely change the way a company operates and end up saving them so much money in the long run.
Not only do their effective transportation and warehouse strategies help save money, but it also eliminates the need for hiring and retaining more employees.
Any employee is a huge expense for companies. Even beyond their pay, you have to consider all of the time it takes to train as well. Letting other partners handle those warehouse and transportation employees eliminates so much from the company’s bills. Not to mention the time you’ll save not having to manage these extra employees on a daily basis.
A product distribution team works to find ways to lower your bottom line and make your products more profitable. Their expertise helps to make small changes to your systems to achieve that aim.
Eliminate Lead Time Issues
In order to develop a good reputation for your small business and keep your customers happy, it’s helpful to have as short of a lead time as possible. This means there is a small window between the time a customer places an order and when it shows up at their door. Keeping this kind of timeline on a consistent basis requires your processes to run very smoothly.
Working with a distribution partner is a great way to ensure that that’s the case for your company.
Once your products are made, they can be kept in the warehouse where they can promptly be shipped out using the transportation network when needed. There’s no need to coordinate with several different areas of your business, it’s all happening in the same place and with the same group.
There’s less room for error when you can consolidate aspects of your business like this and leave it to the professionals to manage.
Custom Packaging Options
Successful small businesses work very hard to create a solid brand foundation. Their branding is how their products are presented to the world and what makes them recognizable (and more appealing) to customers.
Some business owners worry that utilizing a large distribution partner will eliminate their opportunity for branding their products.
For the most part, this isn’t the case! Businesses still have control over the branding that’s part of their products and can customize those to look and function how they want. They can work with the fulfillment team to ensure that all of their products have the right packaging, including tracking and bar codes.
These extra steps are what make products stand out among the competition. It also helps the business make sure everything is handled correctly and shipments go out just how they are designed to be.
It may take a little extra effort and time to figure this step out but it’s well worth it to continue to be true to your brand.
Creates a Professional Network
Building a business from the ground up is a very difficult task. There are so many things you have to figure out, it can be extremely daunting. Having a network of professionals to call on can make all of it much easier.
Working with a professional distribution partner is a great way to start building that network. Through these relationships, you can tap into years and years of experience to learn from. Instead of going through so much trial and error, a business owner can see what has and hasn’t worked for other companies in the past and apply that to themselves.
A network of business professionals can also be a great resource for staying on top of advancements and improvements in the industry. Word will travel about new strategies or technologies that can be implemented into all kinds of operations.
These relationships, advice, and guidance can be invaluable to any size company no matter how old or young they are.
One professional relationship often leads to another as well. So a business owner could potentially be linked with several other professionals who can give a boost where needed.
There’s simply no way a business owner can handle every responsibility on their own, at least not for a long time or at a high level. It will eventually become too much to bear and things will start to fall through the cracks. The better route to take is to outsource the things that they can so they can focus on what only they can do.
Unless the business owner is a logistics, fulfillment, warehousing, or shipment expert, chances are that true professionals can handle these tasks better than they could.
This relief of responsibility not only makes it easier to focus on other tasks, it often means those responsibilities are handled more effectively altogether. Customers and other business partners will be able to see the difference in the company and how it’s run with these kinds of relationships.
Outsourcing is a great way to continue to love to run a business and avoid feeling overworked and burnt out.
Benefits of Outsourcing Product Distribution
Any business that is product based has the same goal; to get its product into as many customers’ hands as possible in the most effective way. Every decision should be based on getting your company towards that aim.
Outsourcing product distribution is a huge step that can help your company push forward. Instead of constantly dealing with logistic problems while also managing every other aspect of your business, you can simply leave it to the professionals. These experts have the experience to implement consistent, effective systems for your business.
Both you and your customers will be happy with the investment into working with a distribution partner. If you’re interested in seeing how our team can help your business, contact us today!