Consumer Electronics Order Fulfillment: Special Handling and Packaging Requirements
Given the complexity and uniqueness of the products in the category, order fulfillment for consumer electronicsand their accessories often requires special handling and/or packaging – both of which have a tendency to increase the costs associated with fulfillment-related operations.
In this post we explore:
Fragility and carrier restrictions
Consumer Electronics Order Fulfillment: Fragility and Carrier Restrictions
Consumer electronics are very fragile. Consider, for instance, devices such as laptops and cell phones which incorporate glass touch screens and/or other delicate parts – all of which are highly susceptible to damage during transit. To minimize risk, sellers often rely on corrugated mailers, preformed protective inserts, and ample void fill. While necessary, keep in mind that these materials increase not only the direct cost of packaging, but also handling and shipping fees (due to increased actual weight or dimensional weight). Additionally, as electronics are susceptible to damage from moisture, their packaging tends to require some form of waterproofing – whether in the form of inner wrapping or bagging, a poly-based exterior, or some combination. Lastly, many types of consumer electronics include lithium batteries which introduce an array of carrier restrictions due to their high combustibility.
A few tips:
When it comes to protective materials, too much is generally better than too little; however, be cognizant of the cost-implications inherent to different packouts.
For larger electronics, a “double-box” packout – an inner box protected by layers of padding packaged within an outer box – is often recommended.
For products containing lithium batteries, sellers should reference the guidelines of their carrier(s) of choice (see: UPS, USPS, FedEx, and DHL).
Consumer Electronics Order Fulfillment: High-Value Items
High-value items inherently present an array of complexities when it comes to warehousing, fulfillment, and shipping – and many electronic devices fall into this category. Storing high-value items, for instance, is an especially unique challenge – often necessitating some form of secure cage (which, naturally, comes at a premium). Further, many manufacturers of high-value electronics require serial number verification and logging when a unit is shipped – thereby creating additional steps in the order fulfillment process. Finally, high-value items typically demand premium shipping methods (Next Day/Overnight, 2nd Day, or Ground) with add-on services (adult signature, insurance, etc.) which naturally puts upwards pressure on costs.
A few tips:
High-value products create a lot of risk from the perspective of order fulfillment providers as a single damaged/lost unit can wipe out a disproportionate amount of fee revenue. As such, premiums are often imposed to adequately compensate providers for the higher level of risk being assumed – if they are even willing to take it on in the first place.
High-value items should never be shipped using economy methods unless adequate losses are built into product pricing models; however, even then, customers spending considerable sums for such an item are unlikely to be comfortable with long and/or uncertain expected transit times.
Consumer Electronics Order Fulfillment: Unboxing
High-end unboxing experiences are common in the consumer electronics space – especially for items sold at higher price points. To an extent, this makes sense as eCommerce customers are likely to form emotional connections with online brands upon receipt of their packages; however, of the many elements which tend to materially drive up fulfillment costs, unboxing is especially notable. For starters, custom packaging materials are almost always more expensive than generic alternatives, but that’s just the beginning. The packout processes inherent to high-end unboxing experiences naturally take more time than regular picking and packing and they also tend to increase both actual and dimensional weight – thereby driving up the cost of shipping.
A few tips:
Unboxing makes for great first impressions, but for resource-constrained firms, it often does more harm than good (by disproportionately driving up costs).
When in doubt, remember that most customers are attracted to a great product at an even better price, regardless of the packaging materials utilized.
The savings generated through the bulk purchase of customized packaging materials are often eroded by higher storage costs.
Consumer Electronics Order Fulfillment: Reverse Logistics
Reverse logistics tends to be more complicated with consumer electronics – especially for higher-value items. Consider, for instance, products which come with warranties and/or insurance plan(s). Ancillary financial offerings such as these are quite desirable both for customers and sellers (because of their profitability); however, they often necessitate the adoption of precise RMA processes for returns or exchanges, inspections, etc. – all of which demand higher levels of care and resources than is otherwise typical.
A few tips:
Clear guidelines for the acceptance of returns and exchanges should be available to customers both pre- and post-purchase. Keep in mind that while liberal return and exchange policies may increase both initial conversion and average order values, subsequent upwards pressure on reverse logistics could easily be sufficient to offset any upfront gains.
Insurance on return shipments is often a must – unless the cost (and associated risk) of return shipping is being borne by the customer.
If possible, limit exchanges – replacements and refunds are easy, but exchanges almost always take additional steps (and, therefore, increase costs).
Order fulfillment for consumer electronics tends to be more complicated – and, therefore, expensive – than it is for many other categories; however, with a little bit of knowledge and proper planning, much can be done to keep costs in check. When in doubt, our advice is to keep things as simple as possible.