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Posts Tagged ‘fulfillment services’

Amazon… How Does a Publisher Compete?

Amazon and the Publishing IndustryAmazon has and continues to invest millions on systems, readers, selling books at the cheapest price, and the biggest selection. Every day, it seems like there is another article talking about how Amazon is dominating the publishing industry and their goal to put publishers out of business. Amazon has decimated retail book stores, established a clear dominance in the e-book market (and growing stronger), has become a publisher and now they have set their sites on destroying local retail with same day delivery.

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Why Publishers Benefit from Outsourcing

As a publisher and as a business leader, you have to be able to delegate certain tasks in order to keep your perspective and generate ideas to grow the business. This is true even if you run a small publishing house. However, when you don’t have the talent in-house, the question becomes, should you hire or outsource? Many publishers, large and small, are finding great benefits to outsourcing fulfillment services.

The six primary reasons to outsource order fulfillment services are:

  1. Organizationally Driven Reasons
  2. Improvement Driven Reasons
  3. Financially Driven Reasons
  4. Revenue Driven Reasons
  5. Cost Driven Reasons
  6. Employee Driven Reasons

First, I will discuss the organizational reasons to outsource order fulfillment services in greater detail…

By focusing on what they do best, a publishing house can enhance the overall effectiveness of the organization. Typically, publishers are great at developing content and managing the editorial process. Managing the fulfillment services seems to be a secondary thought, and not many publishers can claim to be experts at warehousing. The real questions to ask are:

Do you really want to be an expert warehousing company or a great publisher? Which skill sets will make you a successful publisher?

As you develop the book publishing services, it will be necessary to increase flexibility in order to meet the ever-changing business environment. The retail book trade is continuously asking for books to be handled in a different manner so the retailer can increase sales or make their operations more efficient.

By outsourcing the order fulfillment, transforming the organization becomes achievable. Many publishers who focus on warehouse fulfillment are operationally driven. But, when order fulfillment is outsourced, the publisher can redirect their focus from operations to sales. Many of these publishers can find that being sales and marketing driven results in greater success and adds to their bottom line.

Outsourcing book fulfillment is an excellent method for improving customer service offerings, increasing customer satisfaction and shareholder value. When a publisher can deal with an expert in the warehousing industry, such as Ware-Pak, it will improve the customer’s satisfaction with the organization.

Over the next several weeks I will be discussing each of the remaining five reasons, one at a time, in greater detail. The combination of these blog entries will also be available as a white paper shortly. If you are interested in receiving this white paper, please feel free to contact me directly. I can be reached at (708) 587-4116 or kshay@ware-pak.com

Eliminating Fixed Costs Key To Surviving Economic Downturn

Publishers feeling the pinch are looking for ways to cut back on costs without sacrificing quality service. Many have turned to outsourcing warehousing and fulfillment services as a way to eliminate fixed costs and increase supply chain efficiency.

Outsourcing warehousing services allows you to accomplish two main goals:

  1. Redirect your focus on your core business
  2. Convert a fixed cost into a variable cost

Today, I am focusing on the second goal – converting a fixed cost into an expense that can fluctuate with sales.

For publishers who handle their own warehousing, one of the hardest (if not impossible) things to do is to cut expenses by an amount equal to their decrease in revenue. This is because the biggest expenses are fixed expenses:

  • Rent – Landlords don’t care whether your building is running at 80% or 60% of capacity. They still want 100% of their rent.
  • Utilities, taxes, depreciation and building maintenance costs remain fixed whether the warehouse is at 50% or 60% of capacity.
  • Labor costs in the warehouse are very difficult to cut, especially if you already have a small staff.

By outsourcing, these items become variable costs, not fixed expenses, AND the responsibility for managing them is shifted to your fulfillment center. If orders drop by 10%, the charges for picking will be reduced by that amount. When you look at your inventory and decide to remainder a slow moving item, your storage costs (rent) will fall by each pallet you remove from the facility. In other words, your expense will fluctuate in a manner that corresponds to your level of activity.

Another advantage offered by Ware-Pak – Virtual Warehouse technology – helps publishers eliminate excess stock. Customers view their inventory items and orders being processed in real time. They see which items need to be replenished and which are fully stocked – eliminating excess.

Finally, because warehousing is our only business, outsourcing to Ware-Pak means more same-day shipments. Our performance records show that 90% of all files received by 5:30 PM CST will ship the same day – 98% within 24 hours.

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