Online Order Fulfillment Best Practices for Dietary Supplement Sellers
A valuable nutraceutical fulfillment center is a critical partner for supplement manufacturers, nutraceutical sellers, and internet retailers. Below we’ll outline important issues to review when choosing a fulfillment partner for supplement sellers, including best practices for supplements fulfillment, what services and benefits fulfillment centers should provide nutraceutical retailers, how subscription fulfillment adds revenue and an overview of inventory systems to consider.
What is considered a nutraceutical?
The official government term is dietary supplements, and it includes any pharmaceutical grade nutrient consumed for a health benefit, often commonly called vitamins, herbs, minerals, extracts, nutraceuticals, teas, concentrates and botanicals. And it’s a growing lucrative online business, expected to top $700 billion by 2025, with online sales supporting much of that growth. For merchants looking to maximize revenue as they grow, there are business benefits to capitalizing on a partnership with a third-party logistics partner (3PL).
What is an example of a nutraceutical?
There are many types of nutraceuticals, here’s a list of some of the most common:
- Mineral supplements
- Dietary fiber supplements
- Omega-3 fatty acids (i.e. fish oil)
- Fortified food & drinks
- Green tea
- Herbal products (i.e. ginger, turmeric, garlic, etc.)
What is nutraceutical fulfillment?
Nutraceutical fulfillment is a process that involves storing nutraceutical inventory and the processing of customer orders including picking nutraceutical products from inventory, packing them for shipment with tracking labels, and delivering those packages directly to customers.
Topline Benefits of Working with a 3PL for Dietary Supplement Manufacturers
Low shipping rates
- Fulfillment centers pass along volume discounts on shipping
- Variety of packaging options means the box fits the product; boxes that waste space also cost more to ship
Reduced packaging costs
- Fulfillment centers get volume discounts
- Buy packaging as you use it
- Don’t have to store packaging supplies
Reduced tech costs
- Cost of warehouse tech is amortized across many clients
- No lost time to training, implementing and using inventory technology
- Cost of carrier integration is also spread across many clients
Reduced staffing costs
- No management, recruiting, benefit or salary costs to manage
- Don’t have to manage staff for peak seasons
For more on the cost benefits of working with a fulfillment center, get a quote.
Best Practices of Fulfillment Centers Working with Dietary Supplement Merchants
There are several key priorities that a fulfillment center should focus on when packing and shipping dietary supplements. For merchants looking to work with a warehouse or fulfillment partner for distribution, it’s a checklist for services and capabilities:
- Quality control: Ensuring the quality and effectiveness of dietary supplements is of the utmost importance. Fulfillment centers should have strict quality control processes in place to ensure that products are handled, stored, and shipped in a way that preserves their quality and effectiveness. This may include maintaining proper temperature control and handling products with care to prevent damage.
There are several points of the fulfillment process for nutraceuticals that should include quality control skills.
When dietary supplements are shipped straight from the manufacturer, a fulfillment center’s receiving team will spot check products for quantity accuracy by SKU, but also check to see that products have arrived in good condition. At this time, the warehouse may record expiration dates, batches, lot numbers or best-by dates that are important to determining which items are moved out of inventory first.
Additionally, when picking and packing supplements, fulfillment centers with nutraceutical experience will have inventory management systems that move the products that are expiring first out of the warehouse first. They will also have alerts for clients, noting when products are getting close to sell-by dates, or within a specific window of the expiration date.
NOTE: For companies hoping to use a fulfillment center to prep dietary supplements to send to Amazon, for Fulfillment By Amazon (FBA), look for a fulfillment partner that knows Amazon regulations. For example, Amazon won’t accept nutraceutical inventory that has an expiration date within 90 days of receipt. Distribution centers offering FBA Prep services for dietary supplements should be able to prevent sending inventory that will get refused when it arrives at Amazon.
- Accurate and timely fulfillment: It is essential for a fulfillment center to be able to accurately and promptly fulfill orders for dietary supplements. This may involve tracking inventory levels in real-time and using advanced technology to streamline the picking, packing, and shipping process.
- Compliance with regulations: Fulfillment centers handling dietary supplements should be familiar with and compliant with all relevant regulations, including those set by the FDA (Food and Drug Administration) and other regulatory bodies. This includes proper labeling, packaging, and handling of products.
- Customer service: Providing excellent customer service is critical for any fulfillment center, and this is especially important when it comes to dietary supplements. Supplement fulfillment companies should have a knowledgeable and responsive customer service team to handle any questions or concerns that may arise.
- Security: Protecting the security and confidentiality of customer information is also a top priority for a fulfillment center handling dietary supplements. This may involve implementing measures such as secure data storage and handling, as well as strict privacy policies.
Ecommerce Definition: What is the nutraceutical industry?The nutraceutical industry consists of merchants selling dietary supplements, functional foods, and herbal products. The nutraceutical industry is booming and expected to continue to grow over the next few years leaving the door of opportunity open for sellers looking to make a profit.
What To Look for in Choosing a Nutraceutical Fulfillment Center
Dietary supplement merchants rely on fulfillment centers to accurately track inventory, provide climate controlled warehousing, kit and bundle products, and offer reliable expert service. Here are some key characteristics of a valuable nutraceutical fulfillment center:
1. Accurate inventory technology: In today’s multi-channel marketplaces, it is essential for supplement manufacturers to have a fulfillment partner with advanced inventory technology. This technology should be able to track inventory levels in real-time, across all sales channels and market places, to ensure that orders can be fulfilled promptly and accurately.
2. Climate controlled warehousing: Nutraceuticals can be sensitive to temperature changes, and so it is essential for a fulfillment center to have climate controlled warehousing. This will help to ensure that products are stored in an appropriate temperature range, preserving their quality and effectiveness. While most nutraceuticals use vacuum-sealed packaging, and employ desiccants like silica gel, molecular sieves or activated clay, to protect against humidity, the products inside can still be affected by heat. Add long shelf-times, and temperature swings can impact product quality.
3. Kitting services: For internet retailers, a valuable nutraceutical fulfillment center should have the ability to kit and bundle products together, which can help to increase the average value of online orders. 3PL companies can also handle the entire fulfillment process, from receiving and storing products to picking, packing, and shipping orders.
4. Reliable expert service team: Online merchants need a fulfillment center with a reliable expert service team. This team should be able to handle any questions or concerns that arise, and be able to provide timely and accurate responses. They should also be able to offer advice and guidance on the best fulfillment strategies for a given business, and be able to adapt to changing needs and requirements.
A reliable, trust-worthy nutraceutical fulfillment center is a critical partner for supplement manufacturers, nutraceutical sellers, and internet retailers. These organizations rely on fulfillment centers to accurately track inventory, provide climate controlled warehousing, kit and bundle products, and offer reliable expert service. By ensuring that these characteristics are in place, nutraceutical fulfillment centers can help to ensure the smooth and successful operation of these businesses.
Online Fulfillment Trend: Using Subscriptions to Boost Nutraceutical Revenue
Because dietary supplements are a consumable product, many merchants are adding subscription options to their product choices. Here are strategies online retailers can use to encourage customers to increase average order revenue volumes or encourage repeat customers.
Offer a subscription at a reduced rate
If your product is a 90-day supply, offer clients a subscription at a reduced rate and automatically send another online order in 90-days. The reduced marketing costs of having a repeat customer will easily cover the cost of the reduction. Any vitamin, dietary supplement or mineral that is regularly consumed is a great candidate for subscription fulfillment models.
Trial sample sizes in subscriptions
To encourage trial of new products, kit sample sizes into your fulfilled subscription orders as a surprise and delight. Sellers will encourage current customers, who already love their products, to add new items to future online orders.
Cross-promote items in a monthly subscription
If usage isn’t easily predictable, retailers can offer a subscription that crosses product lines, offering a different product every month. This strategy works nicely for products that have many different flavors.
Kit products together and offer the bundle at discount
Bundle multiple products together to increase order volume, and reduce fulfillment costs. Learn more about the benefits of bundling in, Why Should Amazon Sellers Bundle Products?
Send soon-to-expire products as samples
Instead of wasting a product that will expire soon by throwing it out, send it out as a promotional sample in every online order. Allow enough time to properly use the product (certainly not after it’s expired.) New orders, inspired by the free sample, will get the new lot, with the preferred shelf life.
Comparing FIFO & FEFO: Understanding the Dietary Supplement Inventory Management Systems
First in First Out (FIFO) and First Expired First Out (FEFO) are two inventory management systems that are commonly used by fulfillment centers and warehouses to keep track of seller inventory and ensure that products are sold or used before they expire. Both systems have their own unique benefits and drawbacks, and it’s important for online retailers and internet merchants to understand the differences between them in order to choose the right system for their needs. And to find an online order fulfillment warehouse that can perform that system.
At a high level, FIFO is a system in which the first products that are received or manufactured are also the first ones to be sold or used. This means that products with the oldest “shelf life” are prioritized over newer products. FIFO is often used in industries where products have a limited shelf life, such as food and beverage, pharmaceuticals, and nutraceuticals. In general, FIFO is used if a perishable product doesn’t have a printed sell-by date, best-by date or expiration date.
Online supplement retailers using FIFO without a printed expiration date, may need to find other means of managing inventory, rather than containing un-marked SKUs all in the same bin. The fulfillment partner may recommend that new shipments of the same product are stored as different SKU, allowing all inventory of the first SKU to be ordered and shipped first. Then switching orders to the newly produced SKU when the first batch is sold out.
FEFO is a system in which products are sold or used based on their expiration date. Often that date is printed on the product and can be called a sell-by date, best-by date or expiration date. It’s especially effective in the dietary supplement industry, because products with the earliest expiration date are prioritized over those with later expiration dates. FEFO is commonly used in industries where products have a longer shelf life and the age of the product is not easily discerned. The main advantage of a distribution center that can manage a FEFO system is that it helps internet merchants avoid having to dispose of expired products that could have been sold.
NOTE: Do nutraceuticals need FDA approval? Production facilities of dietary supplements, often called nutraceuticals, are required to register their facility with the Food and Drug Administration (FDA). When it comes to regulations, we recommend going straight to the source; here’s info from the FDA on dietary supplement regulation:
The Importance of Choosing an FDA Approved Fulfillment Center for Nutraceutical and Dietary Supplement Manufacturers
The FDA (Food and Drug Administration) plays a vital role in ensuring the safety and effectiveness of nutraceuticals and dietary supplements. When it comes to fulfillment centers, it is important to choose a facility that is FDA approved, as this ensures that the products being handled and shipped meet the necessary standards for quality and safety.
FDA approved fulfillment centers are required to follow strict guidelines for handling, storing, and shipping nutraceuticals and dietary supplements. This includes maintaining proper temperature control to preserve the quality and effectiveness of the products. These FDA approved fulfillment centers understand that products are to be properly labeled and packaged in accordance with FDA regulations and can point merchants to resources.
In addition, working with an FDA approved fulfillment center can help to protect against potential liability issues that may arise if products are mishandled or shipped improperly. By partnering with a facility that has demonstrated a commitment to meeting FDA guidelines, nutraceutical manufacturing companies can help to ensure that their products are safe and effective for their customers.
The importance of having FDA approved fulfillment centers, like eFulfillment Service, when picking, packing, and shipping nutraceuticals and dietary supplements cannot be overstated. These facilities provide a level of quality and safety that is essential for the success of any nutraceutical or dietary supplement business.
Ecommerce Definition: What is the difference between functional food and nutraceuticals?:There isn't any difference between the two. Functional foods, also known as nutraceuticals, are nutritious foods that are associated with health benefits.
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