What Is Order Consolidation and How Can It Improve Your Customer Experience?

Many ecommerce businesses have been using split shipments to get orders out the door faster and send out items from different warehouses. But this can rack up shipping costs and create extra package waste that isn’t just costly, but also harmful for the environment.

On top of this, customers may be confused and frustrated if they only receive part of their order which could damage their experience with your brand.

The best way to prevent this is by using shipment consolidation so you can keep shipping costs low while improving the customer experience. In this article, we take a closer look at order consolidation, what it is, and how it can lead to more satisfied customers.

What is order consolidation?

Order consolidation is when you send out several individual items from an order in a single shipment. When there are multiple orders going to the same shipping address, they are consolidated into the same shipment so they can be sent out together.

This helps to reduce shipping costs while minimizing package waste and ensuring that customers receive all parts of their orders at the same time.

How can order consolidation help you improve customer experience?

Consolidating your shipments can simplify order fulfillment to a great extent. And this enables you to enhance the fulfillment experience in a number of ways.

Reduced shipping costs & time

When it comes to ecommerce shipping, there are two main factors affecting the customer experience – speed and cost. Fast shipping speed is the number one reason why 62% of shoppers have a positive retail experience. And 64.3% of U.S consumers say that cost is the most important factor when it comes to shipping.

Order consolidation addresses both of these factors, enabling ecommerce retailers to deliver orders faster and at reasonable rates. When you consolidate your orders, it significantly reduces shipping costs because you don’t have to pay for multiple packages and shipments.

And since all items in the order are shipped out at the same time, you can fulfill orders faster and customers won’t have to wait for certain items to arrive much later.

More sustainable shipping

Order consolidation allows for more eco-friendly shipping since it uses less packaging material and fuel. With more orders packaged and shipped together, it enables you to reduce your carbon emission and lessen the environmental impact of your ecommerce operations.

As more shoppers are developing a deep concern for environmental issues, this allows you to positively influence how they feel about your brand.

Consumers, especially younger generations, are now choosing brands based on their environmental impact and practicing green commerce could help you appeal to this eco-conscious group. In addition to buying more eco-friendly products, millennials are also buying from brands that make conscious choices to protect the environment. Moreover, 52% of U.S and U.K consumers want brands to create products with less packaging.

So consolidating your shipments is the perfect way to meet these consumer expectations.

Simplified shipment tracking

Another way that order consolidation improves the customer experience is by simplifying how customers can track their orders. Since all parts of the order are in the same shipment, customers can easily see the movement of their order without having to figure out which item belongs to which shipment. Instead, you can set realistic and transparent expectations by updating them with the transit status of a single shipment.

Improved order accuracy

With consolidated shipments, you get to collect and review all the orders before they’re shipped out. This makes it easy to quickly see if the order is complete and accurate before it’s ready for shipping and significantly reduces the risk of sending out incomplete or incorrect orders that could ruin the customer experience.

Order consolidation can lead to better order accuracy, which not only improves the customer experience but also minimizes the need for returns.

How does order & shipment consolidation work?

Order and shipment consolidation requires effective collaboration between different players and partners in your fulfillment process. So in addition to knowing how the process works, it’s important to follow the best practices that will enable you to streamline and optimize your effort.

Collaboration with trusted partners

For successful order consolidation, you need to collaborate seamlessly with all parties involved. This may include business partners, fulfillment centers, and distribution companies. But more importantly, you need a trusted shipping partner to professionally consolidate your shipments for you.

Your shipping partner plays a vital role in the whole process as they’re responsible for ensuring that the order is complete and accurate, then they must package and deliver it to your end customer. This is why it helps to partner with a professional 3PL that can also offer warehousing and picking and packing services. That way, you get to leave the entire process to them and minimize the risk of disruptions or mistakes that may occur when there are too many parties involved.

Mutual agreement about processes

To make your collaboration work, it’s important that you determine and define the full consolidation process at the start. Clearly outline who is in charge of what and how to make your partnership work.

Will you provide your shipping partner with the products as orders come in? Will they be in charge of packaging and reviewing orders as they consolidate them? Or will you send your whole inventory to them so they can also handle storage in addition to picking and packing and logistics?

Agreements may vary depending on how you want to work and the level of service your partners offer. So it’s important to thoroughly define everything upfront and prevent problems before they even happen.

Careful implementation

One of the most challenging aspects of the order consolidation process is implementation. With a high risk of mistakes, delays, and disruptions, this needs to be carefully planned and spaced out to curb the negative impacts. As such, the entire order consolidation process heavily relies on testing different aspects of the operation.

As you prepare for implementation, you may want to run test transactions with different trading partners and shipping companies so you can finalize the best partners for your business. This stage will also help you identify any issues or potential improvements before you finalize the process.

But don’t be too quick to jump into final implementation because you still need to audit the test transactions and review them for compliance and accuracy. You can then make a decision about how to proceed, which partners to work with, and how the process should work.

How ShipBob helps companies improve customer satisfaction

Order consolidation can’t happen without a trusted shipping partner. That’s why you need a reliable 3PL provider like ShipBob to handle order consolidation, order fulfillment, and inventory management for ecommerce companies at scale.

ShipBob lets you store your inventory across our distributed network of fulfillment centers, so you don’t have to worry about warehousing. That means we manage your inventory for you and accurately pick and pack orders to get them ready for shipment. By improving your order accuracy rates, we help you deliver exceptional customer experiences to boost loyalty.

Our distributed fulfillment network allows us to ship out orders from the nearest fulfillment center. That means shipments spend less time in transit and reach your customers’ doorsteps faster, sometimes in as little as two days. Shorter journeys also mean reduced shipping costs – all of which lead to better customer satisfaction.

“After working with ShipBob and seeing the initial 20,000 – 30,000 units go out the door, it allowed me to sleep better at night. We weren’t having to spend a lot of time processing orders, and we were very relieved that we were being taken care of. As we’ve grown internationally and in our general order volume, we’ve seen satisfaction go up. ShipBob was a key player and significant partner in helping manage what became unmanageable when we were shipping orders out ourselves.”

Matt Dryfhout, Founder & CEO of BAKblade

ShipBob’s technology integrates seamlessly with your ecommerce platform so you can provide your customers with better transparency into their order status. From automatic confirmation emails to real-time transit status – you can meet customer expectations with accurate order tracking.

With order consolidation being the ideal way to enhance customer satisfaction and keep shipping costs low, ShipBob optimizes to not split shipments. But if you need us to, we can. Sometimes, orders may get stuck in Exceptions because one or more items are out of stock. If you wait to ship out the entire order until the out-of-stock items are available, it may cause drastic delays that could disappoint and frustrate customers.

ShipBob gives you the option to split the order so the available items are shipped out as soon as possible. And once the missing product arrives via a warehouse receiving order (WRO), then the rest of the order will also be processed automatically.

 

Order & shipment consolidation FAQs

Here are answers to the most common questions about order consolidation.

Does order consolidation make shipping cheaper?

Yes, order consolidation reduces the number of packages and shipments, which can significantly bring down the cost of shipping.

What is consolidation in the warehouse?

Consolidation in the warehouse is the process of collecting small shipments from multiple suppliers into one storage facility, where they are combined to create larger shipments that are more economical.

Does ShipBob consolidate orders?

ShipBob optimizes every shipment to consolidate orders and avoid splitting them. This helps to keep costs low while speeding up deliveries and enhancing the order fulfillment experience. However, you have the option to split orders that are in Exception when one or more items are out of stock.

What are consolidated shipments?

Consolidated shipments are orders containing multiple items that are sent out in a single shipment rather than as several separate shipments.