Understanding and reducing processing time

Processing time is the time between when an order is placed by a customer and when the order is fulfilled by the business. Orders that require shipping are considered fulfilled when the business gives the shipment to a shipping carrier service.

Reviewing an order, printing shipping labels, packaging products, and handing over shipments to a shipping carrier all contribute to an order's processing time.

The section of an order's timeline that makes up the processing time

Depending on your business, you will have a different amount of control over your processing time. If you dropship, then your only control is over which suppliers you work with and how quickly you place your orders with them. If you ship products yourself, then you control everything from how quickly you package the product to when you drop off shipments to your shipping carriers.

Impact of processing times

Faster processing times can offer the following benefits:

  • Less expensive shipping - You might have the option to choose slower shipping options and still have shipments arrive in reasonable timeframes.
  • Higher customer satisfaction - When a customer receives an order quickly, it can increase their trust in your business and provide a positive experience. This can lead to a higher chance of the customer ordering from you again.
  • Inventory moves faster - If you store your products in warehouses, then having your products spend less time on the shelves can reduce warehousing costs.
  • A more efficient fulfillment process - By improving your processing time, you can make sure your employees are working efficiently and there are no unnecessary labour costs.

Slower processing times can cause the following problems:

  • Support debt - Customers might contact you to get updates on their orders, and replying to them can take up a lot of time.
  • Unmet expectations - Some customers might expect orders to arrive in only a few days. If a business doesn’t meet their expectations, then a customer might not order from that business again.
  • Higher costs - Inefficient processing times can lead to employees working longer hours and products taking up space on warehousing shelves, both of which costs a business more money.

Understand your processing times

When you understand each step that you take to process an order, you can often find ways to make your fulfillment process more efficient. Removing unnecessary steps, combining two steps into one, or having two tasks happen at the same time can help reduce your processing time.

Step 1 - Group your products

Consider the processing steps for each product that you sell. If any products share the same steps, then group them together.

For example, suppose that you sell T-shirts, hats, and jewelry. To process orders for hats and T-shirts, you might need only to place them in a padded envelope, print a shipping label, and deliver the envelope to your shipping carrier. However, to process orders for jewelry, you might need to do a final polish of the product, put it in a small jewelry box, decorate the box, place it in a delivery box, print a label, and then deliver it to your shipping carrier. In this scenario, you would have two groups of fulfillment processing.

Step 2 - Create a list of processing steps for each group of products

For each group of products, list each step that you take to process an order for a product in that group.

For example, suppose that you sell prints of your artwork and print them on demand through a local printing company. Your fulfillment process could be as follows:

  1. Open the order email.
  2. Review the print requested, then open your email client and start an email to the local printing company.
  3. Upload the print file to the email, then send the email.
  4. Wait for an email confirmation from the printing company that the print is ready.
  5. Drive to the printing company, pay for the print, and then collect the print.
  6. Drive home.
  7. Package the print.
  8. Purchase and print off the shipping label and attach it to the package.
  9. Drive to the shipping carrier’s drop-off location.
  10. Drop off the package.

Step 3 - Give each step extra details

Add extra details to the steps, such as the following:

  • The length of time each step takes
  • Any extra actions needed from you
  • Any extra materials required for the step

Step 4 - Create processing steps for orders that have products from different groups

For example, consider the hat, T-shirt, and jewelry store scenario from step 1. You would need a separate set of steps for orders that include packing both a hat and a piece of jewelry.

Improve your processing times

After you understand your steps to process an order, consider the following way to improve each process:

  • Highlight any steps that can be prepared in advance. For example, preparing the box or moving stock from the stockroom to the shipping station.
  • Automate any manual tasks as much as possible.
  • If you use Shopify Shipping, then purchase shipping labels in bulk.
  • Find any steps that can happen at the same time. For example, if a step requires you to wait 15 minutes, then consider if a later step could be done during that time.
  • Remove any unnecessary steps.

For example, you could improve the art print fulfillment process from step 2 in the following ways:

  • Steps 1-3 could be combined - Upload all your prints to a cloud-based file storage service, such as Google Drive or Dropbox. Give your local printing company access to the prints. Set up your local printing company as a custom fulfillment service in your Shopify admin. Finally, adjust your Shopify settings to automatically fulfill orders.

    With this setup, when an order is placed in your store, your local printing company receives an email right away with all the details, and they can access the print through the cloud-based file storage service.

  • Step 8 can happen during step 4 - While you wait for the email confirmation from your printing company, prepare the package by printing off the shipping label and attaching it to the package.

  • Step 6 can be removed - If you prepare the package and label before picking up the print, then you can package the print as soon as you receive it, and then drive directly to the shipping carrier’s drop-off location.

After you've made the changes above, your fulfillment process would be as follows:

  1. Open the order email.
  2. Purchase and print off the shipping label and attach it to the package.
  3. Wait for an email confirmation from the printing company that the print is ready.
  4. Drive to the printing company with the packaging, pay for the print, and then collect the print.
  5. Finish packing the product.
  6. Drive to the shipping carrier’s drop-off location.
  7. Drop off the package.

Refer to the following list to explore other ways to automate your processes:

Explore fulfillment center options

If processing orders yourself becomes too time consuming, then consider working with a fulfillment center. Fulfillment centers process and ship orders on your behalf, which frees up your time to focus on other areas of your business.

Consider exploring the following options:

Plan ahead

If you plan a sale or run a business that is heavily impacted by the time of year, then make sure that your business is prepared for a higher volume of orders.

Below are some ways that you can prepare:

  • Make sure you have enough help.
  • Prepare your products a few days before the events.
  • Make sure you have enough shipping and packing materials, such as boxes, tape, mailers, printer paper, ink, and labels.
  • Know the cut-off time of your main shipping carrier and plan around these times. For example, if your carrier doesn’t accept shipments after 4:00 pm, then complete all your orders by 3:30 pm.

To help you plan for future events, make notes of things that you run out of or steps that took a long time. Consider whether more staff would have decreased your processing time, or if there are ways to automate any time-consuming manual tasks.

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