Consumer packaged goods (CPG) sell big on ecommerce. While buying in bulk is cost-efficient for the consumer, fulfillment can be expensive for brands. CPG beverage brands, in particular, are facing a unique set of challenges in managing costs and maintaining margins. Ecommerce adds complexity these businesses may not experience in their retail fulfillment. However, it’s critical to understand the three key areas that can make or break your ecommerce beverage fulfillment. Because liquids are free-flowing and often heavier items, shipping requirements are more rigorous to protect your brand, the end consumer and the various supply chain stops along the way.
Read on for our tips around packaging, storing and delivery to learn how to improve your fulfillment (and sales).
Your packaging creates the first impression of your brand. For beverage brands, there are infinitely more considerations than just a novel unboxing experience. Protecting your product is paramount as it makes its journey to the consumer. Even with a FRAGILE label, liquids go through the same machines and rough-and-tumble tossing on and off trucks, no matter the carrier. No supply chain is fully damage-free but there are ways to minimize breakage and leakage with the right kitting and packaging. Amazon requires beverage brand packaging to withstand a three-foot drop test—five times. That means your items must be leak- and break-free when dropped onto a hard surface at various angles.
CPG beverage brands would be wise to consult with packaging experts to overcome fulfillment obstacles. An experienced third-party logistics (3PL) provider, for example, has direct relationships with packaging manufacturers and can perform product configuration testing to determine the right kitting, packing materials and box for your beverage. If you’re new to DTC, your retail product may not stand up to the temperature and pressure rigors of the ecommerce supply chain. For example, if your beverages routinely explode during delivery but are fine on retail shelves, the root cause may be in manufacturing. A savvy partner can help troubleshoot and solve these issues to lower your damage rate and increase customer happiness.
Where you store your product can significantly impact the bottom line. Although centralizing all your inventory in one location may seem cost-effective, what really matters is how close your product is to customers. With a single facility on the East Coast, you’ll spend significantly more to ship across the country, whether air or ground, versus having strategically located facilities. This is especially true as the weight and size of shipments increase. Using multiple facilities, however, can decrease your reliance on air travel and get you closer to customers with less damage.
Expiration data tracking and prioritization should also factor into your choice of warehousing facilities. Amazon maintains a black box around this important information for CPG brands, which adds to the CPG beverage brand headache. At Whitebox, we recommend our beverage clients follow a first-expiration, first-out (FEFO) approach, so we ship out what expires first. Offering expiration date transparency to customers can even move more product. We’ve seen increased sales as a result of this strategy, in particular for brands that know their product’s true shelf life is longer than the expiration date.
Not all carriers are created equally. FedEx built an entire division dedicated to wine fulfillment but how does it stack up to UPS, USPS and DHL? It’s a full-time job keeping up with the differences between carriers, their various rates, requirements, network reach and more. Many CPG brands lack the resources to do this due diligence well and negotiate with various carriers.
Don’t be fooled by the “ships same day” pitch. What matters more than when product leaves is when it arrives at your customer’s door. If your shipping options are slow, you lose every and all advantage to shipping fast. A 3PL like Whitebox can eliminate carrier complexity and provide clear, data-driven recommendations that get your product closer and faster to customers at cost-efficient and competitive rates.
Not every brand that outsources fulfillment comes out on top. But where beverages are concerned, there are a host of strategic advantages to working with an experienced CPG fulfillment partner. Eliminate frustration-filled fulfillment with Whitebox. Our data-driven, tech-powered approach to moving and selling products helps brands succeed in modern commerce. Hear from Super Coffee CEO Jim DeCicco on how Whitebox’s turnkey fulfillment and marketing solution scaled the business nationally, with unrivaled insights into who’s buying, across which channels and where in the U.S. Need help with your CPG beverage fulfillment? Reach out today for a demo!