Learn how this cleaning products company successfully implemented e-commerce fulfillment with TAGG Logistics
Today we’re sharing an e-commerce fulfillment success story about how a major cleaning company expanded from shipping pallets to big box retailers to a total e-commerce fulfillment model shipping parcels to consumers, with TAGG Logistics as their 3PL fulfillment partner.
From cleaning commercial coffee makers to removing crayon from a child’s bedroom wall, this CPG manufacturer’s cleaning products are household names in businesses and homes across America. For decades, people have lined up at big-box retailers such as Walmart to buy them. But as more and more consumers trade their brick-and-mortar shopping cart for a virtual one, the manufacturer wanted to expand into the lucrative e-commerce market, enabled by an e-commerce fulfillment model. But there was a problem: how could it sell online profitably?
The first challenge was that the price point of an individual product was too low to sell in ecommerce channels. By the time the manufacturer paid for e-commerce fulfillment and shipping, there would be no margin left. The second challenge is that many of the products were liquid and/or considered hazardous by regulators. That made their safe handling complex, but essential to comply with federal, state and local regulations.
How could the manufacturer overcome these two hurdles and profitably stock its products on the “endless aisle” of the Internet?
E-commerce fulfillment gets even better with smart, specialized packaging
The manufacturer wanted to profitably sell online via several channels—including Amazon.com as the primary channel—plus its own branded website and others. To make it happen, the manufacturer needed to make its products “e-commerce friendly” for shipping direct to consumers successfully. This included managing the special packaging requirements of Amazon for all orders, as well as complying with applicable regulations for handling and shipping those products that are considered hazardous.
- Bundling: When fulfilling and shipping a single item isn’t cost effective, bundling it with the same or related products can be. This approach increases the average selling price and can turn an otherwise unprofitable purchase to profitability for the manufacturer.
- Stable packaging for shipping: The manufacturer sells specialty cleaning products that are bulky, heavy and fragile. Many are liquids, which are among the most challenging products to ship. Amazon shipping requirements for making these products leakproof are very stringent, and the manufacturer must meet them to have access to this lucrative customer base.
To improve stability while in transit and help avoid damage or leaking, TAGG shrink wraps individual products together into a bundle. TAGG has multiple automated packaging lines that convert cases of products delivered by the manufacturer to parcel-sized shipments to consumers.
TAGG unboxes the products, bundles two together, shrink wraps them and puts them back in the box—ready for picking and packing consumer orders as they arrive. TAGG also performs “drop tests” and “corner crush tests” to further ensure the products will ship safely. Delivering products that are undamaged and ready to use further supports the manufacturer’s quality brand experience.
Handling hazardous materials in an e-commerce fulfilment model with confidence
Some of the manufacturer’s brands are “limited quantity” products considered hazardous by regulators. These cleaning products pose unique and complex challenges for safe storage, handling, packaging and distributing.
To meet e-commerce customer demand for one- or two-day delivery, orders often must ship by air and be subject to strict IATA (International Air Transport Association) regulations. These products require additional, special labeling and expertly trained staff to handle.
That’s why the manufacturer needed a fulfillment partner well experienced in complying with all federal, state and local regulations. In addition, the 3PL company needed specialized hazmat storage and logistics employees trained in handling hazardous materials.
TAGG is well versed in these regulations and has the in-house expertise to help the manufacturer remain compliant as it continues to expand its e-commerce fulfillment operations. In particular, TAGG can serve as the “compliance expert” for Amazon shipping, so the manufacturer can profitably and safely offer limited quantity products to Amazon customers.
Cleaning up online
Collaborating with TAGG, the manufacturer has successfully expanded its sales from the traditional B2B channel (to brick-and-mortar retailers) to a highly effective ecommerce fulfillment solution. Sales are growing—as is customer satisfaction. Now, consumers don’t need to drive to the store to pick up their favorite cleaning products. They’re delivered right to their front door.