This article is sponsored by Fulfillrite: Kickstarter and crowdfunding reward order fulfillment services. USA & International shipping services.www.fulfillrite.com
If you are planning a crowdfunding campaign or have recently finished fundraising through Kickstarter or Indiegogo, I’m sure you’ve come to realize the major financial and time cost of reward or “perk” fulfillment.
When you tally up shipping and handing, trips to the post office, stamps, bubble wrap, and time spent stuffing envelopes and getting together packages, fulfilling your backer’s rewards can seem like a part-time job. Remember, these are the people who believed in your project and pledged their hard-earned money to see its completion. Expedience is of utmost importance.
Many campaign creators struggle with the question as to when it’s appropriate to outsource fulfillment and when they should just stick it out and obtain the help of friends and family. I’ve highlighted a few decision points below that can help guide you when making this decision. Keep in mind, that no two crowdfunding campaigns are unique, but these are great general elements to consider when deciding whether to outsource your reward fulfillment or keep it in-house.
Time Commitment & Stress Factor
Now is the time to evaluate how much you can commit each day to reward fulfillment. It’s also important to develop a timeline explaining how many perks you can fulfill each day and how many days it will take to fulfill all of the orders you expect to or have obtained from your crowdfunding campaign.
If you’re working a 9-7 job with commuting, and are also committed to home cooked meals, exercise, and being able to relax in front of the television, it may not be realistic for you to meet your fulfillment goal in a reasonable timeframe. Obviously, weekends are a great way to catch up on work related to your Kickstarter or Indiegogo campaign, but after a long anxiety-ridden week, the last thing most people want to do is take on more work on the weekend.
If you are extremely driven, have a written plan, and know you can deliver in a reasonable timeframe, awesome! This should be a pain, but you are able to endure it. However, if you have doubts, have major work-related travel plans, or don’t like the idea of committing your weekends to fulfillment, then it might make sense to pass on the stress to another group of individuals. It’s true, you will have to sacrifice some of your margins, but think of it as buying peace of mind and buying free time. In addition, the order fulfillment company will likely have experience with international shipping and customs, factors that most people need to spend time researching.
Margins
Before even considering the possibility of outsourcing fulfillment, it’s important to ask: Can you afford it? If your margins are already razor-thin, you may not have much of a choice. Any added costs will bring you into the red. You might not like it, but this is the time to solicit help from friends, family, and neighbors.
Once you’ve made sure that every backer receives exactly what they pledged for, go back and be sure to look through your financials and do a cost analysis. Are the low margins a result of the crowdfunding medium, or is there a larger element in the equation, where you can cut costs or get a better supplier rate for improved margins? At some point in time, if you intend to sell the product independently, fulfillment services will likely be necessary and at that time, it will pay off to have better margins so that you can afford it.
Rapport With Customers
Do you care about your relationship with your backers and customers? Every interaction that customers have with your business gives some indication about your credibility, your company’s values, and how you’d like your company to be perceived by the public. .
Apple uses its packaging as a marketing tool to communicate their values regarding excellent design and a tendency for perfectionism. If you are not planning to sell your product after raising money on a crowdfunding platform, then you may not need to worry as much about the professionalism of the pacakging and labeling. However, if you are intending to use the crowdfunding platform as a springboard into starting a company, then professional packaging and labeling services are a must!
Establishing Business Relationships
As I mentioned above, if you are doing a one-time project and don’t intend to sell your product after having raised money on a Kickstarter or Indiegogo, then you may not need to worry as much about your relationship with service providers and fulfilling more product orders.
However, if you are intending to go into buisness after the completion of the project and to continue to sell the product, then establishing a realtionship with an order fulfillment center early on can help you negotiate better rates, anticipate costs, understand fulfillment-related problems, and to give the company a test-run with a small batch of orders.
Lastly, solving the problem of order fulfillment is the first step in building the infrastructure and systems that will help automatize your business in the future. If you are using Kickstarter or Indiegogo as a launch pad into starting your own company, I’d recommend getting acquainted early on with order fulfillment companies, as this is a crucial element of your business.
