In times when online shopping has become an everyday part of life for many, comprehensive order fulfillment service is becoming a key solution that helps businesses effectively manage product logistics. How this service works, the problems it solves, and how it is changing business operations in Lithuania – these are the topics discussed by Mantvydas Kaukėnas, the head of comprehensive order fulfillment services at the international shipping company ‘Venipak’.
Versatile service
Fulfillment is a logistics solution tailored for e-commerce, encompassing the acceptance of goods, storage, picking, packing, and shipping to the final customer. Unlike traditional 3PL (Third-Party Logistics) services, which typically focus on larger B2B (business-to-business) orders, this service is designed for smaller, but frequent B2C (business-to-consumer) orders.
“Comprehensive order fulfillment technological solutions and processes are geared toward e-commerce, so a lot of attention is given to individual orders, efficient warehouse topology, and fast delivery to the end user. Simply put, it’s a service where all logistical solutions are entrusted to the provider,” explains M. Kaukėnas.
According to him, this service helps businesses overcome many challenges of modern e-commerce. First of all, it allows for cost optimization. This means that businesses avoid fixed costs related to warehouse rental or hiring employees. Additionally, it eliminates the need to invest in technological solutions necessary for logistics efficiency and quality.
According to M. Kaukėnas, businesses using the fulfillment service notice not only reduced operational costs but also other benefits.
“This service helps save time, which can be redirected toward business development, ensures smoother processes, allowing for quicker customer service, improves the end-user experience because accurate and timely order fulfillment strengthens customer loyalty. Moreover, it helps avoid improper process organization, which reduces risk and allows businesses to focus on their core operations,” explains the representative of ‘Venipak’.
Fulfillment Development in Lithuania
‘Venipak’ has been providing comprehensive order fulfillment services for 10 years. Initially, as M. Kaukėnas explains, it was an experiment driven by curiosity and the insight that growing online commerce in Western countries would soon become relevant in the Baltic states.
“Since all innovations and novelties arrive a bit later in our country, we realized that, just like in Western countries, the trend of buying online would sooner or later come to us, and along with it, the need for fulfillment services would arise,” he says.
However, the biggest breakthrough for this service occurred during the Covid-19 pandemic, when even traditional businesses were forced to switch to online commerce.
“Although the term is still not widely known today, many businesses are either implementing this service on their own or using it without fully understanding it. During the pandemic, a multitude of new online stores emerged, meeting and still meeting various consumer needs. After the pandemic, many consumers remained loyal to e-commerce, which led businesses to invest in solutions for this sector. This helped fulfillment services become an essential part of business logistics,” says M. Kaukėnas, noting that interest in specialized solutions for specific sales channels continues to grow.
When asked how the comprehensive order fulfillment service in Lithuania compares to other countries, the specialist notes that, compared to Western countries, Lithuania has a few distinctive features.
“In the West, processes are often more standardized, and customers have less flexibility in choosing partners or delivery methods. However, in a smaller market like Lithuania, flexibility is essential because businesses often have to combine B2B and B2C orders. Among the Baltic states, I would highlight Estonia, where fulfillment infrastructure is much more developed, and Latvia, where this service is becoming more popular but has not yet reached a high level,” he explains.
Tips for Those Considering Fulfillment
For those considering comprehensive order fulfillment services, M. Kaukėnas first recommends assessing their needs and analyzing the potential benefits and challenges.
“My advice would be not to have a preconceived opinion and to assess the potential benefits. You should evaluate not only how much you will save but also what you will be able to do for your business when you no longer need to worry about operational activities. It’s also important to understand that this service is not for everyone, so if, for example, you have particularly complex processes that are unique to your business, this option may not necessarily be the best for you,” he says.
Is the size of the business important for such a service? In M. Kaukėnas’ opinion, it is certainly not a crucial factor.
“We have various clients whose annual turnover ranges from 10 thousand to 10 million euros, so the size of the business is not an indication to follow when making a decision. Smaller, growing businesses always face the dilemma of whether to invest or outsource their operations, but if nothing is done, costs catch up with revenue, and as volumes grow, efficiency decreases. Medium and large businesses operate a bit differently: through the lens of cost-saving, administrative reduction, and growth opportunities, so decisions are usually driven by the numbers,” explains the interviewee.
Once the decision to use fulfillment services is made, according to the ‘Venipak’ specialist, the most important thing is to choose the right partner – visit their logistics center, evaluate the processes, clearly define your expectations, and provide as much information as possible about your operations. This will not only help you get a better offer but also prevent misunderstandings. It is also essential to allocate enough time for IT system integration and testing, as thorough preparation is crucial for smooth cooperation.
M. Kaukėnas adds that with the growing diversity of e-commerce channels and consumer expectations, comprehensive order fulfillment services in Lithuania will continue to grow in popularity.
“This is not just a modern solution, but also a strategic step that allows businesses to compete more effectively in the global market. The key is not to be afraid of change and to boldly embrace new opportunities,” he is confident.