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Subscription Boxes

November 15th, 2023

eCommerce Order Fulfilment: The Power of Subscription Boxes

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Subscription boxes are nothing new, but with their recent boom, we’ve seen several new customers signing up for this ever-growing phenomenon. According to a report from Royal Mail the value of the subscription box market has grown from 72%, from £583 million in 2017 to £1 billion in 2022 and even more beyond that! Royal Mail says 27% of UK customers have already signed up for a subscription box service, with boxes being most popular with those under 35, while more than half of 25-35-year-olds are signed up to at least one service. Meanwhile, 40% of consumers said they would join more schemes in the future.

When we talk about subscriptions and subscription boxes what are we referring to? There are three types of subscriptions that an eCommerce store can offer:

  1. Curation: The most popular type of subscription box, and the one that we all think about when we say “subscription box.” Curation is where a brand sells a mixture of products which are usually selected at random added to a box and then shipped out to your customers.
  2. Replenishment: This focuses on replenishing goods which your customers regularly use, customers can get a subscription to their favourite haircare products, cosmetics, snacks and so much more.
  3. Access: This type of subscription focuses on access to discounts or services and is more tailored towards B2B or service-based online stores.

With so many more stores creating subscription programs, what are the benefits which come with subscription services?

The Benefits of Introducing Subscription Services.

1. Improved Retention Rates

When it comes to the benefits of subscription services the number one and most important benefit is the promise of retained customers. When your business uses a subscription model, there is an almost guarantee of repeat custom. Subscription models allow customers to sign up to repeat purchases month after month. And with subscriptions which allow you further discounts for those that sign on to 3-12 months you can guarantee a certain monthly revenue without generating any further sales through the website. Having this guarantee of retention allows you to forgo expensive acquisition costs and focus on your loyal customers offering exciting new products each month and even a loyalty discount.

2. Greater lifetime value

When it comes to subscription models and the promise of retained custom, this goes hand in hand with an increase in customer lifetime value. Your customer lifetime value (CLTV) refers to the average revenue that a customer will generate for your business throughout the lifespan of a business. Increasing CLTV will help you to thrive as a company and improve your revenue generated helping you to better plan and organise marketing budgets, product forecasting and so much more.

3. Better inventory forecasting

Encouraging more people to sign up for your subscription boxes will allow you to better plan your inventory management and will influence key decisions when it comes to importing or manufacturing goods. Using a subscription model makes it easier for businesses to forecast what they will need and when. In addition to this using the curation model will also allow you to send out surplus stock to customers meaning that you can manage your inventory better too!  

4. Guaranteed income during off-peak periods

If you’re a business which sees seasonal peaks and troughs, using a subscription model might be the perfect way to guarantee that you get a consistent revenue year-round. Having people subscribe to your products on an annual or rolling basis can mean that during those months which you would traditionally see a dip in sales will now have a guaranteed income.

5. Satisfied customers, every time

The right fulfilment means satisfied customers every time. The final benefit of subscription boxes is honestly a benefit for all eCom businesses provided you get the fulfilment right first time, every time. When it comes to subscription boxes, your customers will be expecting their order on the same date each month. They will be full of anticipation, which will soon turn to disappointment if their order doesn’t arrive. Having a good fulfilment process in place will be the difference between your customers cancelling or maintaining their subscription.

Should you outsource your subscription box fulfilment?

With subscription boxes on the rise, businesses need to give careful consideration to how they plan on fulfilling the orders they receive. Initially, when your business is just starting out, it makes sense for you to fulfil your orders in-house – but with the magic of the subscription model you should soon see incredible growth. So what is the next step?

As your business grows the art of fulfilment will take up a considerable amount of time and effort, and it’s at this point where you should look at outsourcing your logistics. At SCEND we provide an excellent end-to-end fulfilment service which is created on a case-by-case basis to ensure your subscription box fulfilment is bespoke to you and your business. SCEND have the ability to store and pre-kit subscription boxes so that orders go out on-time, every-time.

What are the benefits of using SCEND?

At SCEND we are experts in Subscription box order Fulfilment. We can provide a complete end-to-end fulfilment solution for business. With the proven accuracy and quality of the service SCEND provide, we can help businesses save money and achieve better efficiencies. Keeping operations tight on a subscription box model is crucial as this has the potential to affect your customer lifetime value.

With our cloud-based software, we can integrate with many different marketplaces such as Shopify, eBay, Amazon and so many more. Our Stock management system allows us to operate an efficient fulfilment operation keeping your customers happy. Our systems allow you to keep clear visibility on all of your operations making it easy to manage your logistics from an external location.

Want to know more? Get in touch with the team- hit the button below.

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