Percentage of Companies Looking for Large Scale Fulfillment Only a Small Slice of the Pie

Oftentimes, as a lead generation company within the warehousing and fulfillment niche, we get asked by potential warehousing vendors or current customers just how many “large scale” opportunities we see on a regular basis. And because we’ve received even more of these requests than usual lately, we decided to analyze our last couple of years of data to determine just how many leads we produce that would classify as larger volume, versus the smaller and mid-sized deals. The results definitely provided some insights into the overall online marketing segment for warehousing and fulfillment services.

Methodology Behind the Statistics

In our system, we classify warehousing and fulfillment leads based upon the number of orders processed per month, which we felt would be a fairly good measure for this particular study. In our system, lead volumes are classified into the following monthly volume levels: Less than 200 orders per month, between 200-499 orders per month, 500-999 orders per month, and 1,000+ orders per month. The number of orders per month are taken directly from the prospect. In most cases, they are very accurate. It is important to note that in other cases, the figures provided by prospects can vary from actual figures. For example, newer companies may anticipate larger volumes than may actually be achieved. Similarly, some companies have been known to underestimate order demand, and actual volumes are higher than anticipated. For purposes of this study, we took prospects at their word, and used their “form filled” order volumes as the measure for size of the deal. One final note on the study – all of the leads evaluated in this study were derived via online marketing.

Let’s Get to the Results

After reviewing the last few years-worth of data, we found that 90.38% of all leads generated had monthly order volume levels of less than 500 orders per month – in other words, companies looking for small business fulfillment servcies. On the flip side of the coin, a slim 9.62% of all leads generated had monthly order volume levels in excess of 500 orders per month. Results of the study are reflected in the below pie chart.

Study

So What Does All of this Mean?

As a producer of online leads for various Business to Business segments, insightMedia, Inc. has a very unique vantage point. The results seem to indicate that most leads are smaller volume opportunities – and these results were also highly correlated with the results for other B2B niches. In other words, in areas from warehousing and fulfillment to call center and search engine optimization, most online leads that we’ve generated fall into the small and mid-sized business segment. But why, you might ask? We believe (not so scientifically) that the proportion of smaller deals is due to the larger percentage of small businesses within the US. According to U.S. Census data, 99.7% of all U.S. Employer Firms are small business (less than 500 employees). The numbers pretty much speak for themselves.

How Can Fulfillment Companies Use this Information?

A study doesn’t provide much value unless there are some insights that one can draw from it. In this case, we think that there are a couple of very valuable ways to interpret the data and incorporate the findings into your fulfillment business. First, if you’re one of the fulfillment firms that is only looking for large scale opportunities, you’ll have to find some very creative ways to generate these types of leads – as the opportunities are very few and far between. Second, if you are the type of fulfillment organization that targets these types of opportunities, the potential for growth is significant. Further refining your internal strategy to effective fold these types of organizations into your warehouse will have a great appeal to the prospect, and will also diversify your risk pool. It’s no wonder that companies like Amazon and Shipwire have created solutions to appeal to these types of companies. As for our company, we definitely embrace the small business market segment, and are proud members of the segment ourselves. But hopefully armed with a little data, you too can put some thought into your strategy to solidify your niche and target customer type, as well as create a thoughtful strategy to best position yourself for success against the competition.

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