The continuous rise of e-commerce has challenged online sellers to keep up with the demands of consumers. As demand grows, inventory management is the key to success and great customer experience so you must make the whole process efficient. Businesses of all sizes have been using 3pl warehousing services nowadays to streamline their supply chain process and maximize the results.
A third-party logistics (3pl) company is a service provider outsourced by many businesses to handle their inventory. Not all businesses have the capacity or capability to store their products and oversee the distribution of their orders. A 3pl is a great solution for this as it is already a one-stop shop for all your logistics needs. One of the most essential services a 3pl offers is warehousing which is a must for product storage and simplify the distribution process. Services included in 3pl warehousing are order receiving, packaging, order fulfillment, and returns processing. All of these contribute to a seamless supply chain process and improve overall customer experience.
Why Should You Use a 3pl?
There are many reasons why getting a 3pl partner is a great benefit for your business. Some may be hesitant to acquire their services because it may seem like additional costs, however, it is actually the opposite. A 3pl saves you more money unlike if you are handling inventory on your own. Supply chain management is vital to your business’s success and if you can’t handle it properly, then it will negatively affect your whole business processes. With a 3pl, your logistics needs are already in one place, cutting overhead costs. You will not have to hire separate services for warehousing and inventory management as your 3pl partner will be the one handling everything from start to finish.
Another advantage of using a 3pl is that you will be working with an experienced team. They are very knowledgeable when it comes to the ins and outs of the distribution process. They handle the necessary paperwork for your products to arrive at their destination without any trouble. If the 3pl staff encounters any problems at any part throughout the process, they can easily remedy it to ensure that the supply chain will not get disrupted.
Overall, a 3pl creates a more efficient supply chain management fit for your business needs. It makes warehousing and distribution fast and accurate to achieve your goals and keep your customers satisfied with your performance. When you have an efficient system, it allows you to keep up with the competition while also maintaining good credibility among consumers. A 3pl partner can also keep costs at bay, saving you from unnecessary costs.
What Are Some Tips for Finding a 3pl?
Achieving an efficient, fast, and cost-effective order fulfillment process is possible through the services of a 3pl company. However, you have to make sure that you are picking a reliable partner to maximize your supply chain process and get the desired results you want. It is not going to be easy finding out the best 3pl for your business since you can find many service providers on Google. To help you find a trustworthy 3pl partner, we are providing some tips to guide you:
- Assess your business needs and goals
Before you start looking for 3pl companies, you will have to assess your own business needs and goals first. These will serve as the basis for picking a 3pl partner. It is easier to select a 3pl if you can identify which aspect of your supply chain process needs to be improved or you want to focus on. Are you having trouble managing inventory? Constantly delayed shipments? Looking to scale operations soon?
Having a clear reason why you need a 3pl can narrow your search down and it is easier to shortlist companies that fit your needs. Do not forget to take the budget into account as this will also help in filtering out potential partners.
- Research different 3pl companies
Once you have determined your business needs, you can now start your search for 3pl companies. If your e-commerce shop is in a particular niche, there are service providers that specialize in that area. This way, it is easier to shortlist potential partners and make your choice.
The most accessible way to research 3pls is by searching on Google. Most likely their websites are listed on it and you just have to do a thorough assessment. You may also filter your search according to type since there are 3pl companies that are specifically for large businesses with high-volume orders and those that are not. If you are a small e-commerce business, you should look for 3pl companies that offer flexible services.
- Evaluate their services
3pl companies offer basic services such as warehousing, inventory management, and freight services. Usually, each company has its own specialization so you have to verify if your products can be handled by them. Depending on the nature of your business, your products might need special handling or be kept in a controlled environment. Validate with the 3pl if their infrastructure and services can accommodate your products.
Also, check whether the 3pl is offering other value-adding services such as packaging, customization, returns processing, and quality control. These will add to the customer experience and improve the efficiency of your supply chain process even more.
- Find out what technology they use
3pl companies use technology to automate the logistics process. Find out if they are utilizing the latest technology to create seamless management and distribution. Good 3pl companies will also have integration software that allows them to connect with your e-commerce shop for easy order fulfillment. Whenever you receive an order, your 3pl partner will automatically be informed and they can start preparing it for shipment.
Having the latest cutting-edge technology makes supply chain management more efficient and simplifies order fulfillment. As demand grows in e-commerce, you must keep up and deliver great results to your consumers. To ensure that you have a smooth and seamless end-to-end supply chain, integration between your e-commerce store and your 3pl partner will be needed.
- Determine their flexibility and scalability
If you are looking to expand your business in a different market in the future, your 3pl partner should have the capability and capacity to do it with you. They should be able to take more inventory and can help you reach new markets. It is great to plan long-term to avoid making last-minute decisions that your 3pl partner may not be happy with.
At the very least, they should be able to handle order surges, especially during peak seasons. They can scale up if there is a high volume of orders and scale back down when demand goes back to normal. Flexibility is a great quality for a 3pl to have because it also displays their skill to adapt to any changes smoothly.
- Ask for references and certifications
Always ask for references and certifications from the 3pl companies you are interviewing as these will serve as your bases for verifying their credibility. If possible, ask them for the contact details of a previous client so you can ask them about the company’s performance and if they have lived up to their expectations.
Do not forget to check the legality of their business operations. You want to have a 3pl partner that has complete certifications as these show they are compliant with existing laws and regulations.
Finding a good 3pl will improve your supply chain process and your business as a whole. If you choose the right fit for your needs, it will maximize efficiency and yield great results. It can be an overwhelming process but knowing what to look for in a 3pl is helpful in your selection. During your selection process, always communicate your needs clearly so you can determine if they are a perfect fit with the way they answer. Your business’s success lies in how you and your 3pl will work well so you have to ensure that you are making the right choice.