As an e-commerce retailer, applying your processes and supply chain strategy can be a challenge, but there are plenty of third party logistics providers (3PLs) that can make life much easier.
But with so many out there, how can you find the right 3PL for your e-commerce company?
Some offer logistics, some offer warehousing and storage, some offer international shipping and others offer fulfillment. Before deciding, you must identify your businesses’ needs in terms of fulfillment, logistics and warehousing. Once you have a supply chain strategy laid out, it will be much easier to determine which ones fit for your company.
Inventory and Warehouse Storage
Many 3PLs are buying up warehouses across countries because of the rapid growth in e-commerce business. While you could be running your online store from the comfort of your own home, the products you offer have to be somewhere before your customers buy them. Depending on your sales volume, you may need thousands of square feet of storage. The best 3PLs assess your storage needs and provide cost-effective solutions.
A tech-based 3PL offers software that seamlessly integrates with all major e-commerce platforms and marketplaces. This enables merchants to connect their stores in just a few clicks without requiring a developer to set up an integration. Connecting multiple data sources provides a cohesive view of orders, inventory, fulfillment centers, sales channels and customers—all in one place.
What Kind of Shipping Services are Available?
The type of shipping services you need for your e-commerce business may depend on the product you’re selling and how far along you are in establishing your customer base. For companies just getting started, shipping needs might be limited to a few small parcels, where a larger online retailer may be able to fill an entire semi-truck. With smaller shipments, many e-commerce retailers send many small shipments to the same destination. 3PLs can consolidate all of those shipments into one to provide a cheaper shipping cost.
3PLs can also help expand your company’s outreach across the globe when they have global shipping options available. By expanding their reach worldwide, 3PL providers have enabled expansions into markets where it would previously have been cost prohibitive to do so.
Is Fulfillment a Requirement for Your E-commerce Business?
E-commerce platforms like Amazon offer order fulfillment services, which can free up time that can be put back into growing the business. But it comes at an extra cost. If you’ve decided to carve your own path in the e-commerce world without the help of an established platform, 3PLs can help with fulfillment if it becomes too much of a hindrance to your business. Full-service 3PLs allow organizations to offer a higher level of customer service at a lower cost, while freeing up time and resources to focus on other fundamentals of their businesses.
Keeping Up with Technology
As an online retailer, the first thing prospective customers are going to see is your website. Like the assortment of website themes and plugin options you had when you launched your store, technology-based 3PLs offer plenty of options for tech support. These include software systems for tracking inventory, shipments and financials to alleviate logistical headaches.
According to Inbound Logistics, technology provides enterprise-wide visibility and the ability to pull from multiple fulfillment sources. It also offers real-time information about product availability, order status and shipment tracking. Implementing technology solutions with internal resources requires expertise, financial investment and ability to scale. Outsourcing to a 3PL will bypass these requirements.
Many 3PLs offer a variety of services that allow e-commerce companies to utilize them as much or as little as they’d like. Once you find the right 3PL for your e-commerce company, you can outsource certain processes to reduce costs and make life easier for your company’s supply chain.