A Third-Party Logistics Provider, commonly referred to as a 3PL, is a company that offers logistics and supply chain management services to businesses. The services include order fulfillment, warehousing, inventory management, and shipping.
By outsourcing to a specialized logistics provider, companies can focus on core business activities while ensuring efficient and timely delivery to customers.
A 3PL integrates with operations to manage key logistics functions. When a customer places an order, the order details are automatically forwarded to the 3PL. The 3PL receives the order, picks the products from the inventory, packs them, and ships them to the customer’s location.
3PLs utilize various integration methods. Many 3PL companies offer native integrations with various e-commerce platforms, allowing synchronization of order and inventory data. This integration ensures that whenever an order is placed on the Shopify store, the 3PL receives the information automatically.
A good 3PL has:
- Reliable and efficient order fulfillment
- Seamless integration
- Wide network of warehouses
- Technology and automation
- Transparent pricing and flexibility
- High-value customer service
When partnering with a 3PL, several factors impact the bill:
- Order Volume: The number of orders you process affects the cost, as higher order volumes require more labor and resources for picking, packing, and shipping.
- Storage Space: The amount of inventory you need to store in the 3PL’s warehouse impacts the cost. Larger storage requirements will incur higher fees.
- Value-Added Services: If you require additional services such as kitting, customized packaging, or returns processing, these value-added services may incur extra charges.
- Shipping Distance and Weight: Shipping costs are influenced by the distance between the 3PL’s warehouse and the end destination, as well as the weight and dimensions of the packages. Longer distances and heavier packages may result in higher shipping rates.
- Shipping Speed and Service Level: Expedited shipping options or premium service levels offered by the 3PL will come at an additional cost compared to standard shipping methods.
- Special Requirements: If your products require specific handling, such as temperature-controlled storage or hazardous materials handling, additional fees may apply.
Teaming up with a trustworthy 3PL can unlock a lot of benefits. By entrusting your fulfillment operations to a specialized provider, you save time and money and get more time to focus on products and customers.
Contact us for advice and support with evaluating and implementing a 3PL. Our team has years of experience making it happen.