Many challenges are involved in growing your e-commerce business, but one of the biggest challenges is outgrowing your current fulfillment operations.
Partnering with a 3PL is a serious business decision. To help make that decision, PartnerTrade will define in this article how 3PL can help develop your e-commerce business.
What is third-party logistics?
A third-party logistics company (3PL) handles almost every aspect of your e-business fulfillment processes. They get your products from your manufacturer, store them, and when someone places an order on your e-shop, the 3PL will package and ship the order directly to your customer.
By outsourcing delivery functions, you can avoid investment loss. Instead, it allows you to focus on other areas of e-commerce, such as marketing, customer service, and adding products to your catalog.
What does 3PL do?
Third-party logistics companies deal with almost all areas of logistics and fulfillment. Some of the more common services include:
- Delivery of goods to and from your customers;
- FCL / LCL shipping;
- Warehousing and storage;
- Manage inventory;
- Packaging of orders;
- Individual packaging;
- Returns processing.
Different 3PLs may offer additional services. For example, to store and package temperature-sensitive items.
How do 3PLs work?
3PLs work as intermediaries between your business and the customer. They are an essential part of your business’s supply chain, and the whole process is like this:
- Your company places an order at a manufacturing plant.
- These finished products are sent directly to a 3PL warehouse or fulfillment center.
- This inventory has been received and registered.
- It is then stored and organized by the 3PL staff.
- Then, when a customer places an order on your e-shop, that information is sent directly to the 3PL team.
- The orders are then assembled and packed.
- The 3PL will then transfer the packages to the carrier the customer chose.
- The carrier will deliver the parcel to your customer’s door.
Indicators you should work with 3PL
- Shipping costs are becoming too much for you and your customers.
This is where a 3PL can help minimize costs as you scale your e-commerce business and adapt to different periods of growth.
- Delays in order fulfillment are becoming the norm.
No matter what shipping your customers choose at checkout; they’ll want your products delivered quickly. This can only happen if the order is packed and delivered to the carriers on the same day the order is placed.
- You are entering a new market.
Business expansion into a new part of the country or planning to start sales in a new country can cause logistical problems. By partnering with a 3PL, they can ship some of your inventory to a fulfillment center closer to your customer. Some 3PLs will have fulfillment centers worldwide so that you can reach a global audience faster.
- You need more storage space.
Warehouses are designed for more extended storage and delivery of goods in bulk. If your orders arrive on time, keeping your inventory in stock may add an unnecessary step to your supply chain. With a 3PL, you can store more products and prepare them for delivery faster.
- You want to expand your e-commerce business.
Scaling an e-commerce business can take time and effort. The increase in sales puts a strain on your existing logistics. 3PL companies allow you to continue to provide a positive post-purchase experience for an ever-growing number of customers.
Choosing a third-party logistics company can be crucial in developing your business.
PartnerTrade is an experienced 3PL company that offers global logistics and fulfillment services for businesses of all sizes. We work with different carriers and have a network of agents located worldwide. We understand the complexities of global logistics and are committed to providing you with the best service possible.