There’s many reasons why companies consider using 3PLs in their day-to-day logistic operations. Though every business functions differently, one common question for business owners is: Is using 3PL right for me? So let’s take a closer look at what 3PL does and what you need to know before making your final decision.
WHAT DOES A 3PL DO?
A 3PL fulfillment company is a third party logistic partner. They fulfill your orders, manage inventory, shipments, warehousing, distribution and more. Essentially, a 3PL company fulfills every and all things related to inventory.
Most popular fulfillment companies out there offer store integrations which allows 3PL customers to add eBay, Amazon, Walmart, etc directly into their order fulfillment dashboard. This way, every order will automatically push to the 3PL company which would then pick, pack and ship out your order by your selected cut-off time.
If you are an up and coming business, it is more likely that your costs will be significantly higher doing it in-house vs outsourcing to a 3PL order fulfillment company.
WHAT TO KNOW ABOUT 3PLs
Order fulfillment companies have the knowledge and expertise to streamline any online business fulfillment needs. Most 3PL services have special discounted negotiated rates with large carriers like FedEx, UPS, and USPS that can give your margin a boost by saving a ton on shipping.
A great feature about 3PL fulfillment companies is that you only pay for what you use, in terms of your inventory storage. This really helps with costs when starting a business or even scaling a larger sized business. So you can essentially skip the headache of leasing a warehouse and bearing the large costs that come along with it such as paying a first month, last month, and security deposit, property insurance (in order to obtain keys), warehousing software, and a standard retail shipping carrier account.
In an instance where you are sold out of inventory and have empty space you’d still be paying the same fixed amount for rent whereas with a 3PL order fulfillment company, you optimize your costs by only paying for what you use.
RETURN ORDER PROCESSING
Most reputable 3PL fulfillment companies offer return order processing. This is a great service to benefit from as an online business owner because you know your returns are being managed professionally and on-time everytime. Often times, 3PL companies offer inspection services to make sure return reasons are accurate and will actually add your return back to your inventory if it qualifies.
3PL companies are very beneficial for online businesses of any size. It’s a good feeling knowing your receiving, sorting, management, picking, packing, and shipping are all taken care of so you can focus on the thing that’s most important, managing and growing your business.
When signing up with a 3PL fulfillment company, you are given an online dashboard where you can do tons of things like manage your inventory, create purchase orders, automatically integrate your stores, manage reports, and much more.
Many of us business owners thrive to cut costs tied to running an online business, speaking with a 3PL company might be the best solution for your business that can make instant impact to your sales and margins. It’s always best to shop around and weigh your options, but in the end, you want a professional and experienced 3PL company to rest at ease while having your entire business at your fingertips.