WHAT IS 3PL: Services, Examples & Companies

It’s not always the most productive for a business to handle most or all activities internally. This is especially true for tiny eCommerce companies. By operating on a tight budget, several eCommerce businesses have been able to grow their businesses. You can collaborate with experts on one of the most crucial facets of your eCommerce business by using 3PL services. It enables you to concentrate on marketing, business expansion, and client happiness. Why not check out this article to read more about 3PL examples, services, warehouse,s and companies?

What Is 3PL?

The terms fulfillment center and fulfillment warehouse are interchangeable when referring to third-party logistics, or 3PL. Several of the services offered by 3PL providers are also provided by order fulfillment businesses.

Online store fulfillment is handled by a 3PL provider. It offers every service you require to contract out your logistical operations.

Fulfillment and warehouse services are areas of specialization for several 3PL service providers. Some people can handle chilly fulfillment. Food products that require refrigeration or freezing can be stored and shipped in these warehouses. Hazardous materials can be shipped and stored by other 3PL providers. One of the best third-party logistics companies for large, heavy, and expensive goods is Red Stag Fulfillment.

How 3PL Operates

An illustration of a 3PL configuration in action is given below: The production of publications by a book publisher involves the hiring of writers, editors, and graphic designers; yet, the publisher may not want to be responsible for consumer ordering or shipping. The book publisher, on the other hand, uses a fulfillment center to handle online orders and a trucking company to transport its freight. Both the carrier and the fulfillment center serve as 3PL providers. Order fulfillment and shipping for books can also be handled by a single 3PL supplier.

The book company can more effectively control expenses by working with a 3PL provider to employ supply and distribution services just as needed, allowing it to concentrate on what it does best: publishing books.

The Advantages of 3PL

Using a 3PL service to manage logistics, such as packaging, warehousing, fulfillment, and distribution results in cost savings, such as not needing to operate a warehouse or hire people to oversee supply chain activities.

One of the benefits of using a third-party logistics provider is the increased efficiency with which tasks like shipping may be scaled

#1. Scalability

Depending on the precise services needed, a 3PL supplier can scale a company’s space, manpower, and transportation needs. Manufacturers, suppliers, and other manufacturers can expand in new markets more successfully and uniquely with a lot less difficulty. The purpose of a 3PL is to streamline the logistical processes—areas in which you may lack expertise—and open the door to greater business expansion.

#2. Time and Financial Savings

Businesses are aware that success depends on a certain degree of efficiency, and here is where a 3PL may have a significant impact. By outsourcing to a 3PL, you can save money and time that would otherwise go toward things like constructing and maintaining a warehouse, arranging for the shipping of goods and/or services, optimizing those services, and keeping up with emerging technology, all of which are essential to the growth of your firm.

#3. Development

With 3PL services, expanding a company into new markets and geographical locations, such as emerging nations, is now easier than ever. Working with a 3PL allows a company to take advantage of new supply chains, enhance customer service, and tap into untapped markets. Such expansion is now more feasible than ever thanks to the availability of distribution centers and warehouses from third-party logistics companies, who frequently incorporate the required security and compliance measures into their service offerings and have attained the necessary certification to deliver worldwide services.

When Must You Take into Account a 3PL?

There are many factors that can influence whether a business chooses to work with a 3PL provider.

Although there isn’t a secret formula to determine when it’s appropriate to hire a 3PL, there are several repeating characteristics that can aid in outsourcing decisions.

The expenditures of increasing labor, production, buildings, and personnel can quickly spiral out of control if a business is expanding more quickly than anticipated (which is actually a terrific problem to have).

Without compromising your valuable internal resources, a third-party logistics provider could reduce some of these expanding headaches. You may avoid a lot of logistical hassles by working with a 3PL, not to mention time and money.

Using the most recent and cutting-edge technology is another benefit for 3PLs. A business can obtain these technological advantages by using a 3PL without having to make the necessary financial commitment.

A major selling point for a third-party logistics provider can be those 3PLs with in-house IT teams who create and deliver their own B2B interface, WMS, TMS, and inventory management software.

After facing ongoing inventory inaccuracies, inefficiencies, and other serious errors, many businesses decide to partner with a 3PL. A company’s reputation can be destroyed by inconsistent inventory capacity and erratic expenses, but a 3PL with dependable inventory solutions can help by simplifying the flow of items for less resource use and faster delivery.

3PL Services

Wondering what 3PL services are all about? Here it is:

#1. Delivery and Shipping

The management of the entire shipping process is the main focus of 3PL companies. These businesses frequently offer technology, usually in the form of integrated freight management services or a transportation management system (TMS). These technologies were created to increase productivity and automate repetitive but time-consuming operations like accounting and freight payment. For greater real-time visibility and transparency throughout the shipping process, these 3PL suppliers also include matrix reports, freight data management, and carrier relations management.

#2. Transportation

The actual movement of products or services between locations is the responsibility of 3PL transportation providers. The management of an inventory shipment between a business and the customer by a 3PL provider is a typical instance. In order to perform the tasks for their partner, many 3PL providers of transportation frequently use other transportation companies.

#3. Keeping Stock

One of the most typical categories of third-party logistics providers is warehousing 3PLs. An integrated warehouse 3PL that specializes in the storage and distribution of goods and/or services is part of a company’s warehousing and transportation processes. The handling of storage, distribution, and product transportation can often be customized by 3PL warehouse providers.

#4. Dispersion

Outbound order fulfillment, picking and packaging, custom labeling, and manufacturing are just some of the distribution and wholesale services offered by many 3PL companies. A small corporation may find it difficult to oversee the effective distribution of big product volumes; by outsourcing distribution to a third-party logistics provider, its workers can concentrate on other business duties that fall within their areas of expertise.

3PL Companies

Fortunately, there is a wide variety of 3PL companies to pick from, each with its own set of capabilities and areas of expertise. Choosing a third-party logistics services provider that is smaller and more centrally located in a certain region may make sense depending on the size of your organization. Here are a few 3PL companies you need to be familiar with:

FedEx Supply Chain
Hub Group
B. Hunt
Kuehne + Nagel (The Americas)
Burris Logistics
H. Robinson
DB Schenker
DHL Supply Chain North America
Expeditors
Penske Logistics
Ryder Supply Chain Solutions
Schneider
ShipBob
UPS Supply Chain Solutions
Whitebox
XPO Logistics

What Is 3PL Warehouse?

The supply chain and logistics activities of a firm can be outsourced to a third-party logistics warehouse, sometimes known as a 3PL for short. Third-party logistics providers (3PLs) are hired by businesses to handle the storage and shipping of their client’s goods.

Third-party logistics providers (3PLs) oversee the storage, distribution, and shipment of goods for various clients. It is considered a hybrid 3PL if the company stores and processes orders for both its own needs and those of its clients.

Several third-party logistics providers (or 3PLs) focus on serving a certain industry or market segment.

B2B
E-commerce
Retail
Apparel
Raw Materials
Bulk Goods
Nutraceuticals
Wines & Spirits

3PL Examples

A third-party logistics services provider is a service or partner that aids online retailers in controlling their supply chain. Warehouse and inventory management, order fulfillment, shipping coordination, retail distribution, swaps, and returns are typical examples of 3PL services.

Tips To Help You Find The Best 3PL Services Company For Your ECommerce Business

Finding the best fit is the next step after deciding to engage with a third-party logistics provider. Easy integration with the eCommerce platforms where you sell will indicate which 3PL firm is appropriate for your organization. Your chosen fulfillment company should have knowledge of shipping goods that are comparable to those you offer. Every fulfillment business is unique. Even a top-notch 3PL might not be the best option for your company.

Here are a few more things to think about while choosing the best provider of eCommerce fulfillment services.

#1. Expertise in 3PL Services

The most successful fulfillment companies are aware of their unique advantages and disadvantages.

Experience is crucial. Fulfillment facilities are designed to effectively handle common shipments. A warehouse that focuses on selling lighter things might include a large assortment of shipping bags and a pick-and-pack system that is intended to rapidly put together small products into customer orders.

You won’t obtain the level of service you require if your products are outliers in the warehouse. In fact, because of poor packaging, you can receive damaged goods. Make sure the order fulfillment company you choose can handle your merchandise.

#2. Locations of 3PL Warehouse

Send your goods from your own warehouse may provide you with a sense of control. But, unless your clientele is concentrically located near your place of business, this likely puts you at a disadvantage when it comes to shipping. A better option could be to have a few fulfillment warehouses in strategic areas. This places your goods in close proximity to all of your clients for nationwide fulfillment.

#3. 3PL Services Customer Service

You must immediately locate and address any issues that arise with your business. Your eCommerce business depends on dependable and prompt customer service. Ascertain the level of support that your order fulfillment partner provides. Are there specific customer service representatives for each customer at the company? How quickly does customer service respond? How soon can issues be resolved

#4. 3PL Services with a Specialization

Your third-party logistics services provider can improve the value of your firm. With kitting services, you may produce kits with added value and boost sales. You may provide your clients with more alternatives thanks to just-in-time customization. Find out whether your eCommerce fulfillment center can offer these or any other unique services that can aid in the expansion of your firm.

What Are the Four Types of 3PL?

Here are the 4 types are:

Standard 3PL Providers
Service Developers
Customer Adapters
Customer Developers

What Is the Main Role of 3PL?

To promote business growth, market expansion, and innovation, it enables organizations to concentrate on their core capabilities. In addition to enabling access to cutting-edge logistics technologies, outsourcing logistics services to a 3PL provider can save costs and increase scalability, flexibility, and customer satisfaction.

Final Thoughts

The capacity and reach of your eCommerce firm can be greatly expanded by outsourcing your fulfillment. You won’t need to add any more employees, but you will be able to accomplish more. You just pay for the services and storage space you actually utilize. And you hire professionals to take care of your logistics. Your fulfillment operations can improve thanks to 3PL’s warehouse experts.

Although it isn’t the most glamorous aspect of your eCommerce store, fulfillment is the backbone of your operation. You could lose clients and money due to poor fulfillment. More favorable reviews and devoted consumers can result in excellent fulfillment. The growth curve of your company will be influenced by fulfillment services. Excellent third-party logistics will be able to maintain that upward trend line over the long term.