Ecommerce has exploded in 2020. With the pandemic chasing people away from retail outlets, more customers than ever before are discovering online shopping. Figures from the Census Bureau out in August show just how much ecommerce is growing. In the second quarter of 2020 (from April through June), ecommerce was 31.8% higher than the previous quarter, and 44.5% higher than the same quarter 2019. If you’re running an ecommerce operation, this great news comes with some massive headaches. It’s likely you were not fully prepared to handle this huge increase in demand. Take a breath; third party logistics (3PL) providers are here to help.
What are 3PLs?
In simplest terms, 3PLs are companies that specialize in receiving, storing, transporting, and delivering products. They are experts at managing all the details that must be correct in getting a particular package to a particular place at a particular time. Many 3PLs also offer other services from the reverse logistics necessary in returns, to customized packaging, and even customer service call centers. 3PLs can relieve you of a wide variety of issues around fulfillment and delivery. Let’s explore some of the most important ones.
Efficiency
Having a 3PL provider increases the efficiency with which your orders are processed and shipped. Your vendors can ship merchandise directly to the 3PL warehouse, where the 3PLs integrated technology works with your online shopping cart platform to maintain inventory at appropriate levels. When orders come in, the 3PL handles all of the packing, labeling and shipping. The 3PL tracks the product from its place on the shelf to the final delivery destination. And it takes care of any snafus or delays on the way. Often, if an order is returned, the 3PL handles all the reverse logistics, restocks, and automatically adjusts the inventory. You get contented customers without the anxiety of micromanaging every shipment.
Cost Effectiveness
When a 3PL company handles your order fulfillment process, that decreases your own expenses. Instead of paying for your own storage that locks you into a warehouse lease and doesn’t acknowledge inventory variability, a 3PL warehouse will charge you for the space you actually use when you really use it. You also don’t have to hire and pay extra staff members to handle fulfillment on your end. Because the 3PL works with a number of clients, it can negotiate the best deals for shipping, too. So you’ll spend less on shipping, and have the option to offer your customers lower shipping rates too.
Customization
As indicated, a 3PL can cover every aspect of order fulfillment for you. But 3PLs can also offer customized solutions tailored to your specific needs. Are you focused on adding next-day or same-day shipping to your e-commerce site? Compass Fulfillment can find the perfect 3PL to help you do that. Do you want to provide gift-wrapping services, or need temperature-controlled packaging? There are 3PLs out there that can do both of those things. Maybe you want to offer gift wrapping and personalized subscription boxes? There’s a 3PL that can help you do so.
Scalability
Working with a 3PL provider gives you the greatest scope to grow. As demand for your products increases, your 3PL partner will be ready to store increased inventory, process more online orders, and deliver with the accuracy and efficiency your brand demands. This kind of scalability also means that 3PLs are perfectly positioned to offer you flexibility. If you’re planning a huge holiday sale, for instance, your 3PL company can adjust accordingly and make sure it has enough transportation solutions and fulfillment staffers in place to meet that higher order volume. Conversely, you don’t have to let go of your workers if there is a lull in orders; the 3PL company works with a number of clients so their staffing isn’t affected.
With ecommerce continuing to grow, the decision to work with a 3PL company is a wise one, but only if you use a company that is focused on meeting your ecommerce needs and can provide you with quality service and effective solutions. Compass Fulfillment can help you find the best 3PL provider for your specific needs.
