The warehousing and fulfillment industry is large, fragmented, and populated with 3PLs seeking to seize control of an eCommerce logistics market forecast to gross more than $880 million by 2024. Many 3PLs offer near identical services that range from warehousing activities to transportation services and value-added capabilities such as WMS tools and fulfillment automation.
If you’re going to choose the right 3PL for your business, you need to know how they differentiate themselves from their competitors. In this article you’ll learn about the different types of third party logistics services and how to choose which ones a right for your business.
1. Offer Complete Service Customization
As an eRetailer, merchant, or manufacturer dealing in eCommerce you know better than anyone that no two eCommerce businesses are alike. There are nuances in every supply chain that differentiates one business from another. A 3PL should understand these nuances and be able to offer you custom services that best fit your business.
Though the price is usually the key differentiator for customers on which third party logistics provider to utilize, it’s the overall value of custom warehousing and fulfillment services that should be the primary focus.
What tools does the 3PL provide? Will those tools be an asset to your supply chain? What supply chain management tools provide the most value added? These are the questions supply chain managers need to consider before outsourcing warehousing and fulfillment to a 3PL.
2. Seamless Integration & Assimilation
Today many 3PLs offer a differentiated value proposition that features flexible technology infrastructure that works with a small business warehouse provider as easily as it works with a Tier 1 operator, like Amazon.
In a world with Google, instant communication and high-speed internet, every third party logistics provider should have a SaaS-based infrastructure.
Flowspace integrates directly with your Shopify store to provide you with access to a massive network of warehouses around the country to house your products. Flowspace also integrates with Amazon, which gets you ready for Prime 2-Day shipping no matter the size of your business.
3. Provide Superior Business Intelligence
Unfortunately, many 3PLs today are too consumed with charging a few cents less for a pick, or a few cents less per square foot. To differentiate itself from its competitors, a third party logistics provider needs to deliver excellent service and add value to your supply chain operation, but it should also provide sophisticated analytics to help you stay ahead of your competition.
Data Consolidation
A 3PL that will add value to your supply chain will offer software that consolidates vast amounts of logistics data so you can make informed decisions on how best to improve the speed and efficiency of your operation and keep your customers happy.
Flowspace provides a dashboard with an overview of all the items in your Flowspace warehouses. You can see your inventory, orders, and items that require action, track inbound and outbound shipments and manage all of your SKU items with just a few clicks.
4. Offer End-To-End Solutions
Your supply chain is an end-to-end aspect of your business so it needs an end-to-end solution to keep it lean and running at peak speed and efficiency. As your supply chain grows in scale it also must evolve to accommodate the new and ever-increasing demands of the consumer.
A third-party logistics provider that does not offer end-to-end configuration may not be able to provide you with the service your supply chain network needs when it inevitably changes. You need a 3PL that offers:
- Monthly Pallet Storage with no long-term contracts.
- Easy-to-Understand Pricing
- Low minimums that scale with your business
- Easy to Use Software
- Kitting and Special Services
- Modern Inventory Management
- Access multiple warehouses with a single login
5. Provide Creative Solutions to Common Problems
There are many 3PLs claiming to offer greater capability and management oversight than their competition, which can make it difficult to choose which will provide the most advantages to your business.
If you determine that your supply chain could benefit from a larger network of carriers, then a local 3PL is going to be your best choice. However, if you determine you need a full-service 4PL to manage your supply chain, then there are plenty logistics providers out there that are more than happy to accept your business.
Unfortunately, what many eCommerce merchants realize too late is that few third party logistics can offer a creative solution to the problems that commonly plague eCommerce supply chains. A 3PL that will provide the most value to your business will seek new and more creative solutions to common logistics problems and offer them as a base service.
Flowspace On-Demand Warehousing
The growth of eCommerce and the rapid automation of transportation, warehousing and fulfillment is forcing 3PLs to adapt their business model and adopt a third party logistics strategy similar to on-demand platforms.
On-demand warehousing services like Flowspace enables retailers to dynamically deploy different inventory volumes to different warehouses across the country in little to no time, thus expanding the retailer’s previous distribution network into a comprehensive and responsive supply chain that is ideally suited to the ever-changing eCommerce marketplace.
With 1000+ warehouses nationwide, Flowspace is the solution for eRetailers and merchants looking to gain a strategic advantage over their competition. Contact us so we can help find a 3PL provider suited for your needs!
Written By:
Allison Champion
Allison Champion leads marketing communication at Flowspace, where she works to develop content that addresses the unique challenges facing modern brands in omnichannel eCommerce. She has more than a decade of experience in content development and marketing.
