There has never been a time where there has been greater emphasis on reducing costs, maximizing efficiency all while meeting delivery and customer expectations like there is today. 3PLs have become the answer to meeting all these demands as they offer support to the warehouse in order to retain customers and improve eCommerce operations.
3PLs or Third-Party Logistics companies offer a service that gives you the option to outsource operational logistics from inventory management, warehousing and fulfillment which allows you to focus on your other business operations. Some of the services offered by 3PLs include transportation, warehousing, picking, packing, inventory forecasting, order fulfillment, packaging and freight forwarding.
3PLs allow you to improve your speed and efficiency which guarantees business growth as they can handle more work and you do not have to hire more staff. These are some of the elements of the 3PL process.
Receiving occurs before shipping occurs in order for shipments to go out. 3PLs need to receive the incoming inventory in their warehouse. Every 3PL has its own way and capacity for how inventory will be received and stored.
This step occurs after the inventory has been received. This inventory is stored at a fulfillment center with separate storage locations such as shelves, bins or pallets. No two 3PLs will have the same storage capacities so it is important to choose one that will be able to accommodate your current inventory and be able to handle your business’ growth if you have to expand your order volume and product line.
3PLs will be able to manage your inventory especially because they possess valuable experience to do so efficiently. They can implement measures that can assist you with managing your inventory levels and offer you advice on supply chain management, the appropriate restocking levels and the recommended seasonal inventory levels.
Picking, Packing and Shipping
The most important aspects of order fulfillment are picking, packing and shipping. The first step for the 3PL fulfillment process begins when a customer places an order. The 3PLs technology then checks the inventory levels and the order is sent to their sales channels where it is forwarded to the fulfillment warehouse; and a picker locates the order items on the shelves.
A packer then chooses the packing materials that they will use for the order and this is when they can make use of custom packaging.
The final process involves shipping the order and this contains the packer adding a shipping label to the package and the shipper ensuring that the order is picked by a carrier once it is completed.
Reverse logistics which is also known as the returns process, involves handling customer returns. When a customer returns a product, it will be shipped back to your 3PL and they will handle the process of returns, restock or disposing of the item based on your preferences. The quicker this process occurs, the quicker it is to resell undamaged products that were returned.
Customer Expectations Can Help You Meet
3PLs are able to assist businesses in meeting customer expectations. Here are some of the ways that they are able to do so.
- Improved visibility and order accuracy
Customers require to see whether certain products are in stock, whether this is online or in-store and when these products will be delivered to them. In order for businesses to offer the current product availability, the quantity the customer can order and when customers will receive their orders, they will require information technology. This technology can be quite expensive and it needs a trained technician to handle, and update it as well.3PLs are able to assist with this as they can provide real-time inventory information that is accurate. This information can be used to make deliveries better and track them as well; allowing you to offer up-to-the-minute order status. This ensures that you provide products to your customers quicker and identify problems quicker; enabling you to come up with solutions to address them.
- Seamless Service
There has never been a greater emphasis on providing consistent customer experiences than there is today. Businesses need to ensure that they offer their customers with a seamless shopping experience each time. 3PLs are able to do this as they can optimize inventory and allow you to fulfil orders from multiple sources. This gives customers more options such as buying online and picking up in store or ordering online from the store. It also ensures that customers have the same shopping experience whether they choose to shop online or in-store.
- Cheaper and Faster Deliveries
Customers now demand their products quickly and at a cheaper rate as there has also been a rise in two-day shipping. 3PLs can assist you with delivering your products to customers more quickly as it processes orders more efficiently and chooses a fulfillment source that is closest to the customer.3PLs also make use of automation systems and material handling equipment that increases the order turnaround times. This ensures that orders can be shipped in quicker and it reduces the cost of the devices as you are able to save costs on outbound freight costs. They can also negotiate rates by pooling parcel packages and making use of postal work-share options such as drop-shipping.
One of the ways you can guarantee customer loyalty is by making use of personalization options. These personalization options include gift wrapping, embroidery or even engraving which all help make the customers’ purchases unique. The downside to this option is it is labor-intensive.3PLs can accommodate many value-added services which allow you to offer your customers with personalization options without excessive inventory. 3PLs have flexible space and labor which can add customers’ personalization needs until the last minute; allowing you to accurately meet customer demands as they also have facilities that are strategically located closer to the customer in order to increase speed in hand.