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Did you know that there is a 3PL provider? What about this 3PL warehouse.
No need to drown in ecommerce terminology for third party logistics companies. You are not the only one.
3PL services are great for any business, no matter how small or large.
However, the 3PL market is expected to grow by 7.1% between 2018 and 2025. This means that you won’t be stuck in the shipping void forever.
Keep reading to learn more about 3PL.
What is a 3PL?
A 3PL is a third-party logistics provider offering outsourced logistics services.
These services cover a broad range of areas, including the management of procurement and fulfilment processes.
It’s an umbrella term that covers all services that involve the storage and Shipping of goods in one way or another.
3PL providers are available in many sizes, from warehousing to refrigerated Shipping.
Which is better, 3PL or 4PL?
4PL might be something you found while searching for 3PL providers. Here’s how they differ.
You might be in the shirt-making industry and need to use the services of a 3PL provider for shirt storage in a fulfilment centre.
Your 3PL provider outsources the process of placing your shirts into specialized boxes before they reach their fulfilment centre. They are now a 4PL provider.
A third scenario is when the 3PL provider becomes the only contact for your company throughout the supply chain. It can be a 4PL (or a leading logistics provider (LLP) once it has been assigned to multiple 3PL activities.
3PL Benefits
Here’s how a 3PL could help your business reach the next level.
You can greatly reduce your operational costs by handling multiple logistics functions, such as distribution, warehousing and packaging.
These services will also be performed by 3PL providers, which is a lot cheaper than hiring someone to do it in-house. They can take advantage of the economies and core business of 3PL providers.
3PL Services: What can they do for my business?
Let’s not wax poetic about how 3PL providers can benefit your business. Let’s dive into the services they offer so you can make an informed decision.
- Procurement: The Art of Streamlining Sourcing, Manufacturing
In simple terms, procurement is how you get the final product that you will sell.
This applies to everything from homemade products to fully-fledged manufactured products.
The procurement umbrella covers all steps in the process.
3PL companies offer a range of services to help you save time and money.
3PL services include raw material sourcing and scouting the best factory for your company. You can also set up a manufacturing schedule and product development.
- Transportation Galore
This is where 3PL providers shine.
3PL services can handle all aspects of your shipping needs, whether you are shipping domestically or internationally.
All the steps involved in selecting the right carriers and handling the paperwork are done quickly and at the most affordable cost.
The distribution services are usually divided into these categories:
- Import/Export – If you are in international buying or selling, freight brokers, air freight and others – can help you cut through the paperwork and get you the best deal.
- Overseas shipping:3PLs can help you secure the lowest freight rates and manage your ship and flight schedules precisely.
- Domestic Shipping –3PLs can act as freight brokers to secure the best US rail and truck freight rates. They also can monitor the fastest pickup times.
- Fulfilment: The E-Commerce Edition
E-commerce businesses have unique needs, which are tailored to the rapid-paced e-market. The 3PL industry can help by providing fulfilment services.
3PL providers can quickly respond to the needs of small and startup businesses that are experiencing rapid growth.
They often offer these services at a much lower cost than an independent warehouse.
There are many types of 3PL fulfilment services. This will depend on whether your business operates as a B2B company or a small business. However, all 3PL fulfilment services offer the same services.
- Order Processing: This deal combines two-in-one services where 3PLs handle customer orders online and package them accordingly. They also perform quality control on the packaging details.
- Inventory and Warehousing: Fully-fledged inventory management includes receiving, storing and tracking. It also provides specialized processes to handle high-value or climate-sensitive items.
- Returns Management Managing returns can cause chaos in your business. You can have your returns sent to your 3PL for processing and restocking.
- Stock Forecasting – Some 3PL providers provide stock level forecasting services. This is essential for meeting orders on time.
- Growth Services: To Increase Your Sales and Customer Reach
A few 3PL companies offer front-end services. These services can be a great way to increase your client base and market your products.
Some services are specifically tailored for e-commerce businesses. These services are made up of strategies that can be used to tackle online markets.
You can delegate all functions, including brand development and online store management to social media multichannel administration, to professionals.
Save time and money to focus on your core business, whether you are a startup owner or small business owner.
But make sure you choose the right 3PL provider. The right 3PL provider can access intelligent procurement. This will make the supply chain logistics a well-oiled supply to sale logistics machine.
