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How to Choose the Right 3PL Partner for your Business

Updated: Mar 27


As your business grows, it's important to discover a logistics solution that keeps things running smoothly and ensures customer satisfaction. This is where a third party logistics provider comes in. Selecting a 3PL partner is no easy feat; there are many things that companies need to consider before deciding on one. With numerous 3PL providers in the market that can all bring something a little different to the table, it's vital to pause and really consider your business needs. From there, it’s important to partner with a logistics service provider that’s able to help you scale your business and meet your goals, not just serve as an inventory storage unit. Regardless of your industry or location, here are some factors to consider when choosing a 3PL:


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Services & Capabilities:


Before you jump into exploring 3PL providers, pause and get a sense of your business's specific logistics needs. Think about how much you're shipping, the kind of products you deal with, and any unique handling or storage requirements. For example, if the product that you ship to the warehouse comes in on slip sheets, then you need to confirm that the 3PL Provider has access to a Slip Sheet Handling attachment. It's crucial to find a 3PL that aligns with your unique requirements and has the capability of handling them successfully. 


Industry Experience and Reputation:


Industry expertise and know-how is definitely a characteristic you want in a 3PL provider. Consider this: you are looking at two 3PLs. One has a couple years of experience under their belt with good google reviews. The other has been in the industry for 10 years and has established a reputation, has good reviews, references, case studies, etc. The 10 year 3PL seems like the obvious choice here. There are a lot of unique challenges that a 3PL provider has to face on a daily basis, and picking a provider that has been in a similar situation before will be better equipped to service your business specific needs. Reputation speaks volumes. Check out what people are saying about potential 3PL partners – look into Google reviews, testimonials, and case studies. A partner with a good reputation is more likely to bring an overall positive experience to your logistics operations.


Technology:


In your industry, whether it's e-commerce, healthcare, or manufacturing, having a 3PL partner with technological know-how is a game-changer. The use of modern tools like real-time tracking systems and Warehouse Management Systems (WMS) is key to making a 3PL operation run smoothly. Most 3PLs have a robust Warehouse Management System for storing inventory, picking, packing, shipping orders, and managing the workforce. As a business owner, having the ability to track your inventory in a WMS ensures that your orders and stock levels are accurate, which can give peace of mind.


Scalability:


When exploring different 3PL providers, you should evaluate their scalability – can they grow with your business, and are they flexible enough for always changing market dynamics? Demand may decrease for various reasons, and that's when you need a third-party logistics provider that can quickly adjust and streamline your supply chain. On the other side of the coin, when demand suddenly skyrockets, you want a logistics partner that can quickly adapt to the pace without hiccups. Since business landscapes are always changing, your logistics partner needs to be able to keep up. 


Location:


When picking your 3PL provider, location is a game-changer. The closeness of your partner's fulfillment centers to your busy areas is crucial for syncing with your distribution strategy. Being nearby makes managing and working together a breeze. Also, having your products close to your customers ensures faster shipping options, leading to increased satisfaction and loyalty. A 3PL with warehouses strategically located, ideally in bustling cities or near key transportation hubs like ports, airports, and major highways, usually comes with cost-effective shipping benefits.


Responsiveness & Transparent Communication:


Having transparent communication with your 3PL is an absolute necessity. For instance, if your business sends emails to the provider about outbound orders or incoming shipments, and the 3PL consistently takes 2-3 days to respond, it hinders the establishment of trust, and the collaboration is at risk of failure. Therefore, it's essential to choose a 3PL provider that communicates openly and consistently. A reliable point of contact and frequent updates can be extremely helpful when unexpected difficulties occur. Transparency is key, and a reliable 3PL partner will openly share details about their processes, fees, and performance metrics.


Pricing:


Before committing to a third-party logistics partner for your fulfillment needs, take the time to thoroughly research their pricing structures. Make sure to understand all aspects of their pricing, including weekly/monthly minimum fees, charges per square foot, and any additional fees.  While cost is important, consider the overall value the 3PL partner brings to the table. Finding the perfect balance between cost and value is crucial. Take your time and consider different 3PL alternatives. It's also a good idea to check which services are covered in the quoted price and to what extent. Choose a 3PL provider whose proposal aligns well with all your storage and handling needs.


To summarize, there are several factors to think about when selecting a third-party logistics provider. If the factors above align with a potential 3PL, then the final step would be to schedule a warehouse visit to get a lay of the land. Meeting face to face with the people you will be working with and seeing the facility in person will put minds at ease as you begin your collaboration. If your business is in need of a 3PL that exemplifies what has been listed in this article, then reach out to Supply Chain Warehouses. We are a full service 3PL that pays attention to your needs and responds quickly, creatively, and accurately to your unique situation. Reach out today!



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