Have you been struggling to keep up with fulfillment or manage your product inventory due to a recent influx of orders? Maybe you’ve been handling it all on your own, or you’ve been disappointed by your current 3PL provider who hasn’t been able to keep up with your recent increase in business. Using a 3PL to grow your business can be a wise decision, but if you choose the wrong partner, it can be a costly mistake. Below are some tips on how to choose a 3PL provider that can match your business’ growth, so you can focus on putting your energy towards developing your company.
Assess Their Ability to Scale Up
Chances are you started your business with the hope that it would grow. And if you outsource logistics, then it’s important to make sure you have a provider that can offer business scalability. So what does that look like from a 3PL provider?
A 3PL group that can handle your business growth will:
- Have systems in place to easily integrate real-time data.
- Offer an established distribution infrastructure with multiple locations.
- Easily and quickly communicate to make necessary changes.
- Offer key support services to help you figure out your best next steps.
While there are a lot of things to look for when choosing a 3PL partner, the factors above can tell you if they’ll be able to keep up if you suddenly have a rush of sales or demand for a certain product.
And make sure your 3PL provider doesn’t just tell you they can scale up. Ask them to show you. A great way to vet their ability is to request examples or case studies of how the provider successfully scaled with one of their clients previously.
Flexibility is Key if you Outsource Logistics
It’s important to be able to quickly pivot if your sales suddenly start taking off. And in the age of e-commerce, your business needs to move fast, as it’s what consumers expect. That’s why flexibility is another factor to consider when choosing a 3PL provider.
First, study your interactions and what kind of relationship you have with your potential 3PL provider. How they communicate with you can be a clue to how well they’ll be able to handle changes or sudden requests. It’s important to also gauge if they value the same goals that you do when it comes to operations. Otherwise, it’s likely going to be a battle when it comes to trusting them to manage your supply chain.
Second, take note of the speed they work at. You need to make sure your provider can work with fast approvals and rapid changes. If there’s a large chain of approval to make changes, they may not be able to react quickly enough to emergency situations. And if they lag during a critical period of decision making, it could ultimately result in your customers not having satisfactory experiences.
Find Out How They Integrate Technology
A key component of any distribution system is using integrated fulfillment technology. That way you can get both real-time information and accurate forecasting. The right mix of fulfillment technology will help you have better planning, expand your performance, and reduce risks.
If you decide to outsource logistics, look for a mix of technology that:
- Tracks and recognizes overarching business trends (for forecasting).
- Manages orders smoothly and efficiently.
- Records employee labor time for accurate reporting.
Technology especially matters when it comes to warehouse operations, as that’s the heart of your business. By using a top-notch warehouse management system, your provider can better manage stock, prioritize order fulfillment, boost employee performance, and find ways to reduce excess costs.
All this leads to you benefiting from a smoother, well-run distribution program. And while your customers may not know what’s happening behind the scenes, they’ll be pleased with the results they experience.
Make Sure They Offer Reverse Logistics
If you’re using a 3PL to grow your business, make sure you also don’t forget about what comes with expansion: increased returns. It’s always a risk that something could be damaged or doesn’t meet expectations when it arrives at the customer’s door. That’s where the impact of reverse logistics comes into play.
Reverse logistics usually includes:
- Repairs or replacements
- Warranty program management
- Product returns
- Recycling & product disposal
- Refurbishing & resending items
- Recall management
If your provider doesn’t have a good way of handling reverse logistics, you can ultimately incur a set of new problems and high costs. However, if your provider can handle managing stock beyond the sale, your supply chain can benefit from that efficiency and the reduced risk of waste. Plus, it’s one more way to successfully help you continue increasing your business’ bottom line and scaling up in size.
Looking to outsource logistics and benefit from increased efficiency in your business’ supply chain? We have years of experience with clients of all sizes and can ship to 78% of the U.S. in three days with ground shipping. Contact us today for a complimentary quote.
