Third-party logistics, or 3PL, is a vital tool for a successful fulfillment strategy in today’s competitive market. When you are first establishing a retail or e-commerce business, completing and distributing products may be easy. However, business growth can compound your work exponentially, and fulfilling orders with your staff and resources can quickly become unmanageable. Warehouse fulfillment companies have stepped in to solve these issues by providing warehouse space, packaging, shipping, and other fulfillment services.
Daily 3PL is an industry-leading provider of 3rd-party logistics and supply chain management services. Our dedicated team of experts offers decades of experience in supply chain management, warehousing, inventory management, automation, and distribution logistics. We leverage this knowledge to help you maintain a competitive edge with faster, more efficient fulfillment.
State of the Supply Chain Industry
The status of the global supply chain industry significantly affects businesses worldwide. From manufacturing companies to retailers, virtually every business depends on a reliable supply chain. As demand for supply chain management increases, third-party supply chain companies are stepping in to provide comprehensive management solutions. A recent report on the supply chain management market conducted by Allied Analytics indicates that the global supply chain market was worth $15.85 billion in 2019, and is forecasted to grow by 11.2% to reach $37.41 billion by 2027.
This growth can be attributed to several factors, including the increased use of cloud-based supply chain management (SCM )software in the medical, pharmaceutical, and transportation sectors. With the high costs associated with implementing SCM software, businesses are turning to tech-savvy 3PL companies that can harness the latest supply chain technology to help them keep up in this fast-moving industry.
What is 3PL?
While 3PL companies offer a variety of different services depending on their specializations and the needs of their clients, but they all offer the same general solutions for inventory management and logistics. At its most basic, 3PL involves outsourcing logistics operations to a third-party company. 3PL services encompass a wide range of services and processes, from sourcing raw materials and procuring parts for contract manufacturing companies to managing inventory, warehouse logistics, packaging, and shipping finished products to customers.
How 3PL Services Work
Fulfillment services specifically refer to processes that facilitate the movement of a product from the time that it is ordered until it is shipped to the customer. With the latest technology, 3PL fulfillment companies can begin fulfilling your customers’ orders immediately by sourcing products, packaging, and ensuring that they are shipped to the correct address.
When you contract with a 3rd party logistics company, you eliminate the stress, time, and labor associated with getting the product out the door, so you can focus on growing your business. Through your partnership with a 3PL company, you gain the following advantages:
Time and Money Savings
Managing your supply chain fulfillment can be complicated, time-consuming, and expensive. To perform these operations yourself, you must invest in equipment, software, and labor that can raise your overhead significantly. 3PL companies have established relationships with vendors and shippers, giving them more leverage to negotiate lower pricing. Outsourcing your supply chain logistics to a third-party logistics company allows you to save time and money that can be better spent on expanding your product offerings and customer base.
3PL companies are experts in logistics, inventory management, warehouse, contract manufacturing, and more. Not only does a good third-party logistics company have the knowledge and resources to streamline your supply line, but they also have warehouse facilities and distribution centers for inventory management, packaging, and shipping. An established 3PL company already has all of the logistics software, equipment, and automation necessary to ensure speedy, efficient logistics and fulfillment.
Expand Business Reach
By allowing a 3PL fulfillment company to handle your packaging, shipping, and other logistics, you streamline your operations for quicker order turnaround and faster time-to-market rates for new products. With speedy, cost-effective order fulfillment operations and supply chain management, you will have the time and resources to expand your customer base and reach new markets.
Streamline Contract Manufacturing Services
A good 3PL inventory management service will work closely with contract manufacturers to ensure that products are sent to a 3PL fulfillment center based on your inventory needs and they can easily be scaled up or down based on demand. By streamlining the process between your contract manufacturer and 3PL logistics provider, you ensure that your customers enjoy a quick turnaround on even your most popular products.
Dependable and Affordable Warehousing
3PL benefits also extend to storage and distribution. When you contract with a 3PL warehousing company, you gain the use of sizable warehouses for inventory storage, so you won’t have to invest in additional space at your facility. In addition, warehouse logistics companies use cutting-edge technology to track your inventory and sales, which allows you to project demand and manage your resources accordingly. Real-time tracking and data analysis allow your 3PL warehouse to identify bottlenecks and other areas for improvement to ensure that your operations are running as smoothly as possible.
How Fulfillment Services Improve the Supply Chain
The biggest advantage of using a 3PL company is the cost savings. By saving companies money on logistics, they can more easily scale their business and drive demand. With consumer behavior trending more and more towards online sales, the need for 3PL companies has drastically increased. 3PL companies are more capable of meeting consumer demands for faster delivery at lower prices than companies that handle logistics in-house.
Supply chain visibility has become increasingly important to help companies avoid inventory shortages, comply with industry standards, and accurately track products from production to delivery. 3PL companies increase supply chain visibility through the use of GPS tracking and radio frequency identification (RFID) to locate and identify tagged products.
How to Choose a Reliable 3PL Company
There are many things to consider when choosing a 3PL company to handle the logistics for your company, and each 3PL has its advantages and disadvantages. Some considerations include:
- Specializations & Offerings: It is important to research the companies you are interested in partnering with to determine whether they offer the services you need and if they are compatible with your systems.
- Trust & Stability: When you partner with a 3PL, you will need to share important, sensitive information with them to facilitate your fulfillment requirements, making it critical to choose a provider you trust. Proven track records and financial stability can strengthen your confidence in your chosen partnership.
- Location & Customer Service: Choosing a 3PL company with a wide network of warehouses can further optimize your business success by shortening turnaround times. Your provider should also be committed to continuous improvement to meet customer needs.
Fulfillment Services at Daily 3PL
Whether you are a new e-commerce company enjoying rapid growth or an established retailer looking to scale your business, choosing the right 3PL company can make all the difference. At Daily 3PL, we leverage decades of knowledge and the latest technology to help your company handle every aspect of the order fulfillment process, from the moment your customer places an order until it is shipped.
Our comprehensive selection of 3PL services include:
- E-Commerce Fulfillment
- Pick, Pack & Ship
- Warehouse & Storage
- Inventory Management & Tracking
- Data & Analytics
- Kitting & Packaging
In addition to our fulfillment, warehousing, and inventory management we provide you with detailed data collection and analytics to help you track product movement, so you can modify your marketing techniques, push popular products, and manage shifting demand.
Reach out to us today to learn more about how Daily 3PL can streamline your order fulfillment operations.